So I end off the year 2008 with an estimated monthly passive income of $220.
The next goal that lies ahead for 2009 will be for me to increase my passive income to $400 per month. That will require an increase of $180 per month or $2160 per year. If I am able to find some investment vehicle that gives me a 10% cash payout annually, I will require $21,600 in cold hard cash.
Time to save up for my investments for the coming year!
Drinking and Eating Your Way to Financial Freedom
Eating out is expensive. A meal for 2 at a reasonable restaurant will easily cost you $50. If it is a really nice restaurant, maybe $100 to $150.
So what is the alternative? Well... you can always eat at home of course!
This is what I had for dinner today. It wasn't cheap but compared to eating out, it is much cheaper.
I had a Campbell's Soup. It was a long time since I drank Campbell's soup and now I remember why I like it so much. They just taste so GOOD! Even better than those Soup of the Day at some restaurants. Well, for appetizer, we had Campbell's Country Style Mushroom Chicken Soup. Simply YUMMY. One can of this roughly feeds two. Sprinkle some ground pepper and eat it with bread.
For the main course, honey glazed chicken:
Well, I tore this and sandwiched it between bread, dip it into some tomato sauce and dunked it into my campbell soup. Delicious.
Drinks - Yellow Tail Chardonnay
The cost of the meal (for 2) was less than $35 =)
So what is the alternative? Well... you can always eat at home of course!
This is what I had for dinner today. It wasn't cheap but compared to eating out, it is much cheaper.
I had a Campbell's Soup. It was a long time since I drank Campbell's soup and now I remember why I like it so much. They just taste so GOOD! Even better than those Soup of the Day at some restaurants. Well, for appetizer, we had Campbell's Country Style Mushroom Chicken Soup. Simply YUMMY. One can of this roughly feeds two. Sprinkle some ground pepper and eat it with bread.
For the main course, honey glazed chicken:
Well, I tore this and sandwiched it between bread, dip it into some tomato sauce and dunked it into my campbell soup. Delicious.
Drinks - Yellow Tail Chardonnay
The cost of the meal (for 2) was less than $35 =)
NOL again
Okay. I bought 2 lots of NOL at $1.16 today.
Willing to keep it for long or sell it if it manages to go up.
At current price earnings, should be pretty safe to just hold
Willing to keep it for long or sell it if it manages to go up.
At current price earnings, should be pretty safe to just hold
Financial Freedom Goal Setting
I have learnt from previous workshops that goals must be SMART:
S - Specific
M - Measurable
A - Attainable
R - Realistic
T - Timely
In my earlier postings, I defined financial freedom for myself as when my passive income exceeds my expenditure. I gave myself the timeline of 2022 to bring down my monthly expenses to $2800 and to bring up my monthly passive income to $2800.
Based on increasing my passive income by $2400 every year, I will be able to increase my monthly passive income by $200 each year. The plan is as such
2008 - $200 (achieved)
2009 - $400
2010 - $600
2011 - $800
2012 - $1000
2013 - $1200 (Car loan fully paid for)
2014 - $1400
2015 - $1600
2016 - $1800
2017 - $2000
2018 - $2200
2019 - $2400
2020 - $2600
2021 - $2800 (Housing loan fully paid for)
Therefore, by 2022 I will be effectively financially free! Of course, this is based on the assumption that I have paid off all my car and housing loans by then.
S - Specific
M - Measurable
A - Attainable
R - Realistic
T - Timely
In my earlier postings, I defined financial freedom for myself as when my passive income exceeds my expenditure. I gave myself the timeline of 2022 to bring down my monthly expenses to $2800 and to bring up my monthly passive income to $2800.
Based on increasing my passive income by $2400 every year, I will be able to increase my monthly passive income by $200 each year. The plan is as such
2008 - $200 (achieved)
2009 - $400
2010 - $600
2011 - $800
2012 - $1000
2013 - $1200 (Car loan fully paid for)
2014 - $1400
2015 - $1600
2016 - $1800
2017 - $2000
2018 - $2200
2019 - $2400
2020 - $2600
2021 - $2800 (Housing loan fully paid for)
Therefore, by 2022 I will be effectively financially free! Of course, this is based on the assumption that I have paid off all my car and housing loans by then.
Bank Account is Fat
Monday:
Bank Account is Fat from the year end bonus.. Looking for stocks to increase my passive income again.
