Tuesday, November 14, 2017

Where To Put Your Money To Save For Better Returns?

Interest rates are so low in our bank accounts that it virtually earns close to zero interest. Gone are the days where we see higher interest in the bank account where it was once as high as  9.5% as offered by POSB in the 1980s. Now, there are other higher interest/savings account which offers 1%-3% interest but there are various criteria to meet such as paying bills, buying investment products and meeting the minimum credit card spend.

During my school days, someone approached me to do a survey and subsequently told me of a higher interest product which is known as an endowment plan. Being young that time, I was convinced that this was the better option than just putting my money in the bank account. Little did I know after 10 years, the plan is not even halfway through as it takes 25 years to mature.

I'm sure many of us have bought into similar plans in one way or another and still paying for it after many years. It seems like it’s never ending.

Saving for life goals. The Shorter Way.

While there are many savings plan out there which many people put their money in to achieve certain savings goals and at the same time compound it, 25-year term for most endowment plans is too long for short term goals such as marriage, buying a house or even saving for a child's education.

There are other guaranteed returns investment tools such as the Singapore Savings Bonds (SSB) which are capital guaranteed and pay out a fixed rate coupon to us. However, it can be hard to plan for our savings with this as we need to buy and sell the bonds and there will always be the desire to sell it for a profit. Nevertheless, it is a safe and guaranteed low risk investment option.

Apart from the SSB, I recently found out a new savings plan by the Maybank Group's Etiqa Insurance which provides relative short term plans with guaranteed interest rates. The shortest term is 6 years with 2.02% p.a. guaranteed return. They also have longer term plans which offer higher interest. The good thing about it is that it is capital guaranteed so no matter what, you will get your initial savings back and will not lose a single cent. At this point, maybe some of you may have questions on how does it work, is it risky and does it seem too good to be true? I went on to probe further and got more information as much as possible.

Before we go deeper into the details, let's take a look at the 2 plans which are offered:

eEasy Save - Guaranteed 2.02% pa for 6 years

This is the simplest of all plans which pays out guaranteed 112% upon maturity after 6 years. We only need to pay for the premiums for 2 years though. There is also death protection of 105% of total premium paid throughout policy term and additional accidental death protection at 100% of premiums paid throughout premium term.

There are other similar plans such as the one from FWD insurance which also gives 2.02% p.a. Even though the term is shorter at 3 years, it is important to note that FWD’s credit rating is BAA3 which is lower than Etiqa’s A- rating.

eEasy Savepro - Capital guaranteed and up to 4.02% pa

This seems like an enhanced version of the eEASY save with higher interest for those who want to grow their money further. To get 4.02% p,a,, we will have to go for the 15-year plan. The capital is still guaranteed for eEASY savepro plan so we are assured that we will not lose our money. The lowest is still the 6-year plan which gives 2.65% p.a., slightly higher than the eEASY save although interest is projected. The same death protection and additional accidental death protection apply.

For a summary and more details of the plans, you can refer to their websit.

Who is Etiqa?

Before putting our money into any place, it is important that we know more about the company. Some of us may know Etiqa when we buy our fire insurance for our HDB flats. They are the (only) HDB-approved Fire Insurer and have been protecting more than 300,000 homes since 2009. They also have competitive travel insurance which some of you may have bought before. Their travel insurance even has automatic flight delay notification which will send us a sms text if our flight is delayed and once we qualify for a claim, it will also be automatically be processed without the hassle of making the claims ourselves. Etiqa is 69% owned by Maybank and AGEAS, a multinational insurance company, and is regulated by MAS.

In view of the above, Etiqa is credible and is a safe place to put our money. Let's take a look at some of the life goals we can save up for.

 Life Goal 1 - Saving for Wedding

Getting married requires some savings to begin with. Maybe you're in your 20s and thinking of getting married in the near future. A 6-year savings plan can come in handy with guaranteed return and guaranteed capital. Maybe we can look at eEASY save’s $45,000, 6 year plan which will pay out a guaranteed $50,404 at maturity.

Here's the benefit illustration which I managed to get from Etiqa:

It's that simple, just pay the premiums for 2 years and get 2.02% p.a. guaranteed return on your money in 6 years’ time. The premiums will be $30,000 for first year and $15,000 (half of first year premium) for second year. It may be quite hard though if you do not have that much savings in the first place. If you have some savings already, it will be good to park it somewhere to use for your marriage later. At the same time, you can earn some guaranteed interest on your money.

Some may say the returns are quite low which I agree to a certain extent. However, I will think it is good to save our money which is critical for future use. This will be a good financial planning consideration where our money is assured to be safe and is not left in the bank earning close to no interest. A normal savings account only earn us about 0.05% interest which is exceptionally low.

Life Goal 2 - Saving For Child's Education

Another important life goal is saving for your child's education. Some of us may have bought endowment plans for this purpose as well. However, we will realise by now that endowment plans are not capital guaranteed and the investment returns are not high too.

Many times, we will be locking our money for 25 years and getting only about 3% projected returns. I've checked Etiqa's eEASY savepro 15-year plan, which we can get 4.02% p.a.. The investment return is projected only but your capital will be guaranteed.

Looking at the $50,000 plan, here's the benefit illustration:

This can be slightly complicated so let me summarise. For the plan, we will pay $5,000 every year for 10 years. The plan will mature at the end of 15 years. The maturity yield is listed on their website as 4.02% p.a. which is a projected value. The maturity value is the amount we see under the "projected at 4.75% investment return", S$76,091. 4.75% investment return here refers to the investment return on the participating fund while 4.02% p.a. is the projected return to the customer.  The maturity value is also calculated using compound interest of the projected 4.02% p.a. interest.

