Chit Chat With Susurrate: Saving $19,000 In One Year

The following is a guest post by Susurrate. He's just like any ordinary guy out there but manage to save close to $19,000 in just one year. Here's his story and how he did it:

Hi fellow readers of SG Young Investment. Recently the Author has been writing about frugality and I guess I could write something as well.

Just a background information for you. I am currently 26 and single and I do go out and have fun with my friends. I come from a low income family, in fact, my parents are WorkFare Income Supplement recipients.

Through sheer hard work and frugality, my parents have supported my education up to a diploma. I am currently working full time earning a middle income and pursuing a part-time degree.

Being brought up in a low income family have allowed me to pick up frugal habits from my parents. Since young, I have been saving money to buy what I wanted instead of asking from my parents, so I guess that’s how I learnt early the value of money.

While I earned more than my parents combined, I do not splurge on luxury or status. Because of this habit, I find myself spending little and have a lot more disposable income than what the media portrays.

Rather than telling people that they should do this and that, or they should not do this and that, I prefer to show than to tell. I have been tracking my expenses for the past 2 ½ years and these are the numbers as well as my take home pay for the year of 2014.

I’d say I’m fortunate to be in a company where my lunch is provided. I have a bento set everyday IF I opt in, instead of rushing and competing with the lunch crowd. I also prepare my breakfast at home and have dinner at home when I have nothing on after work. Clubbing and smoking are not my cup of tea as well.

Total Take-Home Pay:	$38,656.31
Home related expenses:
Phone and Broadband	$710.88
Repairs	$74.84
Transportation:
Public Transport	$1,323.07
Food:
Groceries	$155.95
Dining Out	$675.37
Entertainment:
Vacations	$283.00
Movies	$53.50
Books	$85.01
Gifts / Weddings	$478.54
Others	$96.66
Insurance:
H&S	$781.70
Life / CI / TPD	$3,718.08
Personal Wellness:
Clothes & Shoes	$32.85
Haircut	$80.00
Wallet (one-off)	$56.58
Education:
School fees	$3,814.55
Stationery	$7.46
Parents:
Medical	$526.05
Allowance	$6,000.00
Income Tax:	$19.00
Total Expenses:	$18,973.09
Unaccounted Expenses (5%)	$948.65
Total Savings:	$18,734.57

So there you have it! A savings of $19,000 a year or almost $100,000 in 5 years for a middle income fellow, if I can keep this up (I could probably save more as I would no longer have expenses for my degree). Add another $15,000 in CPF contributions from my employment and I am $34,000 wealthier for the year.

If you notice, I spent more on things that matter, like parents’ allowance and their medical check-ups and outpatient bills, my insurance policies, and building meaningful relationships with friends. I believe that being frugal is all about spending your money wisely, not wasteful spending.. I am grateful for everything I already have.

Lastly, I’d like to leave a quote,

“The rich man isn’t the one who has the most, but rather the one who needs the least.”


My Thoughts:

The guy is a friend whom I've known for the past few months. He's the same age as me and we're on the same journey to financial freedom.

Like him, I do not come from a rich family. I too studied part time for my degree and paid it up completely with the money I earned from my full time job. Even after paying for my school fees which is a five figure sum, my financial position is still healthy and I'm on the way to meet the target of 100k savings in 2 years time. I'll update my income and expenditure on a separate post as we approach the end of 2014.

What has your savings been like for the whole of 2014? Hope you enjoyed the chit chat post. There'll be more to come. Stay tuned!

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Related Posts:
1. Chit Chat With a 17 Year Old Young Couple on Financial Planning For The Future

Chit Chat With a 17 Year Old Young Couple on Financial Planning For The Future

I wanted to call this an interview but decided to call it a chit chat instead. I've received quite a lot of emails from young students from as young as 15 with regards to planning their finances and investing. I've always been curious on why some of these young students will realise the importance of financial planning while others will not.

Today, I would like to feature a young couple who's studying in a local Junior College. Yes, you heard me right. They are a couple who emailed me separately and I found out their relationship some time later. The interview questions were answered by the girl herself but they did discuss together beforehand. The below ME represents the girl and HIM represents the guy. They requested to be anonymous. In this interview, you'll get to see what triggered them to start financial planning early in life and how they balance it with their social life.

Let's get started!

