Investing is a tough job for lazy people. There’s so much research to do, so many different, unfamiliar terms, and most of us aren’t experienced enough to know where to start. If only there was someone or something that could do all the tough work for us.
The short answer is – yes, there is! With the help of Robo-advisors, you can now set up an investment portfolio in a few clicks, park your money away and watch it grow. Simply put, Robo-advisors are digital advisory services that replace the traditional human investment manager. You can invest directly with different Robo-advisors and monitor your portfolio whenever you want to.
The main appeal of Robo-advisors is that they help to automate your investments in a low-risk way, and you can invest passively in the long term. Their fees are also much lower than the commissions fees you’ll be charged at a traditional investment brokerage.
Sounds like something you’re interested in? Here are 5 of the best Robo-advisors for you to kick start your investing journey.
Photo Credit: StashAway
If you’re planning to make very large investments (at least S$2 million) through a Robo-advisor, StashAway would be the best platform to do it. This is because for investments over the S$2 mill mark, StashAway charges one of the lowest fees and uses its investing algorithm to adapt to economic trends.
While most of us may not have that much money to invest, StashAway still appeals to the majority of youths because they don’t charge fees for withdrawals, transfers or account closure, nor does it require a minimum account balance.
Photo Credit: DBS Bank
So you don’t have 2 million dollars, now what?
If you only want to invest a small amount, the DBS digiPortfolio is good option with one of the lowest management fees – 0.75% p.a. – regardless of how much or how little you invest. Since DBS is also a household name, you can be assured that your investments will be in good hands. However, you should keep in mind that there is a required minimum investment of S$1,000.
Photo Credit: Syfe
If you want to invest in REITs (Real Estate Investment Trusts), consider Syfe – the only Robo-advisor in Singapore that offers a REIT-specific portfolio. Risk-managed with competitive fees and no minimum investment requirement, the platform also allows for automatic rebalancing and reinvesting of dividends, which are not usually allowed via a traditional broker. So if you’re interested in real estate investing, give Syfe a try!
Photo Credit: Endowus
Want to invest using your CPF savings? You can do so with Endowus, the only Robo-advisor that allows you to invest using your CPF. If you’re able to cope with their minimum account balance of S$10,000, it’s really a great platform for those of you who want to make a significant investment. There are also no fees for transfers, withdrawals, or account openings and closure. Besides CPF, you can also invest in SRS funds and cash.
Photo Credit: AutoWealth
While they might not be the cheapest Robo-advisor in Singapore, AutoWealth is definitely one of the most renowned since they are one of two Robo-advisors that are “MAS-Licensed Financial Advisors”. With this platform, new investors can gain a better understanding of their investment goals, risk preferences, and have suggestions on asset allocation and projected returns.
If you aren’t comfortable with the idea of investing entirely online, AutoWealth also gives you the option to meet your financial consultant in person.
To know more about how you have a holistic insurance coverage, do scan the QR code below for a non-obligatory discussion.
If you’re in your twenties, it may seem a little early to be thinking about life insurance – but in fact, it’s never too early to get yourself insured. With the recent Covid-19 pandemic, many people have learned the importance of having a safety net. If these unprecedented times aren’t enough to convince you to sign up for life insurance, we hope the following 5 reasons will!
1. Healthcare costs are constantly rising
You may think that there’s still lots of time to save for future medical expenses, but the harsh reality is that healthcare costs are constantly rising – as high as up to 18% per annum for private healthcare. Before you go off screaming that all hope is lost, the good news is that you can still cope with hefty hospital bills by ensuring that you have life insurance. In the case that you or your loved ones have an illness or accident, you’ll be prepared to face it.
2. CPF and Medisave won’t be enough
So you’re making regular contributions to your CPF account, but is it really enough? The answer is no. The truth is, when it comes to retirement or unforeseen circumstances, your CPF won’t suffice. In this case, you’ll need to have another way to invest and protect yourself – and one way to do that is by signing up for an insurance policy.
3. Life insurance has risk management characteristics
As millennials have a higher disposable income, we are also higher risk-takers who view insurance as a risk-management product. People will tell you that it’s important to live in the present, but it’s also important to have your eye on the future! Whether you know it or not, we are exposed to risks everyday based on the choices and decisions we make. By having life insurance, we are at least protected against future financial liabilities in the case of sudden demise.
4. The current state of the world
Thanks to Covid-19, economic instability may be something that we’ll have to live with for the next few years. With this in mind, it’s always best to be financially secure and be prepared for a financial crisis or economic crash. Touch wood – but what if you aren’t able to secure a stable job, or fail to have enough savings to get you by? Now, getting an insurance plan sounds like a good idea doesn’t it?
5. It’s more beneficial to buy insurance when you’re young
With insurance, the earlier you buy it, the better it always is. You may be healthy and young now, but as you get older, you will become more prone to critical illness or lifestyle diseases. Getting a life cover for yourself during the early years is often cheaper, and the older you get, the costlier premiums become. Life insurance also covers you against various incidents through different add-ons, but the eligibility to buy these add-ons depend on your health and also – you guessed it – age.
To know more about how you have a holistic insurance coverage, do scan the QR code below for a non-obligatory discussion.
Photo Credit: The Straits Times
CPF – we hear it all the time, and most of us get by pretending to understand what it really means at social gatherings and dinner parties. For a majority of millennials, you may not even know what the individual letters stand for. We know it has something to do with retirement, but how does it help, really? Why is it so important, and why does it sound like a vulgarity when you pronounce it really fast?
First of all, we’d like to applaud those of you reading this for taking the leap of faith towards understanding what CPF is. After reading this short guide, you’ll understand why this isn’t just a matter of concern for older people – and how it pays to know why!
