Median Income to Rise by 2020

I haven't had much to write about in the couple of days. Today, when I turned to the front page of the newspapers, I saw the headlines that states that average Singaporeans can expect their incomes to rise from the current median income of $2400 per month to $3,100 per month.

The funny thing about how I read news articles is not on what they report but rather on certain aspects that probably interests noone else but me. In reading this news article, I was more interested in why the goal was to raise the median income instead of the average/mean income. The 2nd thought that formed in my head was this: Will an average Singaporean earn more or less than the median income of $3,100 per month?

The difference between median and mean

This is probably secondary school maths but I guess there is a slight difference between median and mean (or average) when used in statistics. Generally, it depends on the data set and whether the mean or the median gives you the more accurate representation of what "average" really means.

When data is symmetrically distributed, the mean is a good way of calculating the average income. The mean is simple obtained by adding all incomes together divided by the total population. However, when data is skewed either to the left or the right, it might be better to use the median income to give a more accurate reflection of what "average" is in Singapore. So the question that is left to be answered is whether the income distribution curve is skewed to the left or the right. (Of course, to measure income that is not symmetrical, the median is a much better way that the mean).

So there is the tricky part if you say that the "average Singaporean can expect his income to rise because the median income is expected to rise." Here, what it means is that median income actually represents the "average" Singaporean's income more truthfully.

So I basically answered my two thoughts in this posting.

1. To measure income which is often not symmetrically distributed, we use median income which reflects the average income much better.

2. An average Singaporean can expect to earn the median income of $3,100 in ten years time and not more or less.

Other questions that will probably go unanswered are these:

1. Is the mean income in Singapore higher or lower than the median income?
2. Which one is harder for the government to achieve? Increasing the mean income or the median income?

Cheapest Way to Invest

I 0ften get questions from readers of my blog asking what is the cheapest way to invest.

This question is abit baffling to me sometimes as I do not really understand what exactly they are asking about. I am supposing that the question is actually twofold:

1. What investment incurs the lowest brokerage charges, sales charge or commissions?
2. What is the cheapest form of investment (cheapest in the sense of lowest monthly premium committment or lowest initial capital outlay)?

So the question on what is the cheapest way to invest perhaps is a question on what is the lowest amount of money one can invest in and at the same time incur very low charges or fees that could potentially "eat" into the initial investment amount.

Well, if you ask me, the lowest amount of money one can invest is actually in shares. This is considering the fact that you can buy like 10 shares of SingTel which together with brokerage charges will cost you less than a $100. But that is of course not very efficient as the brokerage charges will make up more than 50% of your initial investment.

For example, a person buys 10 shares of SingTel and the brokerage charges is for example $25 per trade.

If SingTel is trading at $3.00, 10 shares of Sintel will cost $30 while the brokerage charges will make the total investment cost $55! What this basically mean is that for buying 10 shares of SingTel, the investor has paid $55 which brings the average cost of purchase per share to $5.50 compared to $3.00.

What I have shown in the example above is just to show that if you put in a low amount of investment capital, it might be cheap and expensive at the same time. Cheap in the sense that you only required $55 to invest but expensive because the commissions and charges make up a huge percentage of your initial capital outlay.

Well, to cut the whole story short, one needs to balance both the intial capital outlay as well as the charges incurred. I hope to expand on this article in the near future...

So what is the cheapest way to invest? Any tips from anyone?

Flooding in Singapore...Again..

I just read the news and it confirmed my fears. Singapore was flooded again today. Apparently, flash floods hit certain areas and trees also fell at certain places.

I am not surprised. Afterall, when I went to buy my breakfast, I saw a blowhole!

Water was gushing out from a drain cover along the walking pavement and because of the pressure or something, water spurted out like a mini blowhole every few seconds.

What an interesting sight!

Hopefully none of my readers here got caught in the flood while going to work.

Lessons from Silas Marner

Silas Marner is a book written by George Eliot. I just finished this short story which I felt was a wonderful read. In this story, the life of Silas Marner is told.

Silas lives as a lonely waver near the village of Raveloe. He works hard and gains gold and reputation but shuns humanity for it treated him badly once. One night, his stash of gold is stolen and in its place, Silas finds a gift that is more precious....