1) Both of you are young and already want to start planning for your future. What triggered the thought of it?

Me: Hahahaha mine I don't have one particular trigger it was like a train of thoughts? So like one thing led to another then I suddenly felt motivated to plan for my future.

Ok 1. was that I really want a car in future. My family's car's COE expires next year, before I can actually get a license and drive it so that sucks and I really cannot imagine life without a car. I guess I am pretty pampered. Car to me is not a need but it'll be really convenient if I own one in the future haha. I understand that COE in Singapore is insanely expensive so since I have the benefit of still being a youth I should start planning like right now to reach my goal of owning a car even sooner haha.

2. Was that I worked as a banquet waitress so I witnessed many weddings and I can't be sure if it's true, but Singaporeans are getting married later and later haha. I don't know what's the actual cause of it but I guess the expense of wedding and the life after that is really huge so similarly, since I have the benefit of still being a youth I might as well start planning now.

Him: His parents didn't plan their finance properly which in turn affected the family's living condition. I guess in general, we both realised the importance of managing our finance and planning our future in order to have a future of our dreams.



2) Are you a spender or a saver?

Me: Spender I guess. I think my priorities are really wrong. I spend at the things like clothes bags and save on like food but I'm coping so I guess that arrangement's ok with me haha.

Him: Spender too HAHA he spends mostly on food but he works more than me in the holidays and his earnings are > his spendings so all is good too haha.



3) As a young teenager living in Singapore, there's so much entertainment around and food is getting more expensive especially for young people who likes to go to cafes. Are there any savings tips you would like to share? 

I myself really like to explore Singapore's cafes and people like my sister and her friends really often ask me where I get my money to go cafes. Last year Dec I came up with this plan: Stop going franchises like pasta mania, MacDonalds, Nihon Mura etc when deciding to go for casual dinner.

For e.g. if I were to decide where to eat for dinner tonight with my friend somewhere at my nearest shopping mall, I'd go for kopitiam food (around $2-$3) instead of pasta mania (around $7-$10++) so I can save the money to go cafes when I really wanna relax with my friends/bf. I like to either eat really budget at kopitiam or try new cafes so I'll cut the in betweens (the franchises). Also, I'd cut down on like Starbucks, Gong Cha which people like to buy and drink as they shop haha.

This way I not only save money I cut down on sugar too HAHA. I feel that since I really love exploring new cafes in Singapore, not just for the food but the ambience, I have to make adjustments to my lifestyle so on days where I just want a simple dinner, I'd try and eat cheap or at home. As for my bf, he splurges on food and I'm trying to instil this thinking into him haha.



3) Finance is a boring subject to many people. What made you guys interested in it?

Hahaha well I guess the idea of achieving the life and dreams we want that motivated us to do something about our current lifestyle and planning which includes understanding finance better haha.



4) Where did you learn most of the personal finance concepts such as saving money, investing etc? Does your school offer such classes?

I think in the past, my school (like my pri school) did teach us how to save. But of course it's those 'save 20% of your pocket money' kinda thing haha. As I grow older I manage my personal finance like saving money. I don't have a systematic way to save money which is not exactly ideal...... hahaha oops. I guess the way I save is to like have a minimum amount of money in my bank e.g. maybe this holiday I want a certain amount of money in my bank so once it's around that amount I'd stop withdrawing money from my bank and wait for my next allowance instead hahah. But recently I started a savings plan which I'll elaborate on it later on!

As for investing, I only got interested this holidays cos I always thought that was an adult thing. It was until this holiday my boyfriend told me there are actually people who invest at our age so that got me interested haha. My parents did a bit of investment. More last time until something happened so now they only invest in those stable ones? I'm not really sure either but I know my parents have some experience in it so I talked to my mom who referred me to her financial adviser so I guess from now on I can consult that financial adviser cos she's now my financial adviser too haha. Oh and of course, both of us also read up online (e.g. your blog) about personal finance concept. Nah as far we're concerned our school don't offer any classes on personal finance concepts haha.



5) Are your peers interested in finance stuffs too? If not, are there any ways to get more young people like you to get interested in planning their future? 

I guess in general, they would want money (of course hahahah) but they don't really know how and aren't exactly motivated to search for ways etc. Most of them are choosing the 'trouble-free' way out which is to work to earn money but they are unaware that that's a temporary solution and that planning/saving is more important for the future.

