Financial Freedom

Definition of Success - A Good Reminder

As I was flipping through the NTUC lifestyle magazine during my visits on the first day of the Chinese New Year, I came across this quote that was quoted by Tommy Wee.

A very good reminder indeed to redefine what success means.

Holland Village Nasi Lemak

Nasi Lemak with achar, egg, long beans and the usual suspects.

After reading a review about how somebody felt cheated eating a plate of Nasi Lemak that costs $7.50, I decided that it is timely to share about one of the more reasonably priced nasi lemak that I know of. This is found at Holland Village Katong Laksa stall. It is located at one of the shophouses near Sushi Tei and the ramen place. They have recently renovated the place and you can easily self-order using an ipad, collect your electronic buzzer (which buzzes when your food is ready). Payment is made when you collect your food. What is great is that you get to customise your own nasi lemak and choose the ingredients that you want.

Economics Explained in Thirty Minutes by Billionaire Ray Dalio - Time Well Spent Watching this Video

This 30 minute video by Ray Dalio explains how the economic machine actually works. Spend the next 30 minutes watching it and I assure you that you won't regret it. Beats any Economics module offered in the universities.

Simple secrets to building wealth

There are probably tons of books written on how one can get rich or become wealthy. Yet, the secret to building wealth is probably much simpler than most people can imagine. If I could choose three words to describe it, I think the appropriate words would probably be "income", "invest" and "persistence".

Firstly, without income, it is very difficult to become wealthy. The only instances one does not require income is probably if you have a large inheritance or you are starting a business (when you have the intention of selling it). At the end of the day, one cannot accumulate assets if one does not have income.

Secondly, one will need to invest.This can be in any instrument. But the idea is that you are only able to invest if you have money left over from your income after taking into account all your expenditure. In most instances, one is able to invest only when spare cash is available.

Lastly, it boils down to persistence. spending money today always seems more tempting and rewarding then saving it for a rainy day. This is especially so when instant gratification seems to be a large part of our culture today. We rather be seen with a Starbucks coffee in hand rather than saving that money and investing it. This is an everyday battle where our heart will tell us to spend when we really ought to be saving. In addition, one also needs persistence to continue saving and investing even when the markets are bad. This is probably very hard since we are all probably wired to try to avoid risk and danger. But the best time to buy is probably when the market is in its doldrums.

How Long Singaporeans Are Going To Spend in Retirement & Why Women May Be In Trouble

According to survey findings released by Manulife Asset Management's Aging Asia Research Series, many people in Singapore are underestimating the length of time that they will actually be spending in retirement.

Many Singapore individuals are expecting the retirement period as a married couple to be 19 years when it is actually closer to 24 years. The projected retirement duration was estimated by analysing the mortality rates from Singapore' Department of Statistics.

Elsewhere, other surveys done by other companies have also shown that 4 in 10 Singaporeans want to retire at 55. Four in 10 Singaporeans also have not started saving for retirement. These are all worrying figures. It shows that there is probably a general lack of good retirement planning amongst Singaporeans.

Expected length of Retirement

Retirement and life expectancy is something that is closely linked. Given the longer lifespan of women, women are also likely to outlive their male counterparts by another 11 years. That brings the typical male retirement length to be 24 years and females to 35 years. This assumes a retirement age of 62 years old.

This seems to be a worrying figure as it probably means that most people will have far less than sufficient money to afford an early retirement or even a comfortable retirement.

It also spells trouble for women as they will be spending a considerable portion of their retirement alone, as the sole survivor. And this has deeper implications as women often exit the workforce much earlier to their male counterparts and would thus have accumulated much less for their retirement spending.

The long life expectancy and the inflation rate is also probably some reasons why the CPF Minimum Sum needs to increase to cater for the changing needs of an ageing population.

Retirement Period Longer than Working Life?

Assuming an individual starts work at age 25 and retires at say age 55, they would have only worked a grand total of 30 years. For a male, it would mean he would have to save up enough money to spend for another 24 years while for a female, it would mean she would have to save up enough money to spend for another 35 years (which is even longer than the period of time she has spent in employment).

Many people are probably making all kinds of retirement planning mistakes by making wrong assumptions about their retirement age and the amount they need to save up. If the time spent in retirement is going to be almost as long as your entire working life, one better start planning early and carefully.

