One of the reasons why I started this blog was to track my passive income earnings.
In 2008, I managed to hit my goal of achieving $200 per month in passive income.
The goal set for the year 2009 was to hit $400 per month passive income.
With 31 days left to 2009, I have to figure out a fast way to hit that amount of passive income.
Here is my estimate at where I am at currently:
1. 12,000 x Ascott REITs (DPU = 3.55 per half) = $71.00 per month
2. 17,000 x First REITs (Annualised DPU = 7.66cents) = $108.51 per month
3. 1000 x Suntec REITs (Annualised DPU = 11.94cents) = $9.95 per month
4. Maybank iSavvy Deposit = $8 per month
5. Online Income Sources = $30 per month
Total = $227.46 per month
I am now torn between putting my capital into dividend stocks or stocks for capital gains.
Lessons From A Beach Bum
We all know the story about the rich and successful man who went to the beach and saw a surfer dude bumming around. He asked the surfer dude to have more aspiration, to get a job, save enough money and then be able to retire...
The surfer dude asked him:" And what am I going to do when I retire?"
"Well, you could sit down at the beach, relax and surf" replied the rich and successful man..
This anecdote always hits me as it reminds me that many times, we can be pursuing the wrong goals in our lives.
We think that money can make us happy and keep looking forward to the future where we think we will be richer and maybe happier.
Alas, the years pass and we are richer but we still do not find ourselves happier.
We analyse the situation and figure out that perhaps we are not RICH enough so we carry on working ourselves to death, trying to keep us with the Jonases and whoever.
I figure that many people realise that after twenty to thirty years of working, they have literally WASTED their entire lives away living up to other people's expectations of them.
This is truly sad but it is extremely real in a society like Singapore.
I guess that there are 2 Key Lessons that we all can learn from the story about the beach bum.
#1 - Treasure the Present
Too many times, we keep thinking about the past and fantasizing about the future while dreading the present. The key to happiness I guess is to learn how to treasure the present.
#2- Get Out of the Rat Race
The race is for rats only. If you are not a rat, please get out of it and spare yourself the miseries of keeping up with the whos who. Seriously, nobody gives two hoots whether you drive a Lexus or a BMW or a Toyota. The people you are trying to impress are busily trying to impress you too so they will hardly notice what car you are driving.The author of this blog is a well-qualified bum in every sense of the word. He advises you to take everything you read in this blog with a pinch of salt.
Dividends for November 09
Checked my bank account and realised that I have received dividends from two of my REITs (First REIT and Suntec REIT)
Total from First REIT = $323
Total from Suntec REIT = $29.21
Sort of regretted selling away some of my Suntec REITs as I would have received a much larger dividend. Oh well, I guess we are always wiser with hindsight.
Total dividends for November 2009 = $352.21
It certainly cannot compare with the dividends that I received for Feb 09, May 09 and August 09 but it beats getting nothing at all.
Read Related Articles:
1. Received Over $1000 for August 09
2. Dividends for May 09
3. Dividends for Feb 09
Total from First REIT = $323
Total from Suntec REIT = $29.21
Sort of regretted selling away some of my Suntec REITs as I would have received a much larger dividend. Oh well, I guess we are always wiser with hindsight.
Total dividends for November 2009 = $352.21
It certainly cannot compare with the dividends that I received for Feb 09, May 09 and August 09 but it beats getting nothing at all.
Read Related Articles:
1. Received Over $1000 for August 09
2. Dividends for May 09
3. Dividends for Feb 09
Donald Trump and Robert Kiyosaki
In this video, Donald Trump and Robert Kiyosaki speak about the book which they co-authored "Why We Want You To Be Rich"
What $680 Can & Cannot Buy
Two events happened today that made me think about what money can and cannot buy.
EVENT #1 - INSTALLING WINDOW GRILLES
For one, I managed to get a nice set of window grilles for my house. It is now a much safer home for my little one as I have always been worried that he would push a chair to the side of the window and climb out too far. With the window grilles now in place, the whole house feels SO MUCH SAFER. I feel much more at ease to let the little one roam about the different rooms and don't have to worry too much about him.
The window grilles cost me $680 and I must say it was a pretty standard price as I asked around for a few quotations and all of them came back with the same quote of $5.50 per square foot of window grilles. Oh well, I guess I can only say that it is money well spent.
EVENT #2 - FALLING SICK
On the other hand, the little one also got a bit sick and he was a bit grumpy at night. And I realised that all the money in the world will not be able to make my little one feeling well right away. At the end of the day, it will be his own immune system that will have to fight back and make him feel better.
So money can't buy you everything. It cannot buy you health.
EVENT #1 - INSTALLING WINDOW GRILLES
For one, I managed to get a nice set of window grilles for my house. It is now a much safer home for my little one as I have always been worried that he would push a chair to the side of the window and climb out too far. With the window grilles now in place, the whole house feels SO MUCH SAFER. I feel much more at ease to let the little one roam about the different rooms and don't have to worry too much about him.
The window grilles cost me $680 and I must say it was a pretty standard price as I asked around for a few quotations and all of them came back with the same quote of $5.50 per square foot of window grilles. Oh well, I guess I can only say that it is money well spent.