They have other plans with policy terms of 6, 7, 9, 11, 13 and 15 years and premium sizes of $5,000, $10,000, $30,000, $50,000, $80,000 and $100,000. It is quite flexible to plan for our life goals with some certainty that we will not lose our money.

How are returns generated?

By now, some of us may be concerned of whether the plans can deliver its projected returns. This applies for the eEASY savepro plan. I managed to get some information on Etiqa’s overall participating fund's asset mix where 65.6% is invested in bonds, 21.4% in equities, 11.3% in cash & deposits and 1.7% in loans and others. While eEASY savepro is part of this participating fund, this asset mix is not representative of eEASY savepro’s specific portfolio as premiums paid are pooled with those of other participating policies offered by Etiqa.

The top 5 equity holdings is in OCBC (12%), DBS (10.6%), UOB (10.1%), Singtel (5.8%) and Keppel Corporation (4%). For bonds, the top few are the Singapore Government bond, Australia & New Zealand bank bonds and also Dai-ichi Life. In 2016, the fund generated a return of 3.97%.  

Guaranteed savings for life goals

I am still a firm believer in investing my own money but at the same time a portion of it should also be in a safe place for any future goals. Better returns with capital protection is a safe way to save for our life goals. We do not want to end up losing money and jeopardising our future and the future of the people around us.

Currently, for eEASY savepro, they are giving out vouchers based on 1.5%  of the 1st year premium size, and up to $1,500 worth of Takashimaya vouchers. While, for eEASY save, the deal involves up to $1,300 worth of Takashimaya vouchers which will increase the interest rate to 2.18% p.a. from 2.02% p.a. instantly.. Each of these deals are limited to 5 coupons per day. Just head over to their website to grab the coupons.

If you like to take a closer look at the plans above, you can refer to their website . The good thing is you can do everything online and get immediate approval so it saves the time and hassle of meeting an agent and possibly overbuying on plans which you do not really need.

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This article is written in collaboration with Etiqa Insurance. All ideas portrayed are independent by SG Young Investment. 

Wednesday, November 8, 2017

A New High Interest Savings Account To Multiply Your Money – The New DBS Multiplier Account

I've been constantly sourcing for a high interest savings account to park my savings as I always believe in making my money work harder for me. Many of my friends have done it too and transferred their savings to OCBC 360, UOB One, Standard Chartered or even CIMB. I opened a few accounts too just to ensure my savings earn a higher interest.

Where did I transfer my savings from? The answer is POSB/DBS. I have been using a POSB/DBS savings account for a very long time since I was a child. As they have the most ATM machines in Singapore, most people have a POSB/DBS account as their basic savings account. And for the longest time, I've been trying to find out if POSB/DBS has a high interest savings account so that I could consolidate all my money in one bank.

Finally, the time has come!

They have joined the competition to provide a high interest account in the market right now with the revamp of the DBS Multiplier account. This is definitely a game-changer! It is attractive, flexible, easy to use and most important of all, many of us would already have a DBS/POSB savings account which makes it easier to integrate.

The much awaited higher interest account - New DBS Multiplier Account (up to 3.5% pa)

Removing the pain points to get higher interest

The new DBS multiplier account is quite different from the other banks as they have removed most of the pain points to getting higher interest. This is also different from their previous multiplier account which is not that attractive.

Most of us would know that you need a minimum salary credit of at least $2000, pay 3 different bills, meet a minimum credit card spend just to get higher interest from banks such as OCBC, UOB etc. Now, all these will change with the new DBS multiplier account.

DBS allows you to earn higher interest with NO minimum salary credit, NO requirement to pay any bills and NO minimum credit card spend. The minimum interest you can get is 1.55% p.a. just by fulfilling 2 simple requirements with total eligible transactions at $2000 or more per month. You can get up to 3.50% p.a. too by fulfilling more conditions.

Let's see how it works:

1) Basic Requirement - Salary Credit

The first thing you need to do is to have your salary credited into any DBS or POSB savings account. This means if you already have your salary credited to your existing DBS/POSB savings account, you don't have to make additional changes to it.

Remember there is no minimum salary credit to enjoy higher interest.

2) Salary Credit + Additional 1 Other Requirement - Enjoy min 1.55% p.a. and up to 2.08% p.a.

Once you have your salary credited to any DBS or POSB savings account, you just have to meet any one of the following additional requirement:

  • Credit card spend
  • Investments
  • Insurance
  • Housing loan

As long as your salary credit and 1 other requirement meets a minimum of $2000, you will enjoy higher bonus interest on the first $50,000 balance.

  • For credit card spend, it is applicable to any DBS/POSB credit cards (not applicable to debit cards).
  • For investments, it is applicable to unit trusts (including POSB invest saver), online equity trades etc.
  • For insurance, it is applicable to any purchase of insurance with DBS/POSB.
  • For housing loan, it is applicable to any monthly instalment payment for housing loan with DBS/POSB.

*For insurance and investments (unit trusts lump sum/RSP/invest saver only), it is only applicable to new purchase after opening of DBS multiplier account

These are the different tiers for you to enjoy higher interest for salary credit + additional 1 other requirement:

For example, if you have a salary credit of S$2400 with any DBS/POSB savings account and you have some spending on your DBS/POSB credit card, you'll be eligible for the 1.55% p.a. interest. Even a $1 credit card spend will allow you to earn that higher interest.