Basically, should not wait until they are only 40 or 50 years old before they start saving for retirement. They better start saving for retirement at age 30 or even much earlier. In my opinion, it is good that people start thinking about their desired retirement age and retirement planning as soon as they start working.

Time to Re-think Retirement?

So is it time to re-think retirement? My thoughts on retirement have changed over the years. When I first started working, I thought retirement was something to be desired. But after thinking about it, I have come to view retirement differently. Given the long life expectancy, it is perhaps one remains employed and continue to contribute to society. After all, spending 20 over years in retirement is not going to be fun when you have nothing to do.

For those who are interested, do check out the following links

Articles on retirement, savings, financial planning and investing:

Real Estate Investment Trusts (REITs)

Commodities/Gold/Silver

Insurance

Popular Reads

The Road to Financial Freedom:

Singapore's Best Chirashi-Don

Bara Chirashi Don @ Sushi Tei Vivocity

Chirashi Don or chirashizushi. Some call it diced or slivered sushi scattered in a bowl of vinegared short grain Japanese rice. Others call it "happiness in a bowl".

Basically, this is a dish that comprises slices or sometimes diced up cubes of the freshest raw seafood and which is served on vinegared rice.

To me, freshness is probably the key. The proportion of the various kinds of seafood as well as the portion (neither too big nor too small) also plays a crucial role. My personal preference is to have the seafood diced rather than sliced as it is much easier to eat with the rice. One also cannot help but make mention that the temperature that it is served at also plays a part in the enjoyment of the dish. Too warm and it doesn't really feel right. The rice is also another important factor. When all these come together nicely, what you get is an awesome bowl of indescribable goodness.

If you ask me, the best chirashi-don that I have tasted is probably at Sushi Tei@Vivocity. I have tried the one at Teppei before but I will like to think that I prefer the one at Sushi Tei. At $16 a bowl (see picture above), it is really good value for money.

Do You Earn More Than Singapore's Median Monthly Household Income?

A frequent topic of discussion amongst people in Singapore is whether their household income is more than the median household income.

The Department of Statistics in Singapore publishes a report that is titled "Key Household Income Trends" every year. The latest report is dated 2013.

Some points to note first. The paper only highlights income from work received by all working members of the household from employment and business. This means that it does not include income from dividends, etc.

Some people often mistakenly assume that the figures are the median income of a worker employed in Singapore. It is not. It refers to the household income.

So here are the numbers:

Among resident employed households, median monthly household income increased from $7570 in 2012 to $7870 in 2013. This represents a 4.0% growth in nominal terms, or 1.6% in real terms (where the Consumer Price Index) is used as a deflator to compute real income changes.
Taking household size, median monthly household income from work per household member rose by 5.6 per cent in nominal terms, or 3.2 per cent in real terms.

I make three observations on the median monthly household income figures:

Firstly, we can see that the median household income amongst resident employed households is almost reaching $8,000. However, we also note that resident employed households does not equal to the resident households in Singapore. As many as 9.4% of the resident households in Singapore have no working persons with 6.1% of these considered as "Retiree" households. That means that the data on the median monthly household income is only representative of 90.6% of the resident households in Singapore. Granted that some of these households might be really poor, 6.1% of these households probably have accumulated more assets/wealth/passive income compared to a household that is earning $7870.

Secondly, the survey only relates to roughly 70% of the population in Singapore since the focus is only on households that are headed by Singaporeans and PRs (granted that some of the non-Singapore citizens or PRs might actually be under a household headed by a Singapore citizen or PR). This is because the analysis is only based on households headed by Singaporean and permanent resident (PR). In 2014, the total Singapore population was 5.469 million. The resident population (Singaporean and PR) was 3.87million. This means that t

Thirdly, we should also take note that the source of data is from a sample of households surveyed in the June Comprehensive Labour Force Surveys conducted by the Ministry of Manpower. Based on what I googled, it appears that 30,000 households were surveyed. So this is only a sample of survey results and might not indicate or depict the true picture of the state of affairs.

So if you think that having a household income of greater than $7870 puts you in the top 50% of the Singapore population, think again.