1. What is CPF?
The CPF (Central Provident Fund) is basically a default and legally enforced piggy bank. Originally created as a social security system to help Singaporeans save up for retirement, it has now expanded to cover healthcare, home ownership, family protection, and even asset enhancement.
As mandated by the CPF board (with some exceptions), all employees and employers are required by law to make contributions to the employee’s CPF account every month, depending on the percentage of their salary. If you’d like, you can also voluntarily top up your CPF account using your own funds. Only Singaporeans and PR are required to contribute to CPF.
2. What Happens to the money?
Photo Credit: CPF Board
Your CPF is divided into three accounts – the Ordinary Account (OA), Special Account (SA), and MediSave Account (MA). The money in your OA account can be used for housing, insurance, investment, and education, and your SA account provides for retirement-related needs and products. You can also use your MA to pay for relevant hospital expenses as well as medical insurance products.
Here are the current interest rates of the respective accounts (from 1 July 2020 to 30 September 2020):
OA: 2.5% per annum
SA: 4% per annum
MA: 4% per annum
Once you accumulate your first S$60,000 across all accounts (including S$20,000) in your OA, the interest rates on your CPF accounts will increase by an extra 1%. Hopefully this will encourage you to start saving up now!
3. Can I use the money in my CPF now?
You can in the future, but not now. Generally, the money in your CPF accounts cannot be touched with the exception of housing, healthcare, and insurance. This means that until you’re 55, you won’t be able to see some of this money. When you finally reach 55, a Retirement Account (RA) will be created for you, and savings from your SA and OA will be transferred to this RA.
Knowing that your money will be untouchable for a long time, it’s best to consider other forms of investments so you don’t just have to depend on your CPF.
4. Is my retirement set with CPF?
Unfortunately, there is no straightforward answer to this question as it really depends on your lifestyle, wants, and needs. While the CPF contributions may be sufficient for some in their later years, others may want to live a bit more lavishly. After all, we spend over 70% of our lives working hard, so it’s only fair to want to enjoy as much as we can once we retire.
One thing to keep in mind is inflation, as the prices of goods fluctuate with time and 1 dollar today may not be worth 1 dollar in 50 years. We don’t really know what’s going to happen in the future, so just don’t think so much and just remember to start saving ASAP!
My advice is to get a Retirement saving plan to supplement the payouts you might get from your CPF Life.
5. What happens to my CPF after I pass on?
Photo Credit: CPF Board
If you pass on, the remaining money in your CPF account will be given to your CPF nominees, depending on whether or not you have nominated anyone. Making a CPF nomination is not necessary, and a person without a will would have their assets automatically distributed in accordance with succession rules.
We will stress again that a will itself does not cover the distribution of your CPF savings after passing on; if you want to have your CPF monies to be distributed based on your preference instead of intestacy law, you will need to do a CPF nomination.
If you want to know more about CPF and how you can hack CPF, you could also check out this video
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If you’ve been planning to buy critical illness coverage but haven’t done so, it’s crucial that you read this article extensively before deciding when to buy it, as you may be affected by the changes to the definitions of critical illnesses that will come into effect on 26 August 2020. In a nutshell, the changes mainly involve the tightening of specific critical illnesses, and this would result in more exclusions.
Today we will be sharing 5 ways these revisions may impact you and what you should take note of.
1. To be covered, you must fall under one of the 37 critical illnesses
To be categorised as a critical illness (CI), you have to fall under one of the 37 CIs in the list below. The headings have been revised, and the revisions are reflected in red.
2. To be covered, your CI definition has to match accurately
To successfully claim pay outs, your definition has to be satisfied. As you can tell from the list above, the changes in headings would directly result in more stringent definitions as well. While we may have the sudden urge to start running for the hills, it is slightly reassuring to know that over 90% of all CI claims are only from these 5 CIs – Major Cancer, Heart Attack of Specified Severity, Stroke with Permanent Neurological Deficit, Coronary Artery Bypass Surgery, and End-Stage Kidney Failure.
For more details on the changes, please refer to the LIA Critical Illness (CI) Framework 2019.
3. If you’re an existing policyholder, you won’t be affected
So yes – rejoice because you don’t have to do anything! For those of you with existing insurance plans with the “older” CI coverage, you won’t be affected even after 26 August 2020. As per the previous policy contract, the CI definitions will stay the same, so there is more room for interpretation when a claim is made.
4. If you aren’t an existing policyholder but will be buying coverage before 26 August 2020, you won’t be affected
Future policyholders buying the CI coverage before 26 August 2020 will still be covered under the 2014 Framework, so go ahead and get covered for some peace of mind! The older CI definitions seem to be less stringent, and that may be an important consideration when deciding whether to buy before or after 26 August 2020.
5. As definitions become narrower, it will be harder to claim pay outs
In the event that you or your family members suffer from benign brain tumour, coma, stroke, heart attack, or major cancers in the future, it will be more difficult to claim pay outs due to the exclusions. For deafness, blindness, and aplastic anaemia, the term “irreversible” has also been added, so you can see how the pool of people who can be covered will become smaller.
While there’s nothing much we can do about these changes, we can strive to keep ourselves healthy so we won’t be stricken with illnesses and disease as we grow older. Most importantly, go and get yourself an insurance plan so you will be covered in an unforeseen emergency!
To find out more about Critical Illness Plans, Feel free to contact me wa.me/6596566947. or Simply scan the QR code below:
The perks of owning a credit card are often accompanied by other financial responsibilities such as paying off monthly fees and checking your card’s expiry date. So yes, being a credit card owner is a tough job, but it doesn’t have to stay that way. Here are 5 hacks even lao jiao credit card owners don’t know about, and we guarantee that they’ll make life a lot simpler for you!