If you have a higher salary credit plus credit card spend adding up to S$2,500 and above, you will get even higher interest at 1.85% p.a.

3) Salary Credit + Additional 2 Other Requirements - Enjoy min 1.80% p.a. and up to 3.50% p.a.

If you have salary credit + additional any 2 other requirements (as above), this will be the different tiers for you to earn higher interest:
For example, if you have a salary credit on any POSB/DBS savings account and some spending on any DBS/POSB credit cards plus you have either monthly investments on POSB invest saver or monthly home loan instalments with DBS/POSB, you will get at least 1.80% p.a. For this segment, I believe if we have a salary credit + additional 2 other requirements, we can easily get more than 2% p.a. Not too difficult to have a total transactions above S$2,500 for this.

How Much Interest Can You Typically Earn?

I think this new multiplier account from DBS really makes it easier to earn higher interest. Its easier and more flexible than the other existing products out there in the market. Let's do some scenarios and see how much interest can one typically earn?

Scenario 1 - Fresh Graduate with $2000 salary credit + credit card spend

Most fresh graduates are likely to have at least a $2,000 salary credited into their bank. Some might even earn more. For an additional 1 other requirement, the easiest will be the credit card spend. As the new DBS multiplier account doesn't require any minimum salary credit or spending, once you have $2,000 salary credited, you've already fulfilled the minimum criteria.

For the credit card spend, there is no pressure to spend a minimum just to meet the criteria to get a higher interest. Let's just assume that the spending is just $100 and total eligible transactions will be $2,100 which enables one to earn an interest of 1.55% p.a. For a savings of $10,000, total interest earned will be S$153.30 annually.

If this fresh graduate spends more and chalks up $500 in credit card spending per month, total eligible transactions will be $2500, which enables one to earn an interest of 1.85% p.a. For the same savings of $10,000, the interest earned will be S$182.50 annually.

*Note: Most credit cards application require annual gross income of $30,000. If you still hold a student credit card, it is eligible for higher interest criteria as well. 

Scenario 2 - Young Working Adult with $4900 salary credit + credit card spend

For a young working adult, he would have rose up the corporate ladder and gotten a higher salary by now. Assuming he has a salary credit with DBS of $4900 and $500 credit card spend, total eligible transactions will be $5400,  which translates to an interest of 1.90% p.a. For savings of $30,000, the interest earned will be S$569.40 annually.

Scenario 3 - Fresh Graduate with $2500 salary credit + credit card spend + Investment

Now, if a fresh graduate also makes monthly investments with either DBS or POSB apart from salary credit and credit card spend, he or she will be able to get min 1.80% p.a. For investments, it includes any trading/purchase of stocks done on DBS vickers account or any monthly investments with POSB Invest Saver.

If this fresh graduate has a salary credit of $2500, a credit card spend of $200 and an investment of $100 with DBS/POSB, he or she will get 2.00% p.a. This is higher than most other bank accounts out there currently.

Comparing to other high interest bank accounts

Now, the most important thing is whether the new DBS multiplier account is the best in the market?

I've looked through the account and various interest rate tiers which they have and concluded that they offer the highest interest in the market currently. Just 2 criteria and you will get a minimum of 1.55% p.a.

Let's look at some scenarios to compare against what they would get from other bank accounts such as the OCBC 360, UOB one, BOC smart saver, SCB bonus saver and Maybank SaveUp account:

Scenario 1 - First Jobber with S$2,700 salary credit + $500 credit card spend

For scenario 1, the interest earned on DBS multiplier account is 1.85%. The only bank that match up to this rate is BOC. However, for BOC, the minimum salary credit is $2000 and minimum credit card spend is $500 which is quite restrictive. For DBS, there is no minimum salary credit or credit card spend. Only need to meet above $2000 to get higher interest.

It seems like even the more popular ones like OCBC and UOB does not match up.

Account balanceDBSOCBCUOBBOCSCBMaybank

Scenario 2 - Young working adult with S$4,900 salary credit + $550 credit card spend

For scenario 2, the interest earned on the DBS multiplier account is 1.90%. All the other banks fall behind with only SCB being the closest at 1.88%. 

Account balanceDBSOCBCUOBBOCSCBMaybank

Scenario 3 - Lower waged worker with S$1,800 salary credit + $200 credit card spend

For scenario 3, the other bank accounts clearly does not benefit anyone with less than $2000 salary credit but for DBS, they still give higher interest as long as you can meet a combined eligible transactions of S$2,000 per month. This is a life saver for those who could not qualify for higher interest from other banks due to their salary. 

Account balanceDBSOCBCUOBBOCSCBMaybank


The new DBS multiplier account clearly distinct itself among the competition of higher interest bank accounts. This will cater to new groups of people who prefer flexibility and avoid the trouble of having to meet minimum credit card spending or pay 3 bills etc.

This will also cater to those who have not been able to meet the minimum salary credit or the pay 3 bills or minimum credit card spending requirements from other banks. Its time to let this group of people earn higher interest too.

For existing POSB/DBS account holders, you just need to open a new multiplier account and put your savings into it to start earning higher interest. You do not have to change your salary crediting arrangements if your salary is already credited to any of your existing POSB/DBS account. It will automatically be detected subjected to T&Cs of eligible salary credit.

To find out more about the new DBS multiplier account click here.

This article is written in collaboration with DBS. All ideas portrayed are independent by SG Young Investment. 

