How To Create Your Own Financial Plan Before You Start Investing?

You can lose money from investing. This is a fact which many seasoned investors may have forgotten while other newbie investors are afraid of. New investors are afraid of venturing into the stock market due to the many horror stories they have heard from other people. Others have burnt their fingers and it affected their confidence so much that they would not dare to invest again.

Why is it that some investors can make money while others lose money?

The differentiating factor of a good investor vs a poor investor lies in a financial plan. A good investor knows what he is doing and is aware of the risks involved. A poor investor mostly follow tips and is not aware of what is actually happening apart from the stock prices going up and down.

A good investor can buy a stock and see a decline of 30% but still make money in his overall portfolio. A poor investor who follows exactly what the good investor buys can still lose money even though the good investor makes tons of money later. Are you the good investor or the poor investor?


Before you start investing

The financial plan should come in way before you start investing. This is not about planning your life to the extent that it becomes boring and mundane but is more about making the financial plan as automatic as possible so you could live your life normally without your finances being in a mess. You don't have to track your expenses everyday for those who don't like it. The financial plan can be reviewed as little as once a year or 2 times a year.

Credit: commons.wikimedia.org

Let's move on to the four steps of a financial plan:

1. Know how much money you want by what age.

To be rich, you got to want to be rich. I've listened to a lot of motivational speakers talk about visualising your dream and so on and I have to tell you this concept really works. What do you see of yourself in 5, 10, 15 or even 30 years from now? Of course you don't have to just focus on money alone as life is not just about money. It works the same for your relationships. Do you visualise yourself to have a happy family? There are so many other things in life. Money is a part of it. Visualise yourself having 100K before the age of 30? Set it as a target and it will happen.

2. Allocate your income into different parts of your life

This is the main part of the financial plan. It may seem like a daunting task in the beginning but trust me, it gets easier over time once everything is in place. The first step is to work backwards and know much much you need to save a month to achieve your goals you set in point 1. If you want to achieve 100k in 5 years time, you need to save 20k a year which is $1666.66 a month. This gives you an idea of how you are going to achieve that goal.

Now, many of you may start to think saving 20k a year is impossible. This impossibility is actually the first step to financial success. Once you have this mindset, turn it around and ask yourself how you can achieve that 20k a year? You'll be surprised that with just a simple change of mindset, you'll start to have ideas coming in to help you achieve that goal. That is how our brain works.

Balance your life between spending and saving. Allocate some money for networking, improving yourself through books, courses, travelling, investing etc. You may have read about an article where Li Ka Shing, a successful entrepreneur in Hong Kong, talks about allocating your money into 5 separate set of funds.

First for living expenses, second for making friends, third for learning, fourth for overseas holiday and fifth for investment. This may be something to consider. Allocating your income into different funds don't have to be done manually every month. I've written an article previously to explain how you can do it automatically here.

3. Protect yourself

Protection comes before investing. It is the base of a financial plan. You've probably heard about the need for an emergency fund. This is the money you set aside for emergency use such as if you lose your job or for sudden medical expenses etc. Some people say 6 months of your income is enough, Other say you need at least 1 year. No right or wrong here. You have to decide.

The next part is insurance. Cover yourself in the event of death, critical illness and also be covered for hospitalisation expenses as this can come up to quite a big sum of money. Some may add in disability income insurance which provides income for you in the event you become disabled and cannot continue working. Some may also add in personal accident insurance.

Insurance is important but don't allocate too much of your money for insurance that you have problems paying the premiums later on. For me personally, separating insurance from investing or savings and it'll be fine.

4. Practice asset allocation in your investments

Now, back to the story of the good investor and the poor investor. A poor investor loses money from investing because he doesn't understand how to create a financial plan. He sees other people make money from the stock market and jumps right into it. A good investor will buy stock A using 5% of his money while a poor investor may use 50% of his money to buy the same stock A.

When stock A drops, the good investor may continue buying stock A at a lower price using an additional 5% of his money. A poor investor may also continue to buy stock A using the rest of the 50% of his money at the same time. When stock A goes bankrupt, the poor investor loses all his money while the good investor loses only 10% of his money. The good investor still makes money from the rest of his other investments which may even cover the 10% loss. In the end, the good investor still makes money from his investments.

