Financial Freedom: Saving

Showing posts with label Saving. Show all posts

Why You Should Quit Smoking

All smokers should quit smoking. Logically, I guess everyone knows the health reasons why. Today, I will like to show the financial aspect of smoking.

Smoking Raises Your Insurance Premiums

Insurance companies know that smokers have a higher risk of falling ill and perhaps dying young. This is not based on guess work but on actuarial studies where they study statistics and stuff. As such, a male in his 30s who is a smoker will pay a higher premium for insuring himself compared to another guy who is not a smoker.

Overall, this premiums might seem only slightly more but add it up over the years and it could amount to a tidy bit of money.

A Pack of Cigarettes Costs Like A Meal?

If you smoke a pack of cigarettes a day, you would be spending easily $5 over dollars per pack. This is good enough to pay for lunch or dinner!

Why would you want to spend an additional $5 a day when compounded over 30 days, that amounts to $150.

Over 12 months, it is equivalent to $1800!! That is easily half a month's pay for a graduate that just started working.

If you are in your twenties, just invest $150 a month at 8% returns and you will be amazed at how much money you will have when you retire.

Smoking Accessories

Smoking stinks. And I mean literally. That is why smokers often have to buy a pack of cool mints to suck on after they have had their fix so as to make their breath fresh.

This pack of cool mints again costs them $$$.

Read Related Articles:
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2. Leaving Assets for Future Generations
3. Independent Financial Advice
4. Health Equals Wealth

2 Easy Steps to Build an Emergency Fund

Today, I will show you 2 easy steps anyone can take to start saving money to build up an emergency fund.

An emergency fund is basically 3 to 6 months of income that you set aside which you can withdraw easily. This means that the fund is most probably in a bank account that you can easily tap into should any emergency arise.

Step #1 - Open Another Bank Account

Yes, you heard me right. Why do you have to open another bank account? It is very likely that if you were to start saving money into the same bank account, you will most probably spend the money without knowing it. The most important thing about an emergency account is to keep it out of sight from us so that we do not spend the money!

Many years ago, I wanted to set aside an emergency fund of 6 months income. It was however only 2 years ago that I managed to do so. The reason for the long delay was that I was simply spending all my money in my only bank account which I had. Whenever it reached a certain amount, I would think to myself: "Hey, I've got lots of money....why not I buy this?"

To cut a long story short, I could not succeed in building up the 6 month emergency fund because I had easy access to the account. I started withdrawing money from the fund as it was not kept separate from my other bank account. This is my BEST advice to you: OPEN ANOTHER BANK ACCOUNT.

You will of course want to make sure that this bank account does not have any high charges and stuff for things like minimum balances.

Step #2 - Deposit a FIXED sum of money EVERY month ONCE you get your paycheck

Keeping a separate bank account is Step 1. For Step 2, it requires a certain amount of discipline. The key is to deposit a FIXED amount EVERY month the DAY you get your paycheck.

The day that you get your pay check credited into your bank account is THE DAY that you must deposit that fixed amount of money into your separate bank account (your emergency fund account). Do not wait for a few days because once you procrastinate, you will most probably not do it and end up not depositing any money at all for that month. This is speaking from my experience.

Let's say that you decide to save $500 per month to build up an emergency fund. All you have to do is simply deposit or transfer the money from your normal banking account straight into the emergency fund account the moment you get your paycheck.

Do this EVERY single month. No excuses.

No lowering the amount too. Every month, you will stick to the amount you have decided and deposit it into your emergency fund the moment you get your paycheck.

SgFinancialFreedom is a blog dedicated to help people achieve their financial freedom. This is done through the sharing of knowledge, information and experience. Find out more about the author and his journey to financial freedom.

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2. Save Electricity, Save Money
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4. 3 Key Lessons from Rich Dad Poor Dad
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Save Electricity Save Money

Electricity tariffs are going up again in Singapore.

From Oct 09 onwards, electricity charges will go up by 12.5 per cent due to higher fuel prices. Prices will be driven up to 21.69 cents per KW hour instead of the current 19.28 cents. This is slightly below the previous high of 22.93 cents for January to March this year.

Out of 1.2 million households, 17131 households had problems paying their bills last month. So what can we do to save electricity and thus save money?

Here are a few tips from the experts:

1. Set the temperature of your airconditioner to 25 degrees Celsius or higher.

2. Do not leave electrical appliances on standby mode. Switch off power sockets at the main.

3. Use a fan instead of the airconditioner on cool days.

4. Choose energy efficient light bulbs and applicances (energy labels with 4 ticks).

More energy saving tips for just these two appliances below could save you a substantial amount of money each month. Check out this link for other tips.

Air-conditioner

1. Close curtains and blinds during the day. Especially for windows that face the west.

2. Run the aircon about an hour before bedtime and switch to the fan.

3. Set the timer by turning off your aircon an hour earlier before you wake.

4. Clean the aircon filter to improve efficiency.

5. Service you aircon regularly to improve overall efficiency.

Computer

1. Switch off the computer if not in use for more than 30 minutes

2. Enable your computer's energy saving mode.

3. Switch off the TV. You only have 1 pair of eyes so do one thing at a time.

So start saving electricity. You will not only save yourself money in terms of electricity bills, but you can also help save the earth.