Monday, October 30, 2017

Earnings Season - CMT and FCT Financial Results

Its earnings season again which means time for more dividends. I've owned Reits for a long time now where I can get stable and recurring income from these investments. Shopping mall Reits are attractive in Singapore and 2 of the most popular ones are Capitaland Mall Trust (CMT) and Frasers Centrepoint Trust (FCT).

CMT and FCT both reported their financial results just a few days ago and I must say shopping malls in Singapore are still quite resilient. The management of the malls is quite important as I personally saw a few malls become dead because of incompetent management. CMT and FCT are not the incompetent ones.

CMT financial results

For CMT, its 3Q financial results is nothing spectacular. DPU came in flat at only +0.3% year on year. The closure of Funan for redevelopment has affected its DPU as rental income decreased without Funan in its portfolio. Fo other malls, net property income remain largely unchanged.

Its NAV is currently at $1.95 and share price trading at $2.03. Its still a stable Reit to hold for the long term where I bought it back at $1.88-$1.90. I will still be holding this stock for its dividends. Dividend yield is about 5.5% base on current price.

FCT financial results

Frasers centrepoint trust is another resilient shopping mall reit which I have in my portfolio. It reported strong 4Q17 results where DPU rose 5.5% as compared to last FY quarter. Its portfolio occupancy rose to 92% from 89.4% and rental reversion was +8.3%. FCT has delivered 11 years of consecutive DPU growth. It is quite impressive to be so resilient and still has some steady growth.

Artist impression of the new Northpoint city.
Adapted from http://www.fraserscentrepoint.com.sg/mega-development-northpoint-city-set-welcome-shoppers-q4-mall-track-soft-opening-close-90-leased/

For its portfolio, the higher income came mainly from the following:

Causeway Point
This is the shopping mall at Woodlands. There were renewed and new leases signed which contributed to a 2.5% increase in rental rate.

Northpoint City
The shopping mall at Yishun has been going through AEI works for quite some time now. The enhancements are progressively completed so there is higher occupancy and rent from the new tenants. There is also additional revenue from Yishun 10 retail podium which was acquired on 16 November 2016. This improved the revenue by 27.4% year on year

Changi City Point
The shopping mall right beside Expo MRT is doing well too. Higher rental rate from renewed and new leases signed, and improved occupancy contributed to an increase of 13.6% in revenue.

The only lagging mall in FCT portfolio is Bedok point which saw a drop of 26.4% in revenue. However, it is only 2.8% of all of FCT's NPI so it isn't much of a concern. The largest contributor comes from causeway point at 50.6% of FCT's NPI. Causeway point occupancy rate is still impressive at 99.5%. Northpoint city will be the next major contributor as AEI works are progressively completed. Occupancy rate stands at 81.6% currently so there is lots of room to continue growing.

FCT has provided me dividend income of about 6% p.a. Dividend yield is about 5.4% at current prices. It is trading at a price to book ratio of 1.08x which is slightly above its net asset value. I wouldn't consider accumulating more at this point but will continue to hold this for dividend income.

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Wednesday, October 25, 2017

One Year After I Stop Tracking My Expenses Daily

Its been more than a year since I stopped tracking my expenses on a daily basis. When I first started out my financial journey, I wanted to find out how much I was spending on each specific item so that I can streamline it accordingly. However, after a few years doing that, it became quite pointless and it also restricted my life too much as when I spent a little more for any day, I would feel the pinch. So, I decided to gave it up and just keep track once a month instead.

I wanted to know how did I fare after I lessen my tight on my spending so I reviewed the numbers and plotted out some charts:

Unfortunately, I lost some of my expenses data in 2016 as I accidentally deleted the sheet in my excel file. Looking at the other months, there were some months which I over spend especially for this year. The green bars shows my basic monthly income from my full time job while the blue line shows my monthly expenses.

Instead of focusing on reducing expenses, I focused on increasing my income instead. Despite changing job in Jan this year, it wasn't really a big difference as the pay increase is just about 10%+. On the other hand, I manage to get side income through other means such as providing consultancy services, working with affiliates and sponsors on my blog and dividends from stocks investment. This is how the chart looks like with the total income:

The income bars become very irregular as the income from other sources are unpredictable, sometimes more while sometimes less. It is also because of the other sources of income that I can still have some substantial savings despite the increased expenses.

In fact, other sources of income this year so far has been able to cover all my expenses which means I could save 100% of my full time job income.

It took many years of hard work and opportunities seeking to get other sources of income which is a goal I embarked on many years back to create multiple sources of income after getting inspired by a book I read.

To create more income, one thing I learnt is that we must find something which we have the passion for. I have the passion for finance, investments and housing and property so I went into mortgage consultancy. After 2 years of doing it, I still feel passionate whenever I can advise someone on their affordability for a new property they are intending to buy or I can help someone save some money through refinancing their loans. It also helps that I do the consultancy service without relying on the income for survival. I can give advise without expecting to earn from it.

Blogging is also a passion. Writing on finance and investments is what I like to do. This blog has existed for 4 years plus now and I can't believe how I can still manage to write. To me, this is like a journal as well as a platform where I hope to reach out to more people on the importance of financial planning. This was the purpose which gave birth to this blog and it has been an amazing journey where I got to know some friends along the way and receive heartwarming emails from readers like yourself.

Hope this post is an inspiration on what you can do for your future too.