The way George Eliot wrote this book was wonderful. The way she stringed together words were also perfect in my opinion. What is even more amazing is the way she uses the character of Silas to show the tendency to hoard money amongst human beings. Certain good quotes from the book as follows:

"Do we not wile away moments of inanity or fatigued waiting by repeating some trivial movement or sound, until the repetition has bred a want, which is incipient habit? That will help us to understand how the love of accumulating money grows an absorbing passion in men whose imaginations, even in the very beginning of their hoard, showed them no purpose beyond it."

"His life has reduced itself to the mere functions of weaving and hoarding, without any contemplation of an end towards which the functions tended."

George Eliot has indeed hit many money hoarders right where it hurts. Too often, we treat our work and the accumulation of wealth as the entirety of our lives without giving thought to what purpose they serve.

The end of the story is a sweet ending and I shall not reveal it lest some of you might want to read the book.

World Cup Flops

So France bows out of the world cup together with host country South Africa. Amazingly, France lost 2-1 to South Africa. Even with their Henry and Malouda and Ribery and what nots, they were unable to even get a draw with South Africa!

In this World Cup, I guess we have witnessed what are supposedly "big" name countries struggling to beat the minnows of Asia and Africa. Is this a surprising fact? Or have we just been deluded by the European countries that they are better at football?

Afterall, we are fed regular matches of the English Premier League and stuff like Champions League with footballers like Ronaldo commanding astronomical weekly salaries. We are led to believe that these European footballers are SO GOOD that they deserve their pay and also the additional slots in the World Cup. Just look at how many slots the European teams secured in the World Cup compared to the slots Asia secured and you will understand what I mean.

But perhaps the differences between the big names and the minnows are not so great afterall. As this world cup has shown, the teams can actually be quite well matched. Even North Korea manages to lose to Brazil by just 1 goal. This goes to show that the perceived superiority of European footballers might just be a perception. While Asia, Oceania, N. America and some African nations might be latecomers to the game, they have already caught up significantly with the European counterparts. One can only wonder what it would have been like if Asia was given more slots? Perhaps, we might not see any difference between the big names and the minnows afterall.

Sleepless in Singapore

I think I am suffering from insomnia. I find it difficult to sleep at night. The matter of fact is that I am not tired at all at night. Well, it just feels like my brain is still working on overdrive and I can't seem to calm myself down to sleep.

Sleeping late at night started as a habit that began in national service days and was further cemented during my university days. During those days, sleeping at 3am or 4am or sometimes even 6am at night/morning was common. This must be the reason why I am having sleep problems now.

Or perhaps, a better explanation is that, I am simply a "night" person. I am a walking zombie during the day and at night, I "wake" up. Too bad everyone is sleeping when I am awake.

Well... there is really little that one can do at night. Other than surf the net and catch up on soccer, it is really dull and boring. I sometimes wish I could inject some excitement in my life.

That is perhaps how I manage to start my blogs too. Blogging at night has a calming effect on me. It allows me to make my peace with the day that has just gone by.

Oh well, the street lights are on and I can see them from my window. Trickles of traffic still around. 3 glasses of wine hasn't made me sleepy enough to lie in bed.

Father's Day in Singapore

Yesterday was Father's Day. Or at least it felt like Father's Day.

It was a hot and sunny day as usual and I spent my earlier part of the morning in church. I couldn't really concentrate on the sermon as my mind was wandering around. It mostly went around in circles as I thought of how I am a father now and how it was just so overwhelming.

Being a father means different thing to different people. For me, it has just been an overwhelming experience. I suddenly find myself more acutely aware of my finances and whether I am able to provide the best for my family. If I were to sum fatherhood up in a single word, it will read: RESPONSIBILITY.

I no longer get the freedom to choose my bedtime or when I wake up. I no longer get to choose how to spend the weekends and stuff. It all boils down to being a responsible father and doing activities that are best for my child. The burdens on all fathers are probably the same. And one finds that you sacrifice alot of your time, energies and not to mention money when one becomes a father. It is a very different thing from being a husband to being a father and I must say that I am still getting used to the whole process of it.

On the funny side, dinner was meant to be something special so we ordered some pizza. As the fillings on the pizza was too hot, my job involved eating the fillings on top while leaving the crust for my son to eat. How's that for fatherhood! It was really gross. Me scraping out all the fillings with my mouth and feeding my poor child the remaining crust.