1. Request to have your annual fee waived
You’ve heard the term – ask and you shall receive. Most credit cards waive the annual fee for one or two years so new cardmembers won’t have to pay at the start. Eventually, the annual fee will be low-key added into your bill without a heads up whatsoever, and you may overlook some of these fees.
To pre-empt these sneaky annual fees, check the expiry date of your credit cards and note it down on your calendar. Hint: the month indicated on your credit card is the month that you’ll be expected to start paying the annual fee.
Once you’ve been billed, all you need to do is call the credit card company and request (politely, of course) to have the fee waived. Sometimes they’ll waive it, sometimes they’ll refuse; so it’s best to just cancel the card if the benefits you’ve received in the past year are even less than the annual fee.
2. Sign up when there are attractive bonuses
Many credit cards offer juicy sign-up bonuses to lure customers into registering. You know what I’m talking about, e.g. the one offering a free pair of AirPods, or the one giving away a free staycation…
If the bonus is really a steal and you don’t have to spend a cent to register for the credit card, go ahead and sign up! You can simply cancel the card later, or if the bank tries to charge you the annual fee at the end of the year.
3. Use GIRO to pay your credit card bills
Late payments are the worst – it affects your credit standing, incurs rates of up to 25% per annum, and you even have to pay for late fees. If you’re someone who can’t remember dates well or are just horribly forgetful in nature, set up a GIRO arrangement that’ll automatically pay your credit card bills in full and on time. It’s simple and convenient, and you won’t have to worry about making a late payment ever again!
4. Shop through your bank’s online shopping portal
Some banks provide online shopping portals for you to shop from sites such as Agoda or Lazada, and you’ll be rewarded with extra cashback or bonus miles that are much higher than usual. These special portals can be accessed through the bank’s web page for the specific credit card that you use. It may be an additional step in your shopping process, but it’s definitely worth the savings that you can earn back.
5. Avoid paying credit card interest by fully repaying your balance
By repaying your balance in full before the next billing cycle, you won’t have to pay any interest rates. Let’s say the interest is 24% of whatever you owe; if you pay off the balance, you then need to pay 24% of zero dollars – which is still, zero dollars. The billing cycle usually lasts 27-31 days, and you can call the credit card company to find out the exact day on which your billing cycle ends. Smart!
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While we’re still young, it’s easy to think that we are invincible. After all, we are healthy, energetic, and bursting with youth; retirement and old age can seem like a very distant future. In fact, it’s never too late to get yourself insured because accidents can arise when you least expect it – that’s why they’re called “accidents”. One could be careless, or just super suay for being at the wrong place at the wrong time. And worst of all, accidents can be harsh on the wallet too.
So what can you do to ensure that you are protected financially in the event that you do become super suay? A good advice is to sign up for a personal accident insurance policy, which is a type of general insurance providing benefits in the case of accidental death, disability and injury. The specific type and level of coverage depends on the personal accident plan your purchase, so do get yourself acquainted with the type of benefits below!
There are people who need a personal accident insurance plan more than others, and they are included in this listicle. If you find yourself under one of these 5 categories but haven’t got a personal accident insurance plan, you know what to do!
1. Those who are self-employed
Those who are self-employed may enjoy the freedom of being their own boss, but they lack the advantages of company-sponsored insurance. If a person who is self-employed gets into a major accident, they would have to fork out a large sum of money for medical bills and lose wages by taking time off work. By getting a personal accident insurance plan, you will be offered coverage for accident-related medical bills and a weekly income benefit to make up for lost wages.
2. If you participate in sports and risky activities
Athletes get injured – a lot – so it’s no wonder they have a spot on this list. Since athletes are exposed to risk most of the time, a personal accident insurance may well benefit sportsmen. On the other hand, if the riskiest activities or sports you do are typically done when you travel, a solid travel insurance may suffice and there is no need to sign up for a personal accident insurance. Travel insurance will be good enough in covering accident accidents, injuries and death while travelling, and it can also cover lost baggage, trip cancellations and flight delays.
3. Those who are the family’s sole income-earner
If something happens to you and you’re the sole income-earner, your family may be heavily impacted in terms of financial security. Homemakers are also highly recommended to have personal accident insurance because the household may fall apart without him or her being there to assist in family matters! If you aren’t the breadwinner of the family, you can skip the personal accident insurance plan and sign up for an emergency budget or life insurance policy instead.
4. Those who are accident-prone
Some of us may be more prone to slips and falls than others, and constantly find ourselves limping in and out of the hospital like it’s our second home. If this is you, please get yourself some form of protection!
You should also consider getting a personal accident insurance plan if you have elderly parents or young kids at home because these are the people who need coverage the most. In the case of elderly parents, they would need to be cleared during health checks as pre-existing health conditions would not be covered under the plan. Only accidents with no links to health conditions will be covered.
5. Those with risky professions
Are you working in construction, as a bungee jumping instructor, or a lifeguard, perhaps? If so, you require the highest level of protection because your life is constantly at risk! If you’re a hawker, carpenter, technician, or taxi driver, you also fall into this category of “risky professions” and are a good candidate to get a personal accident plan.
If you like to find out more about how you can cover yourself with a Personal Accident Plan
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Is money ever enough? That is the BIG Question!
It is never enough. At least for me.
One of the key learning points during this Covid-19 pandemic is that I need to always have my emergency savings with me.
To be honest, towards the end of 2019, I have lost close to 10 thousand dollars due to the closure of my foot massage store in Serangoon Gardens! But luckily for me, I also sold my Feet Haven Katong in Jan 2020 before the Covid-19 virus became a pandemic. I was able to minimise and contain possible further losses.
Ever since the start of the Covid-19 Circuit breaker, I have been counting on my part-time teaching as a main source of income. I know that a lot of freelancers like actors, emcees, events managers, singers, coaches, have lost their income as gigs, shows, assignments and performances were cancelled.