Tuesday :
I put a queue of 3 lots of Ascott REITs to add to my income portfolio. I shall not engage in trading. This will be kept as part of my passive income portfolio/
I might put the remainder of my cash into my Maybank iSaavy account or simply buy more stocks. I actually put a queue earlier today but did not manage to buy it. Hopefully the market tomorrow will allow me to purchase this 3 additional lots of Ascott REITs
Wednesday:
Still did not manage to get Ascott REITs. Queued again 3 lots at same price.
Friday:
Still did not manage to get any Ascott REITs. Makes me wonder whether I should have just bought the stocks at whatever price the market was selling. Updated my networth (current @$467,372)
Bank Account is Fat from the year end bonus.. Looking for stocks to increase my passive income again.
Tuesday :
I put a queue of 3 lots of Ascott REITs to add to my income portfolio. I shall not engage in trading. This will be kept as part of my passive income portfolio/
I might put the remainder of my cash into my Maybank iSaavy account or simply buy more stocks. I actually put a queue earlier today but did not manage to buy it. Hopefully the market tomorrow will allow me to purchase this 3 additional lots of Ascott REITs
Wednesday:
Still did not manage to get Ascott REITs. Queued again 3 lots at same price.
Friday:
Still did not manage to get any Ascott REITs. Makes me wonder whether I should have just bought the stocks at whatever price the market was selling. Updated my networth (current @$467,372)
Trader or Investor
I bought 2 lots of NOL at $1.15 yesterday. Today, the price of NOL shot up to $1.34 and I sold it.
Was it right for me to sell? Only time will tell. But it seemed like too good a deal to miss. More than 10% gains in a single day.
So I guess you can call me a trader - investor. Investor because I keep some stocks for the long term. Trader because I do keep some stocks for the short term.
These are my current list of stocks:
1. First REIT
2. Ascott REIT
3. Suntec REIT
4. Pac Andes
5. Kingboard
6. Innotek
7. Unifood
8. NOL
9. China Aviation Oil
10. Hongguo
My Monthly Passive Income has hardly budged over the past month as I have not bought any income stocks. The $300 plus that I got in dividends for the Month of November will go to my Maybank iSaavy Account.
During this financial turmoil, I also have rebalanced my portfolio under my investment linked policy.
Equity markets (US, China, Europe, Emerging Markets) - 60%
Bonds, Fixed Income - 20%
Global Resources/Commodities - 20%
Hopefully this rebalancing of my portfolio will aid me in my financial freedom journey as my ILP now has over $20k in it.
Wanted to end one of my life policies but decided against it as its current surrender value is lower than all the installments I (and my parents) have paid for. My parents bought it for me when I was young and handed it over to me when I started work. While the current surrender value is very low (13k), the bonuses accumulated is close to 18k. By paying it off for another few more years, I should be able to break even and maybe surpass the installments that I have been paying for it. It is a life policy anyway so I will just treat it as part of my retirement plan.
During this period, I also increased my life insurance coverage and critical illness coverage.
Was it right for me to sell? Only time will tell. But it seemed like too good a deal to miss. More than 10% gains in a single day.
So I guess you can call me a trader - investor. Investor because I keep some stocks for the long term. Trader because I do keep some stocks for the short term.
These are my current list of stocks:
1. First REIT
2. Ascott REIT
3. Suntec REIT
4. Pac Andes
5. Kingboard
6. Innotek
7. Unifood
8. NOL
9. China Aviation Oil
10. Hongguo
My Monthly Passive Income has hardly budged over the past month as I have not bought any income stocks. The $300 plus that I got in dividends for the Month of November will go to my Maybank iSaavy Account.
During this financial turmoil, I also have rebalanced my portfolio under my investment linked policy.
Equity markets (US, China, Europe, Emerging Markets) - 60%
Bonds, Fixed Income - 20%
Global Resources/Commodities - 20%
Hopefully this rebalancing of my portfolio will aid me in my financial freedom journey as my ILP now has over $20k in it.
Wanted to end one of my life policies but decided against it as its current surrender value is lower than all the installments I (and my parents) have paid for. My parents bought it for me when I was young and handed it over to me when I started work. While the current surrender value is very low (13k), the bonuses accumulated is close to 18k. By paying it off for another few more years, I should be able to break even and maybe surpass the installments that I have been paying for it. It is a life policy anyway so I will just treat it as part of my retirement plan.
During this period, I also increased my life insurance coverage and critical illness coverage.