One of the distinct factors between success and failure lies in the understanding of risk in investments. We may say that the poor investor above will make a lot of money if stock A really goes up since he put 100% of his money in the investment. But, we have to always remember that the risk of losing all is always there. The poor investor may get lucky one time, two times or even 3 times but just one mistake and he could go back to ground zero. The poor doesn't understand risk and thus do not practice risk management.

Some investors will go further in asset allocation and not just invest their money into stocks. They could invest in different asset classes such as commodities, index fund ETFs, bonds, currency, real estate etc. Also, having an opportunity fund to take advantage of lower prices and invest during crisis is also a smart move. Learn how to allocate your assets like how the good investor always does.


Creating your own financial plan will differentiate you from majority of people out there. Investing should never be the first priority in your life. Get your life in order by using a financial plan, before you start investing.

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Weekend Video: Learning by Doing and Not Teaching

Recently I wrote an article on self discovery vs spoon feeding:  The Secret to Success: Self Discovery vs Spoon Feeding. Coincidentally, today I came across a video which shows exactly what self discovery is all about.

Here's the short video:

If you have kids, guide them on the path of self discovery. Let them learn by doing and not teaching. Have a great weekend. 

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1. Weekend Video: Having a Life of Gratitude

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The Secret to Success: Self Discovery vs Spoon Feeding

Spoon feeding destroys independent learning. Students who are spoon fed by their teachers may do well in their exams but the learning process is disrupted. I remembered when I was younger, I had some assessment books which my parents bought, which was supposed to be done for revision to help me understand the subject better. As I did not really like studying and was more lazy than hard-working, I often give up doing the Maths questions halfway and peeped at the answers at the back of the assessment book. Knowing the answers first without doing the questions did not help me improve my understanding of that particular question. It was just spoon feeding on my part.

On the other hand, if a student had attempted the question first then check the answers at the back, he or she would have understood the question more than I did. If the answer was wrong, he or she would know where the mistake was and could do it again to get the right answer. This is part of a self discovery learning process. I was intrigue by the idea of self discovery vs spoon feeding while exchanging emails recently. It was brought to my attention that there was this investor's club in Hong Kong where independent investors including kids start their own funds and shared their trading and investing experiences. Basically, these parents give their kids an amount of money to manage and then evaluate their performance. The parents wanted their kids to understand about business and trading at a young age. Through this club, they learnt not only how to invest properly but were also corrected of their mistakes if needed. It was a mentor-ship program through self discovery.

Self discovery should start at a young age, not spoon feeding. Our society is so used to setting rules and regulations that we become ignorant of what is going on around us. When situation turns bad, we don't know how to react as we're conditioned to live in a certain way. This is the result of spoon feeding. Parents always tell their kids what to do and what not to do. Although some boundaries should be set, there should also be room for some trial and error. It is part of self discovery.

Money is an important aspect of our lives.Spending money is part and parcel of life. Saving money is also part and parcel of life. However, most of us do not discover how to manage money until when we're much older. When we're young, we receive some allowance from our parents and most of the time, we spend it all. When kids have not enough money or want to buy something they like, they pester their parents to buy for them. They want to be spoon fed. If spoon feeding is done too often, it creates impatience in a child which may set him or her for failure.


Preparing kids for success

Now, what happens when parents do not spoon feed their kids but lead them on a journey through self discovery? Let's say parents give their kids a sum of money at the beginning of the month and let them spend on whatever they want. The rule is once the money is gone, they cannot ask for more until the next month. Then, they are also told that if they do not finish spending the money but save it and invest it with their parents, they will get some extra money later on. The simple idea that kids could get extra money later on will make them think twice when spending.

Think about it. When was the time when you found it easy to save money? Thinking back, you would have realised that it was when you thought about a car or a house that you wanted to buy in the future which makes you save the money. Research has shown that a better imagination of the future will make it easier to save money.

Once a kid starts saving money, teach them the value of investing. Invest some of their money in stocks and tell them why you did that and how dividends are received from the stocks. If you've invested their money in CapitaMall, you'll be surprised that later on they will ask you to buy more of CapitaMall instead of a toy that they want. Kids get to slowly discover the benefits of delayed gratification in this way.