Luckily for me, I am not just counting on acting as my main source of income. Apart from my part-time teaching with the various universities here, I am also a Financial Adviser with AIA. Thanks to my good friend and mentor Alex Chong, I have taken the various financial tests required in 2018, and by Dec 2018, I was certified as a licensed financial advisor and began to sell protection, personal accident, health and retirement saving plans to my friends and customers.
So, if you like, I am currently counting my income from teaching, financial planning, acting, public relations and referral marketing. I also do adhoc stuffs like pitching production projects, writing a book or trying to stage a play.
It sounds like there’s a lot on my plate. And yes, it is definitely achievable.
Obviously, I have been doing a lot of reflection, particularly on my finances. I have been thinking about how I spent my money, my savings, my insurance, my house, my car, my expenses and my sources of income.
End of the day, money fuel our passion. And passion brings us back our money. So I was particularly interested in knowing the recent Financial Impact Survey for Covid-19 conducted by OCBC bank.
This is not a sponsored post. I chanced upon the report and thought I should highlight some of the key findings there.
OCBC surveyed 1,000 working adults in Singapore to find out how COVID-19 has affected their finances and what actions they are taking in response to the crisis.
Here’s 5 interesting points:
1) Only a third have enough funds to last them more than 6 months if they were to lose their jobs now; more than half have reduced their savings.
This is rather interesting. Assuming your monthly expenses Is $3K, this means that 70% of the people do not have at least $18,000 in their savings account. Based on the 1000 people surveyed, 50% earns $2000-$4999, 31% earns $5,000 - $9,999 and 19% earns $10K and above.
It has already been well established in the financial management world, most experts believe you should have enough money in your emergency fund to cover at least 3 to 6 months' worth of living expenses. This is indeed a worrying trend. Perhaps most people are either not earning enough, or have spent way beyond their earning capacity.
2) Retrenchment and wage cuts were their biggest worries. Some are working harder to keep their jobs or taking up online courses to better prepare themselves.
Based on the survey, 46% of the respondents are worried about retrenchment. This is a valid concern since we have seen many reports about companies closing down due to the covid-19 pandemic. 36% of the respondents were concerned about pay cut.
This is also a key concern as I have had many friends telling me about their pay cuts. Some were even forced to take more no-pay leave during this period.
3) In the same survey, it was also reported that 31% intend to take up a second job and more than 53% attended more online courses then before.
I believe the Covid-19 circuit breaker got many thinking about their job and how recession-proof their profession could be.
Based on a Sunday Time Report dated 14 June, it was reported that Singaporeans deem Artists, Telemarketers, Social media Managers, Business Consultants and Human resource managers as non-essential jobs. So exploring a second income stream is definitely a good income generating strategy.
4) 4 in 10 are worried about having sufficient insurance coverage, yet 12% of insurance policyholders intend to decrease or terminate their policies.
This is very true. I have seen a lot more friends asking about their insurance coverage during this period. Perhaps when we are now caught up at home, and not doing much, we begin to re-look into the existing policies we have. As a guide, based on an insurance guru, Dr Sanjay, suggests that 10x of annual income should go towards our Life Cover. 5x of annual income should go towwrds income protection. 20% of the income should go towards retirement planning and 5% of the income should go towards kids education.
It is no wonder that most people have insufficient coverage based on these formulas.
5) Those in their 20s are the group making the most out of the Circuit Breaker; 64% are taking more online courses than before, and 23% are setting aside more funds for retirement
This is an interesting trend. Much have been said about the millennials being the strawberry generation. This Covid-19 Pandemic could in fact be their first taste of hardship or an uncertain future to come. The percentages suggest that perhaps this group could be more resilient than we think they are. Based on the results, 64% [Against Average 61%] are saying they are working harder. 64% [Against average of 53%] are saying they are taking up more online courses.
38% [against average 27%] have increased their savings. This could suggest that they have stopped spending on luxury items and unnecessary items. 30% [against average 26%] have indicated that they intent to increase their investments. 23% [against 19%] have indicated they are setting aside more funds for retirement. Perhaps the circuit breaker has given them a taste of what retirement could be like, and sparked their curiosity on retirement planning.
So what do I see might be the trend in the next few months?
1) More people will definitely explore a second source of income.
2) More people will go online and start their own personal and professional initiatives.
3) More people will be concerned about their insurance coverage and the lack of it.
4) More people will reduced their expenditures, and spend on things that are more essential at this juncture.
The above statistics and Information are retrieved from OCBC Financial Impact Survey. Thank you for the survey, OCBC. [https://www.ocbc.com/group/covid19-support/assets/pdf/ocbc-financial-impact-survey.pdf]
If you like me to assist you in your insurance planning, and perhaps explore a second income stream; I welcome you to WHATSPP ME. I would love to explore the options with you.
No one really knows the answer.
Until we get there ourselves, it will always be a mystery.
I have been thinking more about retirement during the circuit breaker period. Perhaps, this CB has been a close simulation of what life will be like during our retirement days. Staring blankly at the walls doing nothing? Spending 2 hours for lunch? Zoom calls with friends and catching up on life?
So, when do we retire, really? At age 50? At age 55, when we say goodbye to our OA and SA, and welcome our RA? At age 65 when we can finally smell our CPF Life payout of approximately $1500 per month [assuming we leave $181K in our RA account]. Or never?
The average retirement Age in Singapore remained unchanged at 62 in 2019 from 62 in 2018. This means I would probably work for another 19 years before I can officially enjoy my retirement.
How much do I really need by then? Assuming my average expenses are $1390 today, by retirement age at 65, it would have increased to $2,279. By 80 years, this amount would have snowballed to $3000.