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Sunday, October 22, 2017

A New Cashback Card with Up-sized 3% Cashback

There seems to be competition among the banks in Singapore which is good for consumers as they start to give more interests and benefits to get more customers. Previously, many cashback cards were launched with no minimum spend and no other conditions. You get cashback for any spending.

Today, there's a new cashback card which gives up to 3% cashback. This is the NEW Standard Chartered Spree Credit Card. Again, to match the competition in the market, there is also no minimum spend to get cashback. Here are the details I managed to pull out from the bank:

  • No minimum spend and up to $60 cashback monthly
  • Earn 3% cashback on all online spends in foreign currency and all vPost spends
  • Earn 2% cashback on all online spends in local currency, all contactless and mobile payments
  • Earn 1% cashback on all other retail spends
  • Many other privileges for Singapore Post and vPost services
  • Annual fees waived for 2 years
  • Minimum annual income of $30,000 for Singapore Citizens and PR

This card seems to offer the highest cashback of 2% for all online spend and also all contactless and mobile payments. Its easy to find contactless payments now all around Singapore which shouldn't be hard to get the 2% cashback. Just use visa pay wave easily at many locations island wide. 

If you're interested, apply from now till 15 November to get $150 Grab Gift for use for your Grab car rides. This is for new SCB cardholders only and not eligible for any other promotions from the bank. Apply here today to get your $150 Grab Gift and get your cashback started!

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Thursday, October 19, 2017

Multiple Streams of Income Through The Gig Economy

This year, I've been seeing more news on the gig economy. Think of flexible working hours, doing what you love, be your own boss and freelancing. These are all part of the gig economy. In Singapore, about 9% of the workforce here are in the gig economy. That is still not a lot as compared to countries like the US having 30% of their workforce in the gig economy.

Interestingly, an article on the Straits Times said that "about 47 per cent of Institute of Technical Education, 35 per cent of polytechnic and 10 per cent of university graduates went into part-time, temporary or freelance jobs last year - more than double the share from a decade ago." More and more young people choose to have freedom in their work instead of going into full time work in the corporate world.

Do You Like Your Job?

More often than not, we hear people saying things like Monday blues, cant's wait for weekend to come, tired of working or I hate my boss. All these are signs that a majority of people don't really like their job but still have to work in order to survive. This is a stark contrast compared to those in the gig economy where a great majority enjoyed their work as freelancers.

I'm not suggesting that you quit your job right away and go straight into the gig economy as its still a risk to forego your stable monthly income. However, there are some ways the gig economy can benefit us to reach financial independence earlier so we do not have to work for the sake of working anymore. Does this sounds good to you?

How The Gig Economy Can Benefit Us?

The gig economy is getting larger and more connected now that it is easily accessible to most of us or in fact all of us. In Singapore, it is estimated that about 1.5% of the workforce are 'secondary' freelancers, meaning these workers freelance part-time alongside other jobs and would include students, housewives or retirees who take on side jobs for additional income.

When I was in town for work, I often see many students riding on their bicycle or e-scooters with a big bag. The names on these bags are familiar, Uber Eats, Deliveroo, Food panda are some of the most common ones I've seen. All these are young students earning some extra pocket money.

Then, there's Uber and Grab where many of them are doing it part time apart from their full time job. I heard drivers can easily earn a few thousand dollars extra just by driving part time. There are even more freelance jobs online. Just a search on Google and you can find any jobs which matches your skills and you can get paid doing it. Some of the categories can be seen below:

I also recently saw some advertisements on a crowd sourced tuition portal called Tueetor. There, you can be matched to any students who are looking for tuition that matches your skills. You can earn some extra money by teaching others. I've not tried it before but it does looks good. There are so many requests on the website which we can see from the map. Its like the Uber and Grab of Tuition.

Multiple Streams of Income Through The Gig Economy

I suppose the gig economy will continue to be more popular as people become more aware and savvy on how to take advantage of it to increase their income. This is like a dream come true for those who always wanted to build multiple sources of income.

I personally already have a few friends who are in the gig economy. They can potentially earn double of what the average person of their age are earning. However, as mentioned earlier, it can be risky to quit your job and go straight into the gig economy, though we can start on the sideline first and see how it turns out. If you can offer value, people will be willing to pay for your services.

We can also accelerate our goal towards financial independence through the gig economy. With higher income, it makes it easier to achieve our financial goals and one day we'll realise we have got out of the rat race. Rather than working in a job which we hate for the rest of our lives, we can make some plans to have more freedom and happiness in our life.

*If you're interested to create your own financial plan, do check out this article which I've written previously. Also, check out how you can retire in 7 years in this article

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Saturday, October 7, 2017

Money Hacks To Make The Best Out of Your Money - Part 2

Money Hacks is a 2 part series to share about the deals which I used to make the best out of my money. Read Part 1 here.

In Part 1, I shared on the high interest bank accounts, the cashback cards and also the dining discounts which I can get. In part 2, I will write about the deals for movies, shopping and also how to travel smartly.

Finding the best deals - Movies and Shopping

For movies, here are a list of discounts for 3 of the main cinemas in Singapore:

Golden Village Cinemas

HSBC's Movie Card - $7.50 weekday movie tickets, $9.50 weekend movie tickets

DBS GV iCard - $7.50 weekday movie tickets, $11 weekend movie tickets

Shaw Theatres

Safra Card: $7.50 weekday movie tickets, $10.50 weekend movie tickets and 1 for 1 weekend tickets (for first 500 redemptions per day only)

M1 Customers: 1 for 1 movie tickets on Sunday (valid for first 450 customers only)

Cathay Cineplex

Mastercard - $8 weekday movie tickets, $10.50 weekend movie tickets (not valid for online bookings)

Singtel Customers - 1 for 1 movie tickets every Thursdays (valid for first 500 customers only)



For shopping, a good website is Shopback to get cashback. You can get cashback on all the popular stores such as Taobao, Qoo10, ebay, AliExpress, Lazada, Shopee and many more. There are many other popular stores too which includes food panda, Expedia, Agoda etc

What's more, you can use my link to get $10 free when you sign up. Sign up here to get your free instant cashback.