The Road to Failure - Spoon Feeding

Success is not about making a lot of money. Even if you have a five figure monthly income, it does not mean you are successful. You can have a Million dollars today and lose it the next day. It happens all the time. Many people focus on earning a high income to have a better life. Once they achieve a high income, they go on to live more luxurious lives. But, have they thought about what happens when they lose their income? Will they still be able to maintain their lifestyle of paying high monthly loans for their properties and cars? Will they be forced to sell their house and cars at a lower price when crisis hits? This is where a lot of people get lost and don't know what to do.

We are often spoon fed by the media that we need this car and this house to be happy. We'll always see happy families on advertisement for condominiums and cars. We're made to believe that all these equals to happiness. However, this is certainly not true. Happiness is a choice. We can choose to be hapy regardless of the situation we're in.


Self discovery to Success

To be truly successful, take the route of self discovery. In the dictionary, self discovery is defined as "The act or process of achieving understanding or knowledge of oneself." 

In investing, we need to self discover to be successful. It is the same with business or even your job.

If you're an investor, you could ask yourself: "What is my purpose of investing in this company?"

If you're a businessman, you could ask yourself: "Why did I want to start this business?"

If you're working in a company, you could ask yourself: "Why do I choose to work in this job?"

By asking yourself these questions, you have a better understanding of why you are doing something. When things go wrong, you will know whether to stay or to move on. When the market crashes, you will know whether to sell or buy more of that company. If you invest base on tips or start a business just because you want to make money, then when things go south, you will be completely lost. Having an opinion of why you are doing what you are doing will make your path to success clearer. 

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Related Posts:
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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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Changes to the CPF - CPF Focus Group Discussion

Few months ago during the national day rally speech by the Prime Minister, it was announced that there may be possible changes to the CPF scheme to allow for more flexibility. A CPF advisory panel was appointed by the Ministry of Manpower in September 2014 to study possible enhancements to some key aspects of the CPF system, to make it more flexible to meet the needs of more Singaporeans and provide additional options in retirement.

I was at the first CPF focus group discussion last Saturday. I got to meet and interact with a few other people and know what were the concerns they had with regards to the CPF system. CPF was not a topic of interest to me until somewhere this year when I started to hear a lot of negative things about it. I had no idea what is the Minimum Sum or what it means. What I only know was that a portion of my salary is deducted every month into the CPF.

Because of the negativity spreading around, I decided to look deeper into what was going on. Writing a financial blog at that time also spur me to produce an article on the CPF system which I wrote here: All about CPF minimum sum and CPF life. My conclusion is, CPF is a social safety net that is for our basic retirement needs. Without it, our society may be in chaos with people having no money for even the basic necessities such as food during retirement.

But, as with every system, there will always be more improvements to be made. Many feedbacks were given and I personally heard from readers who emailed me as well as friends, family and colleagues who discussed about the CPF. As a young person living in Singapore, I see some of my older colleagues regret that they did not plan for retirement earlier in their lives. They had to continue working even when they don't like it. They do not have a choice to do what they like in life rather than just working in something they don't like.

During the focus group discussion, we formed into groups of 6. My group had only 5 person with 2 of the advisory panel members sitting in to listen. We could interact and discuss relatively well with the small group.

The 3 questions that we discussed were:

1. “How much of your retirement expenses should be covered by payouts from your CPF savings? And how much will you need to cover your basic expenses?”
2. “How much should be allowed to be withdrawn at a lump sum at 65, bearing in mind that withdrawing this amount will lead to lower CPF payouts?”
3. “If there was a CPF LIFE plan that had lower payouts at the start, but increased every year to help with increases in the cost of living, would you opt for it?”

I shall not elaborate further on what the general answers were during the discussion as you can probably read from news report by the media. They did quite a good job capturing what was being discussed during the focus group discussion.

For myself, here are my personal views to the 3 questions:

1. “How much of your retirement expenses should be covered by payouts from your CPF savings? And how much will you need to cover your basic expenses?”

I would like CPF to cover all of my basic necessities such as food, utilities bills, transport etc. In today's dollar value, a figure of $1000/mth would be quite comfortable. This is just for basic expenses


2. “How much should be allowed to be withdrawn at a lump sum at 65, bearing in mind that withdrawing this amount will lead to lower CPF payouts?”