EVENT #2 - FALLING SICK
On the other hand, the little one also got a bit sick and he was a bit grumpy at night. And I realised that all the money in the world will not be able to make my little one feeling well right away. At the end of the day, it will be his own immune system that will have to fight back and make him feel better.
So money can't buy you everything. It cannot buy you health.
12,000 HDB flats per year to meet demand
In Singapore, a large percentage of Singaporeans live in Housing Development Board flats or HDB flats. Since the government controls the supply of the flats, there has been a steady increase in the value of the flats over time.
Over the past few months, there has been complaints (mainly amongst younger couples) that there are not enough HDB flats to go around with long queues and waiting times to buy their dream homes.
Just today, I read the newspapers and see that the Housing Board has decided to offer between 10,000 to 12,000 flats ever year over the next 5 years to meet this growing demand. This will serve as the guide for HDB's build-to-order scheme with the actual number made available depending on market conditions.
This year's planned supply of 6,500 flats was quickly raised to 13,500 flats after there was a spike in demand.
So what does all these changes by HDB show?
1. Demand of flats is totally unpredictable and depends on market conditions. Since demand is unpredictable, supply of the flats need to be changed and tweaked accordingly.
2. Complaints by Singaporeans are heard by the government. That is certainly good news for all of us.
Some concerns I have still remain however.
It is my personal opinion that if the supply of flats can be readily tweaked accordingly, this will have an impact on the value of ALL HDB flats across Singapore.
When most Singaporeans spend a large amount of their money and savings into buying their homes, it is not in the benefit of the majority of Singaporeans if the value of their houses do not rise in accordance with market conditions.
I also attach an email from one of my friends regarding this HDB issue. It was written by a professor from NTU and contains a lot of insightful thoughts on the matter. As I do not have the name of this professor, I am not able to give him the necessary credit due in this email.
Please see the email (with certain details deleted).
____________________________________
Thanks xxxxxxx,
Yes, we are living in an upside down world, and Singapore is no exception.
In my joint paper with ******* (attached), to appear in the book "*****" to be launched next month by *** ***, we made the point that in 1965, the goverment owned 20% of the land in Singapore. Today, it owns 80%. There is really no proper market-based land market. The price of land on which HDB/URA builds is artificial. I think about 2/3 of the cost of a new HDB flat is land cost. However, this land was obtained at confiscatory prices from private landowners under the Land Acquisition Act. Hence the present land cost of HDB flats is inflated, because it is based on private land values which are themselves inflated.
Hence, somebody who bought a landed property in 1965 (like myself) has seen its value increase 500 times in 40 years. I sold it and donated 1/3 to charity (****** etc.) as it is not due to my hard work or economic foresight.
I wrote an article in the *** *** suggesting a way out, otherwise young Singaporeans will be priced out of buying HDB flats. Since all land on which HDB flats is government owned, such land should be based on their acquisition cost which is very low, and not on the "market" valuation, which is essentially that based on inflated private property values. Hence new HDB flats will once again be affordable to young graduates. When I graduated in 1960, I could get a HDB flat at 3-4 times my annual income. Today it is 10 times. No wonder our recent graduates feel frustrated.
The problem with this radical proposal is that the values of resale flats would drop. Their prices are also artifically high due to the decision made in the early 80s (referred to in Ngiam Tong Dow's book "The Making on a Mandarin") to raise the value of the land on which HDB flats are built. This was because existing flats owners were making excessive profits when they sold their flats, since they had bought their flats based on HDB land valued at confiscatory prices, and now they can sell at private market-based land values. Hence the prices of new HDB flats rose from the early 80s onward. This made the rise in CPF rates of contribution to 25 +25% necessary which caused the 1985 recession, the first in Singapore's economic history. The HDB in other words did not want new flat owners to make that kind of a handsome profit.
Today the flat owners who are making really handsome profits are those who had bought theirs before the early 80s. There is a politicial cost in alientating these flat owners if the price of new HDB flats drops to what is their "real" cost (i.e. based on the confiscatory acquisition value of the land), so that the price of old resale flats also have to drop. Senior citizens would vote against the governement.
However I think this group is like me, who never really dreamed to get such a high capital gain, when they sell their property. However they are now in the 50+ age group and are facing an uncertain future due to the lack of a safety net for those growing old. If we favour the young by making new HDB flats cheap, the medium-old and old-old would suffer by seeing their only asset, an HDB flat, depreciate in resale value.
Another problem is that some of these old flats are still being HDB-loan financed. If their resale value drops, the HDB may get into trouble. It was only in 2000 that the HDB allowed commercial bank financing.
However this also means that commercial banks now would get hit should those who purchased HDB resale or new flats on commercial loans, find that their market value is below their loan value (negative equity).
Any suggestions on how to get out of this dilmma, now that 85% of Singaporeans stay in HDB flats?
*** ***
____________________________________
Over the past few months, there has been complaints (mainly amongst younger couples) that there are not enough HDB flats to go around with long queues and waiting times to buy their dream homes.