Many of you should have heard of Carousell where you can buy and sell stuff. Its getting so popular that I'm hearing more and more people use it. Besides selling your stuff, many people actually buy things from there too. You can get some good stuff just searching around and most of the time its much cheaper than what you get in the retail shops.


Ezbuy is an online shopping portal which brings you the stuff from Taobao without you having to buy your stuff in RMB. There are quite a lot of stuff available for sale and its fairly easy to use. For delivery, you can choose either to deliver straight to your doorstep or choose a location near your house. This can save you quite a lot of delivery charges.

Travelling Smartly

For travelling, the 2 biggest expenses will be the air tickets and accommodation. Let's talk about air tickets first.

Air Tickets 

For comparison of the best air tickets, you can use skyscanner which will instantly compare for you the cheapest air tickets across many airlines. In just less than a minute, you can get the best deal for your flight tickets instantly.

However, air lines do not offer promotions all the time so its crucial to know when the promotions are offered. There are a few ways to keep up to date on the promotions. Firstly, you can follow the different airlines on their Facebook page and also subscribe to their newsletter. For Scoot, they seem to offer special rates on Tuesday and for Jetstar, its on Friday. Full fledge airlines such as Singapore airlines do offer promotions too and it can be quite attractive once they have it. Another website to follow is moneydigest.sg which always have the latest deals updated on their site.


For accommodation, there are more choices now as compared to the past. Besides staying in the traditional hotels, there is airbnb where you can stay at someone's else home. If you're going on a trip with your family, you can actually book the whole apartment with kitchen, living room, bedrooms all for yourself. I've stayed in a few before and its quite an unique and fuss free experience. Just remember to check the reviews to make sure its good before booking.

For hotels, we can use trivago.sg to compare for the best hotels. You might have used Agoda or booking.com before but now with Trivago, they instantly compare against many websites (including agoda and booking.com) for the best hotel deals. Its the best "skyscanner" for hotels.

Regardless if its getting higher interest on your bank account, cashback for spending, shopping, dining, watching movie or even travelling, there are money hacks which we can use to make the best out of it. With the power of technology and the rise of comparison portals and sites, it makes it easier to get the best deals now.

P.S: I've started a comparison portal on my blog too to allow you to compare for the best deals. Check it out here

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Friday, October 6, 2017

Money Hacks To Make The Best Out of Your Money - Part 1

Money comes and go like a running tap water. However, we can always make the best out of our money by using a few simple hacks which I've done over the past few years. I believe this has significantly added to my savings and at the same time I still continue to enjoy the finer things in life.

Some of the hacks I employ includes:

1) Enjoying higher bank account interest

2) Getting cashback on my spending

3) Finding the best deals (Dining, movies, shopping etc)

4) Travelling smartly

Let me share in detail what I do to make the best out of my money which you can too to make the best out of yours!

Enjoying higher bank account interest

Since 2005, I started putting my money into higher interest account because the banks in Singapore just slashed their interest rates like nobody's business. Since then, I've switched a few accounts here and there because interest rates in the accounts changes over the years too.

For now, my 2 main high interest accounts are from OCBC and CIMB. OCBC 360 is easy to use and we just need to meet 2 criteria to enjoy 1.5% interest rates on the first $70,000 in the bank account. I just need to credit my salary and also pay 3 different bills to get the 1.5% interest rate. This is easily an additional free $1050 for the year.

Above $70,000, I put into CIMB fast saver account to earn 1% interest on the first $50,000 and then CIMB star saver to earn 0.8% on any balance. The best is there is no conditions to meet for CIMB so its very straightforward. It is very easy to open too just need to do everything online without the trouble of going down to the bank.

Possible extra cash savings: $1000+ a year

Getting cashback on my spendings - Free $150 Grab Gift

I started using cards to get cashback on my spending when I heard a friend say how he had a debit card which gives 2% cashback on all spending. I went to apply for it and used it to pay for my university fees where I got hundreds of dollars in cashback as a result.

Nowadays, its hard to find a debit card which can give good cashback. One of the debit card which gives cashback is the DBS visa debit card which gives 5% cashback. However, you have to use visa paywave for your payments and have to keep withdrawals from the ATM at 3 times or lesser. For me, this is very hard to achieve.

So, I signed up for some credit cards which gives good cashback for my spending. This is easily done for those who has a stable income. If you've started working or have been working for awhile now and do not have any problems controlling your spending, getting a credit card is more beneficial than not having one.

My favourite cashback credit cards is still the Standard Chartered Unlimited card and American Express True Cashback card. Both gives 1.5% cashback on ALL spending (online or offline) and 3% cashback for the first 3 months for the AMEX card. Getting credit cards has even more perks because often there is good sign up bonus. For example, I got $138 credited into my card when I signed up for the SCB unlimited card and additional $100 vouchers.

There's also a new credit card that gives 2% cashback. This is the Standard Chartered Spree credit card. There is no minimum spend and 2% cashback is given for all online and contactless payments.