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Free Stuff
Top 10 Money Saving Tips
My Saving and Spending List
Drinking and Eating Your Way to Financial Freedom

Free Stuff

It is time for me to share with people some free stuff that you can get online. Afterall, keeping our expenditure low is one of the best ways to become financially free.

Free Charting or Trading Tools

For charting purposes, there is a free software out there called ChartNexus that is extremely easy to use. The download is pretty fast too. The user interface is likewise easy even for the begineer. I would seriously recommend it to anyone who is trying out charting for the first time to download this software. Just type ChartNexus into Google and you should be able to find the site to download it from.

Free Sites for Movies or Drama Serials.

I am not talking about downloading movies illegally. Rather, it is about watching movies through streaming websites. You are not downloading anything per se. My current favorite site is www.mysoju.com . In this site, you can find all the latest korean and japanese movies and drama serials. The time it takes to load these movies are also pretty fast.

Free Sites for EPL matches

Want to watch English Premier League matches but can't afford to pay for the sports channel? Fret no more. Simply type MyP2P in google and you should see a website that allows you to watch live matches. You will need to download Sopcast (which is a sort of media player) in order to watch these streaming matches live. If you just want to watch the match highlights, go to YouTube or type matchhighlights.com and you can watch all the goals of the lastest matches.

Free Sites for News

Why buy newspapers when you can read them online? Apart from getting a free copy of the Today newspaper, there are a wide variety of news that is available online today. The following is a non-exhaustive list where I get my daily news from:

So there you have it. Some of the free stuff you can get off the web at no cost to you. Hope you enjoyed this posting.

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Top Ten Money Saving Tips For Financial Freedom

Here are my 10 Money Saving Tips for one to gain financial freedom. Saving money is part and parcel of the process towards financial freedom. Every penny saved is a penny earned.

Imagine the effect of compounding if you were able to save $100 a month and invest it in an instrument that gives you 5% returns per annum. After 30 years, you would have a pretty cool sum of money.

So here you go. My own Top 10 Money Saving Tips:

1. Don't eat at fancy restaurants. If possible, eat at home. If not, just eat fast food. It is much cheaper than eating at a fancy restaurant. Don't upsize your meal. If you just want a burger, order a burger instead of adding a meal on top because it seems like value for money to pay an extra dollar to have a large fries and drink.

2. Save electricity. Off all lights when not in use. Do not leave the heater on if you are not using it.

3. Cancel your global roaming. Most people have global roaming attached to their mobile phone plans. Cancel it if you are not going overseas.

4. Park at a cheaper carpark. Different carparks have different carparking rates. Choose the cheaper one and walk a little.

5. Read your news online. Don't buy newspapers everyday especially if you won't have the time to read it. Just read your news online.

6. Visit the Library. Don't spend money on books. Borrow books from the library.

7. Wash your own car. You save money on both petrol and the expensive car washing services provided by those petrol stations.

8. Pump a cheaper grade of petrol. The grade of petrol should not make much of a difference. I always believe that it is psychological feeling that people get when they use a higher grade of petrol and think that their car responds better to it.

9. Don't buy magazines. You can read them online too! Just surf the net and I am pretty sure that you will come across various sites that gives you the information that you want totally free of charge.

10. Give Starbucks a miss. A Caffe latte probably cost you around $5. That is money that could easily buy you lunch or dinner. Skip Starbucks and make your very own coffee instead.

So there you have it. My own top 10 list for saving money.

Read Related Articles:
1. Save Electricity, Save Money
2. Retire Young, Retire Rich
3. 3 Key Lessons from Rich Dad Poor Dad
4. 3 Sources of Passive Income

Spent $215 Servicing My Car

My car a Mitsubishi Lancer 1.6A was way overdue for servicing so I brought it to a workshop for servicing today.

It is still way under 80,000km and is only around 2.5 years old so rightfully I should have brought it back to the original distribute (Cycle & Carriage) for repairs/servicing as the 3 year warranty would be void if I went elsewhere.

Problem is: Cycle and Carriage servicing is abit slow and tends to be quite expensive.

So after asking around abit, I decided to go to one of the workshops which my friend uses. He said it was pretty cheap.

The total cost was $215 all inclusive and it took about 1.5 hrs. The works included:

1. Replacing engine oil - Voltronic semi synthetic oil 10W40
2. Replacing air filter
3. Replacing spark plugs - volker iridium (last for 2 years/160,000km)
4. A minor improvement to the dent on my bonnet. He tried "sucking" the dent out 3 times but it only got slightly better

Was it worth it?

$1588 for a MacBook

Thinking of buying a MacBook but it costs $1588. Not too sure whether it is too much money to pay for just the Apple brand? I actually took a walk at Wheelock's Place to the Apple store that was on the 2nd floor.

I had to ask myself: " Is this a WANT? Or is this a NEED?"

I then realised that a MacBook is a want. I want a MacBook. But in actual fact, I don't need it.
Perhaps I will just buy an ACER laptop which is much cheaper. It really takes a lot of discipline not to spend money unnecessarily.

Simple logic.

"NO" to buying a $1588 Macbook for myself.

I can buy a much cheaper laptop and save the rest of the money.

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)

Financial Freedom