If I need $2000 per month for a period of 18 years ( 80-62); the amount I’ll need will be $2000 x 12 x 18 years, which is approximately $432,000.
Wow, that’s really a huge sum of money. I didn’t really think about it. Looking at the diagram below, based on our earning capabilities, we only have approximately 35 years to accumulate our funds and earnings. Assuming I have another 19 years to accumulate my funds, I will probably need to save approximately $22,736 per year to get there.
Of course, our CPF Life does help. Assuming we have $181K put into our RA account at the age of 55. By 65 years old, your monthly payout should be approximately $1500. This amount will still be insufficient when we match it against the amount $2,279. There’s still approximately a short fall of $700.
This is not including any emergency expenses like medication, major home repairs, etc, and assuming all important insurance needs have been taken care of: Health, Life, Critical Illness and Personal Accident.
The truth is, based on a survey done by NTUC Income on retirement, 6 out of 10 people started saving only at age 45, and starting late is the primary reason for the inability to retire comfortably.
But how can we blame them? Who is to teach us how to retire? Schools? Parents? Society? Friends?
Retirement is really a far-fetched concept for everyone.
We all have dreams to retire early. But in the harsh realities of life, we could possibly only scramble our way there. Why is this so?
Perhaps it’s the inevitable social and political system Singaporeans have been caught into, making it difficult for us to fully lead a financial-free life. Why is this so?
Let me explain.
Most of us were taught to believe that having a degree is akin to having a guaranteed success in life. We spent our earlier years working hard in University, aiming for a high CGPA to get a second upper honour’s degree. If money is not a critical issue, most would have focused on studying and not taking any part-time job. We have lost an opportunity to earn some income here. By the time we graduate, most would be at the age of 24.
What do we do now? Singaporeans take a gap year touring around the world with friends. If not, people with burning passion in life will take a while to decide what they really want. Most will not take on a full-time position, but buy time to slowly understand the harsh realities of ‘adulting’, the painful truth of growing up and taking personal responsibilities for themselves.
Say we get ourselves a full-time job, Fresh grads took home a median gross monthly salary of $3,600 last year in 2019. After paying 20 percent to CPF, the take home is $2880. We assume the expenses for a young adult are as follow:
1) Payment to Education loan [$950] source for Valuechampion.sg
2) Payment to insurance [$432] If I take 15 % for Insurance
3) Payment to Grab, transportation $800 [ $20 x 2 x 20days]
Just looking at the three above costs, an average young adult is probably left with $700 to save. $700!!! How to survive?!
We have not even included our daily expenses like food, shopping items, clothes, pocket money for parents. Let’s not even talk about traveling.
No wonder it is ‘Money not enough’ for most Singaporeans. As one save up with more years of working, we then turned our attention to higher valued items like cars, gadgets and IT stuff. Most Singaporeans dream of owning a car for mobility. Or perhaps as a lifestyle statement. Little do we know that we are buying into a ‘want’ that is depreciating fast every year. The 10 year COE concept has made it exceptionally expensive for us to own a car. For those who aspire to have one, the additional expenses include road tax, insurance, parking, petrol and occasional servicing and maintenance costs.
At least for me, I had my first car when I was 26. I bought a Hyundai Getz and I was extremely satisfied. Little did I know that the reliance on cars have stucked with me till now. I have changed my car later to a Subaru Forester, a 2.0 Litre that comes with higher road tax and insurance premiums, and then a second-hand beetle, all eating into my additional funds and savings, without me knowing. I am now smarter. Recently I bought a 20 year old Suzuki Jimny car at $25K ( After minusing my Beetle trade in), and I just need to service a $25K loan for 7 years. I still can drive it for another 9 years! That, to me, is more financially savvy.
My point is, most Singaporeans do not really know how to plan their finances. Or perhaps the lack of awareness of it has made it hard for us to plan. Most aspire to own a house by 30. If you get married, then owning a HDB house with a value of $300K at age 30 might be easy. If you are single, you need to wait till 35. It should be relatively hard to buy a private property worth $800K at age 35 if you are just an average earner.
I was slightly lucky. I bought my property at the age of 34. I was scouting around for a private property and got my first property at $683K at Flora drive area. It was a dream come true as I always wanted a house of my own. Buying a property was partly due to the limited financial knowledge I have (before being a financial Planner), that property should appreciate over time and that it might prepare me well for old age. Of course, it’s not that simple.
Ok, I think I have been digressing a bit. I guess my point is that no one is born to plan for retirement. Or perhaps it is just a far-fetched notion that we simply choose to ignore? Do we even want to imagine ourselves growing old? Most of us choose to live in the present and adopt the ‘come what may’ attitude.
How many of us have the foresight to look beyond the present and predict what is to come? How many of us actually want to know what is to come?
Hence, preparing for retirement can actually be painful. We don’t want to see our future. We don’t want to even grow old. We don’t want to get there. We just want to be young forever.
Is this possible? We ask ourselves.
But the financial hard truths about retirement remain the same. We can choose to ignore them. If we don’t start planning for our retirement, we might see ourselves facing the same situation met by our older generation. Talk to most pioneer and Merdeka generation folks; a large number of them will tell you that they have failed to plan for their retirement. Some are even unaware of the importance of insurance.
One such person is my dad. When he passed on at the age of 56, he did not insure himself against his life and property. My mum and family were left with nothing and had to strive hard for ourselves. I don’t blame him. He did his best to provide for my family.
What’s your retirement like? Have you started thinking about your retirement? If you have not, you should start thinking about it. Think about what you might do after retirement. Think about the age you want to retire and whether you have the financial capabilities to sustain your daily living.
If you have a sum of SGD181K by age 55 in your RA account, Congrats, you are somewhat covered and safe as you will get payouts from age 65 to 80. If you have not, you need to start thinking of ways to earn that money whether it’s through your property or investments or passive income.