Withdrawing a lump sum at age 65 is not needed if we have adequate money for retirement. I would choose not to withdraw any lump sum unless I really have no savings left. The money in the CPF still earns a 4% risk free interest in the retirement account. Moreover, having $155,000 inside the CPF at age 55 would give us an estimated $1200/mth for the rest of our lives starting from age 65. At 4% interest rates, the $155,000 in your RA account would grow to an estimate of $229,437 when you reach age 65 (assuming there are no further contributions). If we calculate, this would mean a 6.27% annual draw down rate (($14,400 divided by $229,437)*100%). This is not a bad draw down rate at all considering you get payouts for the rest of your life under the CPF life scheme.


3. “If there was a CPF LIFE plan that had lower payouts at the start, but increased every year to help with increases in the cost of living, would you opt for it?”

This question is tricky. I think starting to draw down at age 65 is already late and if we still get lower payouts at the start, then the amount becomes very little. With a fixed payout, there would be a worry of not having enough in later parts of our lives but I guess who still cares about increase cost of living when they are in their 70s?


I don't really like the idea of only drawing down our CPF at age 65. Since there're considerations to make the CPF more flexible, perhaps there could be an option to draw down earlier but of course with lesser payouts. An example would be to draw down maybe $900-$1000/mth at age 60 instead of $1200/mth at age 65. This is just my suggestion.

I did ask around and I always hear that draw down age at 65 is too late. Perhaps age 60 would be a good age to starting drawing down their CPF. A concern was that those who are above 60 risk losing their jobs more than anyone else.

There will be more focus group discussions organised for the next few months. If you are interested to participate for the subsequent focus group discussions, please refer to this website for more information: www.cpfpanel.sg. You can sign up for the discussions through the website directly. Information on the next available sessions are also listed on the website itself.

You can also send in your views and feedback on the CPF by emailing to cpf_panel@mom.gov.sg

I did talk to some of the advisory panel members and they were sincere in listening to feedbacks so they can make better informed decisions. We can all do our small little part to give our ideas and suggestions.

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Planning ahead [Guest Post]

This is a short guest post by Young. He has written a few other posts for my blog previously.  

Recently, there was an article in the papers regarding how young Singaporeans were frivolously spending on designer handbags. Read the article here.

It appears that many netizens were quick to condemn and I can definitely understand why given their estimated monthly pay mentioned in the article. (SGYI: The salary was just a mid four figure salary)

Who’s right? Who’s wrong? Is there even a right or wrong in the first place? I think not. There is no right or wrong. Some of the individuals quoted in the article state that they don’t feel pain spending the money and neither do they save up to fund these purchases.

Should we criticize these people? I think everyone has their own opinions but at the end of the day; the bottom line is that so long as one is able to justify his or her actions, it is entirely prerogative to do what they wish to.

Of course, one can never go wrong with saving what they can and I definitely stand by that going forward. Maybe youths aren't interested in learning to invest; but the act of saving itself, is definitely commendable at least to me.

I hope you enjoyed reading my brief post and have a great weekend!

In Summary, I feel that at the end of the day, one should know better what is best for oneself. Do not be overly tempted by decadent, opulent or frivolous lifestyles. Money out will always be easier than money in.

My thoughts: 

Many young people now grow up in more well to do families. Recently I have a friend who got a brand new BMW from his father. He knows his family is rich so he also spends most of his own money and don't find the need to plan ahead or save up for his future. Many of us may envy people who are born in rich families or envy people who get to live luxuriously but life gets boring without challenges. 

We don't have to envy the lives of others. The value of money is lost when we spend recklessly. One day we'll wake up and realise how ridiculous are the items we bought when we finally realise the need to plan ahead. 

How Not To Be a Cheapskate In Your Journey To Financial Freedom

In my journey to financial freedom for the past one year since I started this blog, many other people have joined in to start their own journey too. Some are younger than me, some are the same age as me while some are older than me. What is common is that we're all on the same path to financial freedom.

I have posted more than 230 articles on this blog on a wide range of topics from personal finance to investments to success stories and even life lessons. In this journey, often we'll ask ourselves how to balance between saving money and spending money. Swinging to either extremities may not be healthy for our lives in the long run. Imagine because young people want to save money and they have to abandon their social lives of hanging out with friends at shopping centres? Or worse still when you go dating, you get labelled as a cheapskate. I'm sure we do not want this kind of life.