Just today, I read the newspapers and see that the Housing Board has decided to offer between 10,000 to 12,000 flats ever year over the next 5 years to meet this growing demand. This will serve as the guide for HDB's build-to-order scheme with the actual number made available depending on market conditions.
This year's planned supply of 6,500 flats was quickly raised to 13,500 flats after there was a spike in demand.
So what does all these changes by HDB show?
1. Demand of flats is totally unpredictable and depends on market conditions. Since demand is unpredictable, supply of the flats need to be changed and tweaked accordingly.
2. Complaints by Singaporeans are heard by the government. That is certainly good news for all of us.
Some concerns I have still remain however.
It is my personal opinion that if the supply of flats can be readily tweaked accordingly, this will have an impact on the value of ALL HDB flats across Singapore.
When most Singaporeans spend a large amount of their money and savings into buying their homes, it is not in the benefit of the majority of Singaporeans if the value of their houses do not rise in accordance with market conditions.
I also attach an email from one of my friends regarding this HDB issue. It was written by a professor from NTU and contains a lot of insightful thoughts on the matter. As I do not have the name of this professor, I am not able to give him the necessary credit due in this email.
Please see the email (with certain details deleted).
____________________________________
Thanks xxxxxxx,
Yes, we are living in an upside down world, and Singapore is no exception.
In my joint paper with ******* (attached), to appear in the book "*****" to be launched next month by *** ***, we made the point that in 1965, the goverment owned 20% of the land in Singapore. Today, it owns 80%. There is really no proper market-based land market. The price of land on which HDB/URA builds is artificial. I think about 2/3 of the cost of a new HDB flat is land cost. However, this land was obtained at confiscatory prices from private landowners under the Land Acquisition Act. Hence the present land cost of HDB flats is inflated, because it is based on private land values which are themselves inflated.
Hence, somebody who bought a landed property in 1965 (like myself) has seen its value increase 500 times in 40 years. I sold it and donated 1/3 to charity (****** etc.) as it is not due to my hard work or economic foresight.
I wrote an article in the *** *** suggesting a way out, otherwise young Singaporeans will be priced out of buying HDB flats. Since all land on which HDB flats is government owned, such land should be based on their acquisition cost which is very low, and not on the "market" valuation, which is essentially that based on inflated private property values. Hence new HDB flats will once again be affordable to young graduates. When I graduated in 1960, I could get a HDB flat at 3-4 times my annual income. Today it is 10 times. No wonder our recent graduates feel frustrated.
The problem with this radical proposal is that the values of resale flats would drop. Their prices are also artifically high due to the decision made in the early 80s (referred to in Ngiam Tong Dow's book "The Making on a Mandarin") to raise the value of the land on which HDB flats are built. This was because existing flats owners were making excessive profits when they sold their flats, since they had bought their flats based on HDB land valued at confiscatory prices, and now they can sell at private market-based land values. Hence the prices of new HDB flats rose from the early 80s onward. This made the rise in CPF rates of contribution to 25 +25% necessary which caused the 1985 recession, the first in Singapore's economic history. The HDB in other words did not want new flat owners to make that kind of a handsome profit.
Today the flat owners who are making really handsome profits are those who had bought theirs before the early 80s. There is a politicial cost in alientating these flat owners if the price of new HDB flats drops to what is their "real" cost (i.e. based on the confiscatory acquisition value of the land), so that the price of old resale flats also have to drop. Senior citizens would vote against the governement.
However I think this group is like me, who never really dreamed to get such a high capital gain, when they sell their property. However they are now in the 50+ age group and are facing an uncertain future due to the lack of a safety net for those growing old. If we favour the young by making new HDB flats cheap, the medium-old and old-old would suffer by seeing their only asset, an HDB flat, depreciate in resale value.
Another problem is that some of these old flats are still being HDB-loan financed. If their resale value drops, the HDB may get into trouble. It was only in 2000 that the HDB allowed commercial bank financing.
However this also means that commercial banks now would get hit should those who purchased HDB resale or new flats on commercial loans, find that their market value is below their loan value (negative equity).
Any suggestions on how to get out of this dilmma, now that 85% of Singaporeans stay in HDB flats?
*** ***
____________________________________
Sell Your Hair For Money
In Madrid, cash-strapped Spaniards are selling their hair to to pay their bills. The hair is sold to companies who export natural hair for wigs or extensions.
While these companies are able to get huge supply of hair from Asia like China and India, they prefer European hair which is considered of a higher quality and is not as thick as Asian hair.
Ponytails of hair can sell from between 50 to 150 Euros with the price being dependent on both the weight and length of hair.
Justino Delgado is one such happy man who has 90 tonnes of hair kept in his warehouse ready for export to Europe and the United States. The hair is washed and colored in the factories and braided together before export. His business currently employs around 30 people.
While these companies are able to get huge supply of hair from Asia like China and India, they prefer European hair which is considered of a higher quality and is not as thick as Asian hair.
Ponytails of hair can sell from between 50 to 150 Euros with the price being dependent on both the weight and length of hair.
Justino Delgado is one such happy man who has 90 tonnes of hair kept in his warehouse ready for export to Europe and the United States. The hair is washed and colored in the factories and braided together before export. His business currently employs around 30 people.
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