To be honest, if you have been reading and following my train of thoughts, what I am really hoping is to get you to save up for your retirement. One effective and cool way is really to invest in an endowment saving retirement plan. You force yourself to save by locking your monthly saving into a retirement plan.
Retirement Saving Plan
You can enjoy the freedom to spend your retirement the way you want with a guaranteed stream of income over your choice of 15 or 20 years. Plus, every dollar that you contributed is guaranteed at your selected retirement age, so rest easy and look forward to the best years of your life!
Take charge of your retirement insurance plan by choosing how much monthly income you want to receive, as well as the age to begin receiving it – either 50, 55, 60, 65 or 70.
This plan cushions your retirement dreams against the impact of inflation and enhances your retirement income through potential monthly dividends that will increase by about 5% every year, starting from your selected retirement age. To celebrate a life well lived, a potential one-off dividend may be added as an extra bonus to your retirement funds or a token for your loved ones.
You can pay a single premium if you have a lump sum to set aside; or you can spread your premiums over a longer period (5, 10, 15 or 20 years, or pay to retirement age) for regular, more affordable payments.
To illustrate, if you are 35 years old, if you invest $6490 per year for 10 years, by the age of 65, you will get a monthly payout of $500 plus monthly dividend. The cumulative amount received by the end of the term could be close to $236,140 vs the amount $64,900 you invested.
It is a good way to prepare yourself for retirement against the CPF Life which you have been painstakingly accumulating.
Alright, I think I will end here. If you want to know more about the Retirement Saving Plan, do WHATSAPP me via this link WHATSAPP ME
Based on a recent report I read, 50 percent of startups fail in the first four years. 19 percent of startups fail because of too much competition, and another 18 percent fail because of pricing or cost issues. This is in good times.
In bad times, there are two outcomes. To exit and declare bankruptcy if one cannot hold the fort anymore. Or to continue, innovate and sail out of the big storm. Learn from your experience and be even greater. Both outcomes are equally painful.
Nobody says being an entrepreneur is easy. To step out of one comfort zone, be a boss of your own, takes a lot of determination, courage and strength. To start a business is easy, to sustain and ensure its long-term profitability, is tough.
It is perhaps the notion of the unknown, the risk, and the potential returns, one might get, that makes entrepreneurship exciting, rewarding and thrilling.
However, not everyone is cut out for that. One crucial trait of a successful entrepreneur is a ‘Never Say Die’ attitude. Jack Ma, was rejected by Harvard for a whopping 10 times. For one, rejection and failing are simply an inevitable part of the process. Virtually every success story entails (often multiple) stories of failure. What’s important is that like Jack Ma you pick yourself up by the bootstraps and learn from the rejection.
I cannot imagined the struggles and challenges faced by all the business owners right now. The lockdown across the globe has been ongoing for a while. Essential services are continuing and most companies have arranged for their employees to work from home. Tuition centres and Schools have transited into an online teaching delivery mode. Spas, Aesthetic clinics, Beauty parlours, gift shops, hardware shops have all stopped operations. The bare essential services are on-going to serve the basic necessity needs of Singaporeans.
One of the motivations for being an employer is the potential profits one could gain from a business. Contrast that to an employee, an employer aka boss will earn a director salary or/and choose to take the profits when the company is profitable. The returns are potentially higher if the business does well. As higher risk equates higher returns, the draw for every entrepreneur is to scale his business, employ the right employees, and get exponential earnings from the business. One could be a sole-proprietor, in a limited partnership or start his or her own a private company. All have its own financial and legal implications.
High risk also means a possibility of higher losses. How can we expect to win all our battles? Even Goliath lost to David. It is wishful thinking that we will succeed every time in business. Notable successful entrepreneurs like Bill Gates and Steve Jobs have had tasted failure many times before they could see the light out of the tunnel. Successful and high-profile entrepreneurs in Singapore has had their five minute of fame, and we don’t hear from them anymore.
I spoke to a few business owner friends before I wrote this article. The sentiment across the market is pretty depressing. Most are not upbeat and remain cautious and worried about the next few months.
I even had a chance to read one reflection written by a female entrepreneur. She has written her thoughts about covid19 and her business. In her reflection, she described how puzzled and dazed she had become, almost crippling, but she pulled herself together to think about eight ideas which she can slowly implement for her company. I see fears in her eyes just by reading her notes.
Another gungho entrepreneur friend who owns a café said, ‘KNNBCCB’ is what I am thinking right now. I am taking the time to build new capabilities for my business’. I asked him about the government measures and support and whether they are helpful, and he opined that certain policies are not foolproof. One example is the property tax rebate given to landlords. He said that there is currently no website to check the exact rebates that should be passed down to tenants.
Another friend talked about the ‘new normal’ behaviour which we are all experiencing now. ‘Client behaviour might actually change and they might want the online lessons instead of face to face, as it saves them time and money to study at home’. This childhood friend, who owns a physics tuition centre, is concerned with business continuity, and how consumer behaviour might change once this pandemic is over.
Another friend who is in the spa business predicts that his business might be affected by 50% after the circuit breaker. People might still be concerned about getting infected and reduce their time outdoors. He continued by saying that cash flow is definitely at the top of many entrepreneurs’ minds right now. ‘How do we ensure that we have enough cash flow to pay our rent, salaries, variable expenses, in the next few months’, he added.
The same entrepreneur, who texted her notes to me, made an interesting comment. She said ‘In the past, a traditional company creates a turnover of 100 million with the help of 1000 employees. In the age of technology and in current times, in a virtual world, an online company could have a turnover of 100 million with the help of only 100 employees’.