Bonus Bonus Bonus!
Yup. The year end bonus is coming and I am expecting a nice yummy sum of money.
Have bought an additional 2 lots of NOL at $1.15 today to average down on my previous position.
Have bought an additional 2 lots of NOL at $1.15 today to average down on my previous position.
Saving and Spending
Below is a list of items that I am saving for and also items that I would like to spend my money on.
I personally believe that it is important to save/invest more than 10 percent of one's salary. Of equal importance is also to spend at least 10 percent of one's salary to make your home a better place for your family.
List of things I am saving for:
1. Retirement ( est. $1,000,000) ~ currently $70k
2. Son's education (est. $150,000) ~ currently $0 saved
3. My Second Home deposit (est. $200,000) ~ currently $80k saved
List of things I want to buy:
1. A piece of Art to hang on the wall. Bright coloured. It will brighten up my house and make it a much nicer place to live in (Budget $100)
2. Window Grills. For safety reasons as my little boy grows up.
3. 3 x Soap Dispensers (Those beautiful and classy kind of soap dispensers that cost around $20 to $30 each). 1 for the kitchen and 2 for the bathrooms.
4. A nice swivel chair to use for the computer. (budget $200) Will probably buy this from Ikea
5. A door to prevent my boy from entering the kitchen. (est $400)
6. A nice chair for the living room. (budget $200)
7. An air conditioner for the living room. (not sure how much it costs)
8. A Wii / PS3 / X box (purely for entertainment sake)
I personally believe that it is important to save/invest more than 10 percent of one's salary. Of equal importance is also to spend at least 10 percent of one's salary to make your home a better place for your family.
List of things I am saving for:
1. Retirement ( est. $1,000,000) ~ currently $70k
2. Son's education (est. $150,000) ~ currently $0 saved
3. My Second Home deposit (est. $200,000) ~ currently $80k saved
List of things I want to buy:
1. A piece of Art to hang on the wall. Bright coloured. It will brighten up my house and make it a much nicer place to live in (Budget $100)
2. Window Grills. For safety reasons as my little boy grows up.
3. 3 x Soap Dispensers (Those beautiful and classy kind of soap dispensers that cost around $20 to $30 each). 1 for the kitchen and 2 for the bathrooms.
4. A nice swivel chair to use for the computer. (budget $200) Will probably buy this from Ikea
5. A door to prevent my boy from entering the kitchen. (est $400)
6. A nice chair for the living room. (budget $200)
7. An air conditioner for the living room. (not sure how much it costs)
8. A Wii / PS3 / X box (purely for entertainment sake)
Networth Main Contributor : My House
So far, one of the large ticket items that I have bought is my 4 room flat.
Based on the 3Q 2008 housing statistics obtained from HDB, my 4 room flat is worth $481,000 (based on the median price). Considering that I bought my home at just slightly above $300,000, this has by far proven to be my best "investment" (note: I do know that this is not really an investment per se)
Based on the 3Q 2008 housing statistics obtained from HDB, my 4 room flat is worth $481,000 (based on the median price). Considering that I bought my home at just slightly above $300,000, this has by far proven to be my best "investment" (note: I do know that this is not really an investment per se)
| TOWN | 4-ROOM | 5-ROOM | EXECUTIVE |
| ANG MO KIO | $333,000 | $468,000 | - |
| BEDOK | $305,000 | $430,000 | $471,000 |
| BISHAN | $390,000 | $537,500 | $600,500* |
| BUKIT BATOK | $335,000 | $441,400 | $470,000 |
| BUKIT MERAH | $438,300 | $572,000 | - |
| BUKIT PANJANG | $284,000 | $360,000 | $457,500 |
| BUKIT TIMAH | $431,900* | $615,000* | $667,500* |
| CENTRAL | $386,000* | $593,000* | - |
| CHOA CHU KANG | $299,000 | $358,800 | $413,000 |
| CLEMENTI | $367,000 | $503,900* | $630,000* |
| GEYLANG | $364,000 | $570,000* | $500,000* |
| HOUGANG | $303,000 | $380,000 | $462,000 |
| JURONG EAST | $308,500 | $418,000 | $465,000 |
| JURONG WEST | $294,500 | $363,000 | $406,000 |
| KALLANG/WHAMPOA | $400,900 | $520,000 | $542,500* |
| MARINE PARADE | $395,000* | $632,500 | - |
| PASIR RIS | $320,000 | $375,000 | $500,500 |
| PUNGGOL | $327,000 | $391,500 | $450,000* |
| QUEENSTOWN | $481,000 | $620,000* | $780,900* |
| SEMBAWANG | $300,800 | $355,000 | $420,000* |
| SENGKANG | $320,000 | $374,000 | $458,000 |
| SERANGOON | $325,000 | $414,000 | $485,000 |
| TAMPINES | $330,000 | $395,000 | $488,000 |
| TOA PAYOH | $397,000 | $553,000 | $617,500* |
| WOODLANDS | $283,400 | $330,000 | $420,000 |
| YISHUN | $251,000 | $338,000 | $401,000* |
| OVERALL | $313,000 | $380,000 | $455,000 |
Being Frugal
In one's journey to financial freedom, being frugal is definitely one of the criterion.