Currently, there is promotion to get $150 Grab gift for many of the credit cards below. Promo ends 15 Nov 2017.

There are many other cards available too. Click on the image to apply and grab your Grab Gift:

*Note: Grab Gift only applicable when you apply through the above links

Possible extra cash savings: $150 gift + a few hundred dollars cashback

Finding the best deals

There are many deals I've found out over the years which is so good sometimes I don't believe its true. Fancy some 50% off for your dining? Special discounts for movie tickets? Or half price for your shopping? All these are possible with just a touch of your fingers.

Most deals are found online now. For dining, some of the best websites to make reservations is Chope and Eatigo. For Chope, they give 100 Chope dollars for very reservation made. Just 400 Chope dollars and we can exchange for a $10 restaurant voucher. That's $10 off for every 4 reservations only.

The best is still Eatigo which is a dining reservation app that gives up to 50% off your total bill for the restaurant you book at. You can get 50% off for a buffet at Swissotel The Stamford or fancy 50% off for some Michelin star restaurant at Marina Bay Sands? All these can be done using Eatigo to book your reservation.

There are many restaurants on the website which you can look through. Many people are paying the full price for their dining but you can enjoy the same meal for just half the price at the same restaurant. That's the smart way of dining.

Possible extra cash savings: $100+ for each meal

There you go, 3 simple money hacks you can start to make the best out of your money. Part 2 will go more detail into money hacks for movies, shopping and travelling. Stay Tune!

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Monday, September 25, 2017

What Happened To Comfortdelgro? - The Taxi In Distress

Comfortdelgro has been on the hot seat for the past few weeks with share price dropping to a low of $1.98 now. Grab and Uber seems to have an upper edge in this taxi business competition. It is crucial to review Comfortdelgro's business at this junction to see what it is really worth. Separately, it didn't manage to get the new Thomson East Coast line which could have boost its operating profit by about $12-$18 Million a year. Let's take a look at its different business segment and break it up to see what it is really worth.

Public Transport Services Business

This is essentially its core bus and rail business segment with revenue at $1147.8 million and operating profit at $86.2 million for 1H 2017. If we annualised the revenue, assuming this segment continues to grow at the same rate, we should see revenue at $2294.2 million. For this segment, there will also be contribution from DTL-3 which will be opening in October 21 this year. If we assume their ridership to double which adds about 200,000 ridership daily, the revenue contributed for this FY will be around $8 Million. 

We should see operating profit for the full year at $177.3 million. 

FY2017 Operating profit: $177.3 Million

Taxi Business

This is the tricky part to analyse but I will try my best to make sense of the numbers. Revenue stands at $618.5 million and operating profit at $72.3 million for 1H 2017. The fleet size of comfortdelgro is about 15,472 as at July 17. This is down from the fleet size of 16,821 in 2016. I estimated the rental of each taxi to be $120/taxi per day. At this junction, the taxi business is estimated to shed $59 million in revenue for the whole FY2017. 

The estimated revenue drop for Singapore's taxi business alone will be around $59 million. There are still other countries' taxi segment which may also face headwinds. If we assume a $70 million drop in revenue, full year FY2017 revenue should come in at $1270.8 million. 

Assuming total cost stays the same as FY2016, operating profit should come in at $97.5 million.

FY2017 Operating profit: $97.5 Million

Bus Station

The bus station business should remain stable. 2Q 2017 profit came in at $3 million. Annualised this, we should see a profit of $12 Million for FY2017

FY2017 Operating profit: $12 Million

Automotive and Engineering

This segment will see a decrease as lesser taxi fleet size means lesser servicing revenue also. 2Q 2017 profit came in at $11.4 million. Annualised this, we should see a profit of $45.6 million. A further reduction of taxi fleet will put pressures on this segment moving forward. So a conservative profit of $45 Million can be expected. 

FY2017 Operating profit: $45 Million

Inspection and Testing Service

This segment should remain stable too. Profit for this segment should come in at around $30 Million for FY 2017. Q2 2017 came in at $7.6 Million. 

FY2017 Operating profit: $30 Million

Car rental and leasing

Car rental has been facing a lower leasing fleet in Singapore and China. The profit should be about $6.4 Million for FY2017.

FY2017 Operating profit: $6.4 Million

Driving Centre Business

This segment should remain stable. Profit for FY 2017 should come in at $11.2 Million.

FY2017 Operating profit: $11.2 Million

Total Value of CDG's business

Now, we can add up the different segments and get the FY2017 estimated profit to derive the actual value of the company. Total operating profit for FY2017 should come in at $379.4 Million. This is 17.9% lower than in FY2016. With this, profit attributable to shareholders should come in at $246.6 Million. 

With outstanding shares at 2162.8 Million, EPS will be estimated 11.40 cents for FY2017. With this EPS, PE ratio will be 17.37 at current share price of $1.98. 

To put things into perspective, if the taxi fleet decreases by another 2000 for the next few months, EPS will be about 10.4 cents. This means the PE will then be 19.04 at current price of $1.98. Looks like at current price of $1.98, it will only seem fair if taxi fleet does not drop too much again. If taxi fleet continues to drop drastically, the situation can get much worser. 

Business times had a very good article on Comfort Delgro valuing its business at $1.70 if we exclude the taxi business. This is using a simplistic 20 times multiple of net profit. Of course, this will only happen if all Comfort taxis disappear from the streets once and for all which I don't think will happen at least for now.