I guess most of them ( I admit I used to be like this too) are more concerned about life now than life in future. I feel that there's really minimal anyone can do to get young people interested in planning for their future. There can be talks and speeches by successful people, by finance consultants etc etc but i think their growing environment and their character plays a big part. If they are surrounded by like successful people for e.g., they would naturally want to be the same.

Then again, character acts as a factor as well, one can be offered many opportunities but if he feels contented with his life or something along that line, they wouldn't wanna do anything more. I don't know if I'm making sense to you haha I'm bad at words. I think the most direct and effective way to get someone interested is when they really look around them and realise there are many successful people and they want to be like them. If they are really uninterested, the talks, speeches, shows, any form of moral suasion will only bore them.


6) Are there any other thoughts you would like to share with the readers here?

Hahahaha I guess the takeaway of this whole interview/post would be, if you fail to plan, you plan to fail, and that applies to not just finance, but everything in life :)



My Thoughts:

You can see how bubbly the young girl is. I enjoyed interacting with them and am encouraged by their energy in life.

For myself, I realised the need for financial planning much later than the two 17 year old students above. I was still obsessed with the camera phones that were in trend at that time. I even bought a $300+ phone for myself at the age of 17.

To realise the need for saving money at a young age is good. Even though they may not have much money, the act of putting aside even a small portion of their allowance will instil a good habit of savings which goes a long way. 10% saved today may only be $10 but it will be a few hundred dollars when they start working.  The next part is to create a financial plan which is achievable for their long term goals. The purpose is to balance saving and spending money. We don't want to end up saving too much and be a miser or spend too much and worry about money later.

Money is not just an adult thing. Young people can start managing their own finances early in life too. If you're a student and reading this, I hope it will encourage you to start your journey to financial freedom too. Nevertheless, for young students, studies should still be prioritised and career planning is important too. Having a good income will give you a good headstart in life. This will be discussed in the next blog post.

Christmas is just one day away. Here's wishing everyone Merry Christmas and a joyful holiday ahead!

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World's Simplest Market Alert Tool - Interview With Daniel Chia, Professional Investment Manager and Co-Founder of Call-Levels

Recently on Monday, I met up personally with 2 of the co-founders, Daniel and Cynthia, of a new app called call-levels. In this post, I'll be featuring Daniel Chia, who has a vast amount of experience in the financial industry. Learn from a professional investment manager on what he has to say about making money from the markets. Learn how a newly launched free-to-use app can help us in our investment and trading decisions.

Credit: https://www.call-levels.com/

About Daniel Chia

Daniel Chia has always been fascinated by numbers. A Cambridge graduate who earned his Masters in Mathematics and Statistics from Harvard University, Daniel spent nearly a decade at Sovereign Wealth Funds and Hedge Funds.  He was a key part of the Quantitative Trading Team at GIC, and was a Portfolio Manager at Asia’s largest systematic macro hedge fund, where he built and traded systematic models predicting and exploiting market sentiment and bias. The experience Daniel has gained through his academic and professional career has helped him identify and build a tool to overcome the largest obstacle standing in the way of good investment decisions.


1. Tell us more about yourself and how you got started in your career in the financial industry?

I’m Daniel Chia, a professional investment manager for the last 10 years with a life long interest in portfolio management. I’ve always been interested in finance, first from a mathematical perspective (I’m a math major), but I’ve gained more experience, from a behavioural perspective, i.e. how sentiment and greed/fear can affect your approach to the markets.


2. What are your views on trading vs investing? Many young people want to earn quick money from trading. Do you have any advice for them in terms of growing their wealth?

To me there is no difference between quick money and slow money. The most important thing in the end is ensuring that your strategy can take risk smartly and make money.

I think that the difference between trading and investing is:

a) holding time of assets and
b) liquidity of assets.

The risks are different. I’ve seen many traders burn out as they are 24/7 in the markets and also long term investors panic when the market turns and liquidity dries up to the point that they are looking for a return of their capital, not a return on capital. As you grow your wealth, it helps to know what risks you are most comfortable with.