Can one be frugal and still enjoy life? I will like to think so. Many things in life can be enjoyed without spending much money.
Let's take the case of eating out.
By eating at a cheap hawker center, one saves alot more compared to eating at a fancy restaurant. And seriously, the food actually tastes pretty much the same.
Take the example of how I spent my morning today:
I took a slow walk together with my family to Margaret Drive Hawker Center. Ordered a bowl of fishball noodles (S$2.20) for my wife and duck noodles ($2.50) for myself. I topped that up with 2 x Iced Tea and a cup of coffee ($2.60) and also 2 delicious popiah ($2.40).
That was a hearty meal at less than $10. In times like this, saving up every single cent surely counts. A meal at MacDonald's would cost more than $10 definitely.
Read Related Postings:
Top 10 Money Saving Tips
My Saving and Spending List
Drinking and Eating Your Way to Financial Freedom
Can one be frugal and still enjoy life? I will like to think so. Many things in life can be enjoyed without spending much money.
Let's take the case of eating out.
By eating at a cheap hawker center, one saves alot more compared to eating at a fancy restaurant. And seriously, the food actually tastes pretty much the same.
Take the example of how I spent my morning today:
I took a slow walk together with my family to Margaret Drive Hawker Center. Ordered a bowl of fishball noodles (S$2.20) for my wife and duck noodles ($2.50) for myself. I topped that up with 2 x Iced Tea and a cup of coffee ($2.60) and also 2 delicious popiah ($2.40).
That was a hearty meal at less than $10. In times like this, saving up every single cent surely counts. A meal at MacDonald's would cost more than $10 definitely.
Read Related Postings:
Top 10 Money Saving Tips
My Saving and Spending List
Drinking and Eating Your Way to Financial Freedom
Invest in Gold in Singapore
Gold needs to be part of anyone's portfolio in their journey to financial freedom. Gold serves as a hedge against any inflation. Usually, people recommend that 10% of your investments be in Gold. I currently have 0% in Gold and am looking for opportunities to purchase some Gold bullion or Gold coins. Based on what I have found thus far, only UOB offers gold investments. Please see below for what UOB offers:
___________________________________________________________
Gold Bars
Choose from a large variety of sizes, ranging from small gold wafers to cast kilobars. They can be bought from and sold back to the Bank with our daily buy-sell market quote.
___________________________________________________________
Gold Bars
Choose from a large variety of sizes, ranging from small gold wafers to cast kilobars. They can be bought from and sold back to the Bank with our daily buy-sell market quote.
Gold Bullion Coins
We offer the following bullion coins in various sizes, ranging from 1/20 oz to one oz:
- Canadian Maple Leaf Gold Coins
- American Eagle Gold Coins
- Australian Kangaroo Gold Nuggets
- Singapore Lion Gold Bullion Coins
These coins are legal tender with face value, and are accepted and traded worldwide. They can be bought from and sold back to the Bank with our daily buy-sell market quote.
Adjusted for Singapore market conditions.
Gold Certificates
These are sold in kilobars and up to a maximum of 30 kilobars per certificate. With no expiry date, these certificates can be exchanged for physical gold or cash whenever the need arises.
Gold Savings Account
You can buy and sell international gold - through a passbook - at prevailing market prices and transact any time during banking hours in units of one gm of gold, subject to a minimum of five gm per transaction.
Your gains are not subject to Singapore's Goods and Services Tax (GST) and can be exchanged for cash, whenever the need arises.
Limited to a maximum of 1,000 gm per transaction on Saturdays.