Indeed this was a thought-provoking point. The perils of technology is coming closer to home than we imagined. We embrace it so closely without knowing that one day, technology is going to take us over, sooner or later.
Look at the number of zoom calls we are making, the self-delivery robots at restaurants, automated cashier systems, chat bots, AI, VR, and the list goes on.
This is an opportune time for everyone to re-evaluate his or her life. Businesses need to re-think their business strategies , and find innovative ways to survive through e-commerce and online platforms. Self-employed and freelancers would need to think about learning new skills and possibly venturing into a second income-making model. Employees will need to think about their value they bring to their company. If you are an employee and idling at home right now, it means that you might be dispensable after all. What's fearing this group could be potentially rounds of retrenchments after CB. In any case, no one is indispensable.
So who’s the hardest hit during such periods. It is unfair to point to any group without real statistics and figures. We have heard a lot about freelancers and self-employed losing their gigs and projects during this period.
Let’s not forget the business owners. They are a courageous group of individuals who have put a step forward with meaningful pursuits. They had created businesses and provided employment to a large group of workers. They have created meaningful USPs, products and services that have impacted the lives of people and society. They have contributed to GDP and the larger economy of Singapore.
Perhaps it is also a time to re-look into how we treat businesses/ brands as consumers. Do we throw our weight around thinking ‘consumers are always king’ and demand even the slightest perk we can get from our purchase? Do we remain as keyboard warriors, hiding behind our laptops, and sending anonymous complaints around?
Let’s give them some slack and show our support during this period.
They are equally at the losing end during this covid19 pandemic.
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Of Money, Passion and Life.
I was raised in a middle-income family. In fact, I won’t even say that my family is rich. My dad passed away suddenly when I was 21, and we were left with the bare minimum. My mum had to work really hard to bring up her 3 kids. It wasn’t easy for her and for the rest of my siblings.
My dad was not rich, but he was certainly a loving one. His richness came from his tender loving care and concern towards his children. Being the middle child, I always felt neglected as the attention has always been on my younger sister, Wendy. All is good, as I still love her the same way my dad and mum do.
My dad has his own way of loving me. I remember him driving his second-hand Hyundai car and fetching me to school constantly when I was in my P5 and P6. I was having intermittent headaches frequently and had to leave class halfway. Without complaints, my dad will always wait outside the school gate as I quietly walked out of school. He would always smile widely as he extends his hand towards me.
The concept of money was never fully ingrained in me. My dad will always pass me some pocket money to buy my favourite snacks. Kaka Chicken snack, a favourite childhood snack will always be my first pick. This snack is a huge hit in the 80s and 90s, as the crunchy and salty snack deeply satisfy my taste buds.
What can $2 buy me?
To be given $2 for pocket money is a luxury. I will always think about what I want to eat at the canteen during recess time. I remember yearning for chicken rice at Xishan Primary often in class. My stomach will growl each time my scary English teacher walks past.
After a hearty meal, I would be left with 50 cents. I would always contemplate between saving up or buying my favourite drink. With the last 50 cents, I will always go for my favourite Yakult Apple drink and I will be left with no money.
I believe this is a common narrative amongst primary school kids in the 80s. Times were not the most ideal, and every kid finds his or her own way to survive childhood. We were contented with little things; catching spiders, playing hide and seek and hanging out at the void decks doing nothing.
Singapore has slowly progressed into a first-world developed country. I was 24 and clueless about what to do next. I knew I always wanted to perform, but never knew how to start. I did not study in performing schools like Lasalle or Nafa. I wasn’t gutsy enough to make that choice. I took up a Business marketing diploma in Ngee Ann Polytechnic followed by Mass Communications from RMIT University (SIM). I knew I wanted to be in the media industry, just not sure on which area and capacity.
Then came star search 2001 organised by Mediacorp. I never imagined myself getting into the top 12, on my way to realise my dreams; to act, to perform, to be a celebrity. It was a dream come true. Six months of training and publicity got us recognised, everywhere we went. But it was short-lived, the competition ended and everyone went our own way.
An employee mindset
From 2003 to 2009, I spent a good six years becoming your typical employee. My concept of work was a traditional one. I subscribed to the notion that earning a stable income will help me progress well in life. As I have studied marketing, most of my full-time jobs involved building brands, managing profit and loss for product lines, developing advertising campaigns, organising roadshows and exhibitions, etc.
I was also able to travel to many countries like India, Bangladesh, Cambodia, Vietnam, China, Myanmar, Japan, USA. In fact, I truly enjoyed my time as I was given the opportunity to work on regional and international marketing campaigns for my companies I worked for.
One of the best trainings I had was with Panasonic Singapore. In particular, I learnt many good lessons from the Managing Director, Paul Wong. He was a dictator, no doubt. Everyone was scared of him. He reminds me of Donald Trump, in a good way; someone who really gets his way around.
Being an employee has its merits. I was able to observe great leaders in action. As long as we set our goals and achieve them, we are good. It was not difficult. As long as you follow the corporate rules and regulations, work hard, you will get your promotion one day, I tell myself.
I wasn’t happy even though I was able to earn a good salary and have saved enough to buy my first car. I was travelign frequently have even earned myself a Master Degree in Mass Communications at the age of 30. I was tired of the corporate life and questioned whether it was what I wanted for the rest of my life.
This was when a book changed my life. I picked up Rich Dad Poor Dad and was exposed to the cash flow quadrant. I was deeply moved and intrigued by the 4 fundamental ways of making money!
Employee : where you have a job; the amount of active work determines your income.
Business Owner: where you own a system; your income does not depend on active work.
Self Employed: where you own a job: The amount of active work determines income,
Investor: Where you own investments: your income does not depend on active work.