Living a cheapskate life is never good. However, thinking that frugality is synonymous with cheapskate is also wrong. They are 2 completely different lifestyle. When we're older and free from the dating world or the need to belong to a certain younger generation of society, then being cheap works perfectly fine for you. But the problem is for young people. Being young means having the desire to be part of a society, to feel belong to a group of people and having some social status. I've been young and am still young by society standards. Telling young people to be separated from society and become some unusual weirdo is never good.

Credit: https://www.flickr.com/photos/51764518@N02/9759057675/

Nowadays, you mostly don't see a group of young students hanging out at hawker centres or coffee shops. Where are most of them? They are either in nicely decorated Cafes, fast food joints like MacDonald or at the cinema watching movies. This is the lifestyle and if you're a young person right now, you probably have to or is doing that to be part of your group. Also, you mostly see young students with trendy and nice clothes during the weekends. Now the question is, will they still be able to save money with this kind of lifestyle?

I was chatting with a friend on this cheapskate issue which revolves around the furniture that we buy. There was an issue that a certain brand of furniture was thought to be valued for money just because it is cheap. However, the problem is most people who buy that brand of furniture realises that it is not durable and falls apart easily. What attracted consumers to buy is the design and what appears to be good quality material but underneath it hides the cheapskate materials that easily dents. But however, buying cheapskate stuffs does not save you money at all. The plan is to make you buy again and again. This is consumerism which I've discussed on in a previous article here.

Buying good quality stuffs saves cost in the long run. It saves the environment too by minimising wastage. A cheapskate person buys stuffs which is cheap and thought to be value for money. A frugal person buys stuffs which is of good quality and yet spends less to own it. This is the distinct difference between cheapskate and frugality.

So How Not to be a Cheapskate and still be able to achieve financial freedom? Here are some ways:

1) Know that being Frugal is not equal to being Cheap. Frugal doesn't mean you own all the crappy stuffs.

Being labelled as a cheapskate is never a good thing. Thinking that frugality is equal to cheapskate will destroy your life. Frugality is a trait while cheapskate is a social disorder. If you save money by taking advantage of others such as not paying for bills, waiting for someone to treat you for a meal, then its cheapskate.

Here's a funny video to illustrate what it means to be cheapskate:

*Warning: Don't do what the video shows if not you'll become a cheapskate

The video is funny. I had a few good laughs on some of their ideas. A frugal person does not take advantage of others. Only a cheapskate does. Frugality is not about owning all the cheap and crappy stuffs. For example, a frugal person can own a branded $100+ pair of shoe and know that it can last for many years vs buying a cheap $20 shoe which can only last for 1 year.  

2) Live like a Spartan when nobody's around

We need to socialise to make friends and build network. These are the times we hang out at Cafes and have meals at restaurants. When you're out dating, it's appropriate to pick up the bill and give a treat to your girlfriend. Even when you're out with friends, paying for the drinks goes a long way for the friendship that you have. It doesn't hurt to pay that little money which strengthens relationships. 

However, when you're alone and nobody's around, you can start living your simple life again. Buying simple groceries and cooking at home is great. Relaxing with an interesting book instead of an iPad seems like a good idea. Nobody will see you as a cheapskate when you're alone. 

3) Get more for less

Believe it or not, it is impossible not to spend any money. You got to spend money for that formal shirt, pants or skirts for your first job interview to look presentable. You got to spend on socialising to build up your network especially during the early days of your life. For young people, you got to date to get a girlfriend. That cost money too. Some of us might want to go on an overseas trip at least once a year to take a break from work. Yes, that is important too to let you recharge from working the whole year.

Since we have to spend money, we might as well spend it smartly. There are discounts all over the city. With the internet, it is even easier to compare products and get the latest discounts. I can buy that same piece of shirt that usually cost $80 for $30. I can get the same plane ticket that usually cost $500 for $200. I can watch the same movie at the same cinema for $9 instead of $12. All these discounts happen all the time. We can get the same product but at a lesser price.

Let me give you a specific example. For plane tickets, it gets easier to travel with budget airlines such as Jet Star, Scoot and Air Asia. But do you know these budget airlines still offer discounts even though their tickets are already cheap? Discounts happen almost every week with special discounts once a month or every few months. Sign up for their newsletter and if you just wait for a few more days before you book your tickets, you might get that $200 plane ticket instead of the $500 ticket.

Let your financial journey not be a cheapskate but a meaningful one.

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