Silver Savings Account
It has never been easier to invest in silver. We have made the international silver market more accessible to smaller investors through our Silver Savings Account, where you can own unallocated silver bullion with a minimum fineness of 99.9%.
You can buy and sell international silver - through a passbook - at prevailing market prices in multiples of 10 ounces of silver each time, limited to a maximum of 500 ounces per transaction on Saturdays.
Your gains are not subject to Singapore's Goods and Services Tax (GST) and can be exchanged for cash, whenever the need arises.
How much does it cost?
- Check our daily gold and silver prices
- For Gold Bars: Prices are based on the daily international gold price adjusted based on Singapore market conditions
- For Gold Bullion Coins: Prices include a premium over the international gold price
- For Gold Certificates:
- A flat S$5 per certificate
- An administrative fee of S$30 per kilobar per annum
- For Gold Savings Account: An administrative fee (in grams of gold) as low as 0.12 gm per month or 0.25% p.a. on the highest balance per month, whichever is higher
- For Silver Savings Account: An annual administrative fee (in ounces of silver) as low as 0.2 ounce per month or 0.375% p.a. on the highest balance per month, whichever is higher
The Dollar Crisis
It seems that many books and articles have been written about the coming demise of the US dollar and the effects it would have on the global economy.
In my journey to financial freedom, I understand that there must be a certain amount set aside hedge against inflation. But what if there is a total collapse of the entire financial system worldwide? What if the US dollar becomes absolutely worthless? How would that affect me and my savings?
If the day was to come when the US dollar becomes totally worthless, I think all countries willl be affected. Everyone will face inflation or hyperinflation and those currencies which are not backed by gold will suffer the most. Of course, this situation is just hypothetical but it could happen in our lifetime.
The best thing one can do is to make sure that a certain amount of money is set aside in Gold - which for the longest time in the history of mankind, has been used as money. Only in recent times have we as nations abandon the gold standard which was replaced by Man's money (easily reprintable and reproducable money).
I am looking for opportunities to invest in Gold.
So far, the only bank in Singapore that sells gold is UOB. I will explore this further in the next posting.
In my journey to financial freedom, I understand that there must be a certain amount set aside hedge against inflation. But what if there is a total collapse of the entire financial system worldwide? What if the US dollar becomes absolutely worthless? How would that affect me and my savings?
If the day was to come when the US dollar becomes totally worthless, I think all countries willl be affected. Everyone will face inflation or hyperinflation and those currencies which are not backed by gold will suffer the most. Of course, this situation is just hypothetical but it could happen in our lifetime.
The best thing one can do is to make sure that a certain amount of money is set aside in Gold - which for the longest time in the history of mankind, has been used as money. Only in recent times have we as nations abandon the gold standard which was replaced by Man's money (easily reprintable and reproducable money).
I am looking for opportunities to invest in Gold.
So far, the only bank in Singapore that sells gold is UOB. I will explore this further in the next posting.
Gold as a Hedge against Inflation
I have been considering buying some physical Gold as a hedge against inflation.
Not too sure how to go about it though as it seems that UOB is the only bank that is selling physical gold coins and bullion in Singapore.
The prices of Gold however seems pretty high even now compared to their historical prices.
Not too sure how to go about it though as it seems that UOB is the only bank that is selling physical gold coins and bullion in Singapore.
The prices of Gold however seems pretty high even now compared to their historical prices.
Decided to Quit My Job
I made the decision to quit my $5k a month job today.
I have not told anyone about the decision.
Will I regret it?
A stable job that pays well but gives me no satisfaction whatsoever. Is time more important than money to me or is money more important to me than time?
With this job, I will be able to pay all my debts in maybe 20 years and be pretty well off (if nothing goes wrong). But the prospect of staying just does not excite me. I want to do something different with my life.
Is it foolish to be making such a decision during such a time as this with all the financial crisis?
What about my responsibilities to my family?
On the other hand, what if I do manage to find a job that pays just as well and gives me more satisfaction?
I have not told anyone about the decision.
Will I regret it?
A stable job that pays well but gives me no satisfaction whatsoever. Is time more important than money to me or is money more important to me than time?
With this job, I will be able to pay all my debts in maybe 20 years and be pretty well off (if nothing goes wrong). But the prospect of staying just does not excite me. I want to do something different with my life.
Is it foolish to be making such a decision during such a time as this with all the financial crisis?
What about my responsibilities to my family?
On the other hand, what if I do manage to find a job that pays just as well and gives me more satisfaction?