Traders quickly learn that the markets have no rules, and the only rules that can be controlled are those that the traders impose on themselves. This can be overwhelming for new beginners as they cope with the psychological impact of taking risk and potentially losing money. The priority of any trader is to survive. This means being able to adapt to the markets, and eliminating as many rookie bad habits as possible. Each error eliminated is money saved, and each dollar saved can be put into taking risk. What is the one bad habit that most beginner traders make?

They Can’t Stop Watching Prices!

This is counter-intuitive: every trader will tell you that “Each Trade is Important”. When I started trading, I too took this adage literally and tried to watch prices all the time. Literally, all the time, in front of a Bloomberg, staring the numbers flash green and red. I was looking at charts, calculating profit and loss all time. I realised in due time that this was a bad habit, and possibly the worst habit I could have. It made me unable to turn off, built anxiety, and worst of all, caused me to doubt my own investment strategy. It sapped energy from when I really needed to be active, during major market moves which occur only during 5% of the time I spent watching markets. This problem becomes more dangerous with the introduction of mobile trading apps, meaning that traders are now able to watch prices wherever they are. Many traders are now unable to switch off from prices, and the pressure to adjust on the fly means they deviate from their strategies and trade more frequently.



3. What are your own personal investments or trading strategy? Are you more short term or long term?

When I started trading I was reactive, finding market strategies that reacted to tactical events and changes in outlook and sentiment.

As I gained experience I found it more sustainable to be predictive, building longer term themes and strategies in the markets and finding times when overreaction occurs for good entry and exits. I’ve been able to build quantitative models that can do some of the work for me, which really helps.

Now I’m trying to be more proactive, the best trades in the market are those that I personally can influence and improve, and I am trying my best by setting up and leading a start-up - Call Levels.

4. How would the new app, Call-levels,  help us in our own personal trading and investments?

Call Levels is the simplest tool you can have that fulfils the most basic need of the market. To be able to set price alerts easily and receive them reliably is something everyone needs.

To survive in the markets you have to make sure your tools are simple and work well. And we aim to be the most reliable tool in the market. We have had fund managers tell us that alerts in Call Levels were comparable to their $3,000+ a month Bloombergs - we’re constantly trying to improve the product to make it even better!

Call Levels is extremely simple, you cannot price watch, because there are no flashing prices, but you can set prices so that you can be aware of the market, but only when it moves. Price watching, especially when there is nothing happening in the markets, is bad, it tires you, makes you anxious, and takes your attention away from the 10% of the time when the market really moves and you need to be there.


5. Where can they get the app now?

It is out available on iTunes for iOS users. bit.ly/call-levels. Any feedback will really help at this early stage!


6. The app will be available for Android users as well as the introduction of equities and indices feature soon. When will it be released?

We are targeting Jan 2015 for Android with Equities and Indices.


7. Lastly, since you’ve been in the financial industry for many years, do you have any advice for young people who would want to join the financial industry as their career?

Be honest, humble and keep trying to learn and find out more. And keep in mind that wealth is more than money, do remember your health, friends and family. To help that do try Call Levels, we watch the markets so you don’t have to!


To find out more about the Call-Levels App, do visit their website at: https://www.call-levels.com/

They are looking for feedbacks on the App itself and also any suggestions on additional features which you think is useful to be included in the App. Comment below to leave your suggestions or send me an email at sgyounginvestment@gmail.com.

I think the app is something that is very useful and easy to use for us who trade or invest in the markets. I'm personally looking forward to the equities feature which will be released in Jan 2015. We were also talking about the possibility to include additional features such as alerts based on P/E, P/B ratio or any others. Feel free to give your suggestions. Share it with your friends and family. Download and try out the free app today!

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An interview with property soul plus new book launch: No B.S. Guide to Property Investment

Investing in properties is one of the many ways to create passive income and you can even get rich through this investment. When we think about property investment, there may be many questions on our minds. When is the best time to invest? How much money do we need? Is it risky? What's the strategy to successful property investment?

I'm privilege to have an interview with the owner of property soul and feature it in my blog today. She's a property enthusiast who bought her first condominium unit for rent in 2002. In the next 4½ years, she built up a portfolio of five private properties. By 2008, its total value had more than doubled. In 2010 and 2011, she sold four of the properties, realizing a net profit of 80 to 120 percent.

This year, she published her first book titled " No B.S. Guide to Property Investment – Dirty Truths and Profitable Secrets to Building Wealth Through Properties." In this interview, she will share with us more on property investment and what we can expect from her new book.