Lecturer and Entrepreneur: Fundamental Change
With this concept in mind, Interestingly, I became a lecturer at age 31 and an entrepreneur at age 32. How could this be possible, you might ask. Looking back, a lot of things have been impossible. I never imagined myself becoming a lecturer. Friends who know me when I was younger would attest that I am not the academically strongest. I am always that guy who provided good inputs and psychological support for group projects, but never the smartest. So, to become a teacher?
At 32, I wanted to own a business badly. I was looking around and brainstorming what I could do. I wanted to start a café. I thought it would be a cool thing to do. I checked out a few ‘businesses for sale’ websites and actively talked to a few potential sellers. One day, I found out that a lady was trying to sell her foot massage business. That was in 2012. Together with a close friend, we met the seller and agreed on a price. It was around SGD35K to take over a one-year old business, Feet Haven Reflexology.
I was excited about this new venture. I can now call myself an entrepreneur, and really work towards a more ‘business owner’ cash flow quadrant. The beginning was tough. My business partner and I spent endless nights discussing about how we can build the business. As it was my first attempt as an entrepreneur, it was one of the most stressful times in my life.
There were really thousand and one things to do as a business owner. You are in charge of everything. The first few months were tough. We hired new masseurs. We redesigned and redecorated the shop. We were at the shop every day to ensure the smooth operations of the business.
Our hard work paid off as we started to see profits stream in at the start of our fourth month.
I started to realised that if we don’t put our first step forward, we will never know whether we can make it. If I had second guessed myself, I would never have started. There could be many people in this world who are trying to change things and do something different. What’s holding them is perhaps just one word: FEAR.
And fear is real. The constant ‘What If’ keeps bugging our head. And that’s when we buy into the notion of status quo. ‘Why don’t we just play it safe’? ‘I have been in the company for 5 years, why not another year’? Such thoughts are constantly mulling in our minds. It’s human nature, I get it.
But if we were to think this way for the rest of our lives. We might regret ourselves not pursuing things we once dreamt of. I profess I had made a lot of risky pursuits from age 32 to 42.
And here goes:
1) I opened The Influencer Network with a Blogger Friend, running a second company alongside my Foot Massage Business. We started with only $5K capital.
2) I took over a Nail Spa business at 17K and managed it for 3-4 years before the government ‘forced’ us to close down. This was due to the change of rules where nail spas are expected to apply for licence as well.
3) I opened a second- and third-foot Massage branch at Serangoon Gardens and Bukit Timah respectively. Friends will know that I closed the Bukit Timah branch within one year.
4) I took up the courage and went back to pursue acting at the age of 37. I was once scolded by a director who said I shouldn’t be acting at all. I have used this incident to push myself further.
5) I became a financial planner at the age of 41. And I am still figuring out my way.
Looking back, if I have chosen to rest on my laurels, I would not have made things happened. I could be a marketing director for an established business/brand by now. But I might be facing all the pressures coming from the economic slowdown and covid19 pandemic.
A lot of us are afraid to take steps and make changes in our lives. I can fully understand. Even now, I am constantly reviewing what I truly want to do for the rest of my life.
Amidst the covid19 pandemic, I had the time to reflect and I knew it has to be these three areas:
I want to be a serious actor. And I have been constantly going for auditions and improving my craft. I want to be a good lecturer. And I have been keeping my teaching roots by taking on part-time teaching assignments with Curtin, Temasek Polytechnic and MDIS since 2014. Managing campaigns for clients keep me rooted in the PR and advertising industry. I want to be a good financial planner. And I have been trying to improve my personal selling skills.
Is it possible to do so many things all at one go, a lot of people ask me? I really don’t know. Would I be happier just concentrating on one full-time pursuit? I suspect not. Would I be richer concentrating on one-full time, I suspect not.
I am happy with my own modus operandi for now. All I know is that if I set my mind on something, I need to make it happen.
My rich dad has taught me about the 4 cash flow quadrants. He has opened my mind about the 4 fundamental methods of earning a living. For the last few years, by not being a full-time employee, I was able to travel to many places without having to worry about my work. I remember the times I travelled to Bhutan, Bali, Maldives, UK, Italy, Turkey, Japan, etc and I know it is all worth it. In a way, I was able to relieve myself from all other unnecessary work stresses and demands, and concentrate on what I truly love.
I was also able to pursue my love for acting and volleyball on a more intimate and professional level. All these are possible because I chose to make it happen.
I will however never forget what my (poor) dad has given me. To be compassionate even to the poor and needy. My dad might not be the richest. But his heart for people will always remain in my heart. I might not get there in my altruism or philantrophy, but in the current covid19 period, let me remind myself to always stay true to myself and to do my little part to help whoever who might need my help.
My dad visits me once in a while in my sleep. Each time he visits, my mind is even clearer on what my life is called for. I hope he does it more often, and I will keep thanking him for whatever he has given me thus far.
If you are facing a crossroad in your life, or unsure about what's ahead for you, feel free to contact me at whatsapp 96566947. I would be more than happy to listen to you and share with your my thoughts.
Official Website: www.iamdennistoh.com
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About the Author:
As an Actor Model Entrepreneur, Dennis is on a personal Mission to encourage people to Explore More with their lives. After reading a book titled ‘Rich Dad Poor Dad’, Dennis vows to stop working full-time for companies and began his entrepreneurial journey, starting a foot reflex brand, a nail spa, and an influencer marketing agency. Dennis believes in exploring his life options to the fullest. After a short stint in the entertainment scene when he was 24, of which he entered into Singapore Star Search final 12, and after a Long hiatus, he started his modeling and acting career once again in 2015. He is now the face of several notable local commercials, and was also involved in 2 mediacorp shows from Channel 8. Amidst all these, he is also a part-time lecturer with Curtin Singapore, MDIS and Temasek Poly and a Financial Planner with AIA.