Q: Tell us more about property soul and what is it about?

PropertySoul.com is a personal blog set up in 2010 with two objectives in mind:

1. To share my personal experiences as a property investor in Singapore; and
2. To exchange ideas with fellow investors on accumulating wealth through properties.

PropertySoul.com has by far published over 120 blog posts which are often being reposted at Yahoo News, TheFinance.sg, Singapore Investment Bloggers, Propertyguru.com.sg, Singapore Daily, Propwise.sg, Singapore Business Review, Temasek Review and other wealth blogs.  
       
I am grateful that my blog has a regular group of followers now. We also organize Meet the Blogger sessions for networking. The next one will be held on April 27.              
 

Q: How and when did you get interested in property investment and what got you started?   

I come from a very humble background and I have dreamed of owning my own place from a very young age. I started researching about private properties after I relocated myself to Singapore in my 20s.  And I finally bought my first private property for rent before the age of 30.
              

Q: How would you advise a young person, with zero experience, who wants to invest in properties? What are the risks involved? 

1. Don’t buy what everybody else is buying.
2. Don’t buy what the ‘so-called experts’ recommend.
3. Don’t trust any get-rich-quick program.
4. Don’t believe in buying with little or no money down.
5. Don’t think that it is so simple to buy with crowdfunding.

Because you can end up holding an overpriced property, a troubled property, a white elephant, or a negative equity (when property value falls below outstanding loan). It can take years, decades or forever to breakeven.

The only formula to accumulate wealth through property investment is to ‘save before invest’, and ‘research before purchase’.

             
Q: What are the factors you look out for when you invest in a property? Is there any strategy to be successful in property investing?  

1. An attractive net monthly ROI (Return on Investment);
2. A high quality and well-maintained project;
3. A good location (in the eyes of my prospective tenants); and
4. A good resident or tenant profile.

For strategy, I like to call it the winning formula STAB (Specialization + Teamwork + Analyses + Back-up plan).
1. Specialization: Focus on your strengths and build your priorities.
2. Teamwork: Build a strong team with your investment partner, property agent, mortgage bank, conveyancing lawyer and accountant.
3. Analyses: Conduct your own research and analyses.
4. Back-up plan: Have a contingency plan and more than one exit strategy.
                                           

Q: Would you share with us what properties you have in your investment portfolio currently? Do you invest in overseas or Singapore properties more? 

Currently, I have sold all my properties in Singapore except the one I am staying in now.
To make real money in any investment, you have to move in early when things are cheap. Make your money, exit early and pass the risk to the excited latecomers who can’t wait to get in.

I have studied the property market in a few overseas countries. I will only buy foreign properties:
1. When the timing is right;
2. When the return is much higher than what I can get in Singapore;
3. When I know more than the locals in that foreign property market.



Q: I heard you have a new book titled: "No B.S. Guide to Property Investment – Dirty Truths and Profitable Secrets to Building Wealth through Properties". Could you tell us more about this book and what readers can expect from the book? 

I am sharing with the readers an unbiased view of all the truths I know in the property industry; the lessons I learned after making my first bucket of gold investing in properties; and the stories I heard from property buyers, sellers, landlords, tenants, agents, lawyers and bankers in my 12 years’ of property investment – all in 371 pages, 10 chapters, 101 articles and 50 real-life stories.


Q: Lastly, what's your view on the current situation of the property market? Is it a good time to invest? If not, when would be a better time to invest?

We have reached a turning point since 2013, though the media only starts to report it since 2014. It is not advisable to buy when the market is on its way down. As you can see in the history of property prices, patience will always be rewarded. Property has a cycle. Catch it only when it is low.


More about the new book

I've received a complimentary copy of the new book just recently from the author herself and have read the first few pages of it. The book is filled with real life experiences and honest sharing of strategies in property investment and provides readers a complete guide to it. This book is set to be available for sale at major bookstores in Singapore towards the end of this week.

Alternatively, you can order the book online and have it delivered to your door steps here: http://www.propertyclubsg.com/resources/

Here's the link to watch the book trailer: http://www.youtube.com/watch?v=It2J1lR-aWk

You can also access a free preview of the book here.

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Related Posts:
1. The affordability of housing in Singapore and the various housing grants available
2. How much money do you need to own a condominium in Singapore?