It is also interesting to note that despite all the competition, the average daily number of taxi trips only slightly decreased by about 1 trip per day as compared to 2016. Comparing to 2015, the average daily number of taxi trips decreased by about 2 trips per day. Average daily number of taxi trips stands at 17.8 for one shift taxi and 27.5 for two shift taxi as at July 2017. This means that taxi drivers can still earn quite a decent income even with the fierce competition from private hire cars. 

There are many factors to consider in this investment and it is definitely not for the faint hearted. From my perspective, Comfortdelgro's taxi business should still continue to exist in Singapore but probably at a smaller market share in the future. It would be quite hard for it to go back to its $3 stock price value as the market adjusts itself to consider the future value of the company. For grab and uber, it is still an unknown how long they can keep offering discounts and burning cash month after month. How the taxi industry will evolve in the future will be for all to see.

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Wednesday, September 20, 2017

The Two Japanese Reits Which Got Acquired - What Can We Learn From This?

It has been a fruitful journey investing into Japanese Reits for the past few years. Saizen Reit was the first Japanese reit which was acquired earlier before. Recently, Croesus retail trust, a Japanese reit which owned Japanese shopping centres was also successful acquired just last week. What makes them so attractive that both reits from Japanese were bought over at a premium price?

I've written extensively on Croesus Retail Trust as early as back in 2013. The timeline of the posts are as follow:

The purpose of the sharing of the previous posts is to look back at my thoughts and why I invested in Croesus in the first place. Time pass very fast. 3 years plus just went past like that. As you can see, in April 2015, I went for a Croesus retail trust retail investor day where I manage to hear from the top management of Croesus itself. I wrote in my blog that I was happy with what I heard and the management knows what they are doing. As soon as a rights issue came, I immediately subscribed to it to increase my holdings in this investment.

Last week, Croesus was acquired at a price of $1.17. My average price for the reit is about $0.80. This represents a gain of 45%+. Including dividends, the total ROI for this particular investment works out to be about 81%. It was a long journey nevertheless.

What caused the Reits to get acquired?

The most important lesson is to find out what cause the reits to get acquired and hopefully we can always buy into the right companies which generates value for shareholders. In the case of Croesus, when I first invested in it, it was purely base on the fact that the Japanese government was aggressively trying to expand their economy through quantitative easing. They had a target of 2% inflation back then when Japan was facing decades of deflationary economy. Noticing that this was an opportunity, I went to search for companies which deals with properties in Japan. Saizen Reit and Croesus came up as an investment choice.

Next, I looked at the stability of its income which is important for a reit or business trust. Saizen reit was in the residential rental business so it was really stable. It was rare for a reit to be in the residential business. Croesus on the other hand is involved in shopping centres which had some risk in itself. However, upon a closer look, Croesus management were quite committed in achieving good value for shareholders through the many positive rental yield acquisitions and AEIs. They were committed in keeping the company's balance sheet healthy also.

Finally, the Japanese reits was trading at an attractive price which was below their book value. Many of their properties were valued conservatively when you compare their properties valuation against the other nearby properties. Furthermore, Japanese real estate and rental prices were going up steadily over the years which was an added positive development. All these attracted other big investors to offer attractive prices to takeover the 2 companies. Sure enough, it happened and shareholders got rewarded.

There will always be more opportunities in the future for those who missed it. For fellow shareholders of Croesus retail trust, congrats to all!

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Tuesday, September 12, 2017

5 Lessons I Learnt From Those Who Have Achieved Financial Freedom

Let's be honest, all of us want to be rich. I started my financial journey many years back by finding out how the rich manage their money and how exactly I can do it like them. However, most probably, the information you've been finding is all directed at the super rich. How about common people like you and me? Are we able to have a little more money so we can not worry about it anymore?

Throughout the years, I've had the opportunity to meet and speak to people who have became financially free. Every time I talk to them, I learnt something new and truthfully, its not as complicated as we thought it would be. In this article, I will list down the lessons I learnt from my interactions with these individuals who have managed to get out of the rat race.

Lessons I Learnt From Those Who Have Achieved Financial Freedom

1. Financial freedom is not just about saving money

The first lesson I would bring out is that financial freedom is not just about saving money. Oh wait, do you mean I don't need to save money? That is not true either. I've seen people who have achieve financial freedom as a single person, as a married person and even as a person with kids. When I look at their lifestyle, certainly it is not just about saving money.

Most of the time, we start off our financial journey frantically saving as much money as we can. However, in our younger days, we would realise it is very difficult to save money not because we spend too much but because we have limited income. As our income increases, we would find it easier to accumulate wealth. This brings me to my next point.

2. Low income is not easy to achieve financial freedom

Income is an important equation in financial freedom. To put it simply, if we earn $2000, saving $1000 is 50% of our salary. But if we earn $4000, saving $2000 is 50% of our salary. It is impossible to save $2000 with only a $2000 salary.

Therefore, it is important to focus on upgrading our skills to increase our income. When we are younger, we should focus on getting more experience so our value becomes greater and greater. If we are unable to go up the corporate ladder, there are many other ways to create more income through part time business and freelancing etc.

3. Cash must always be flowing

Another lesson I learnt is about cash flow. The reason why its called cash flow is because it must be flowing. In business, if cash flow stops, the business is in danger. This happened to several oil and gas companies who could not generate enough income to redeem back the bonds they issued out. In our personal lives, this is liken to having not enough income to sustain our lifestyle. This could be due to overwhelming debt because of poor financial management or just pure overspending. It could also be due to not enough income or not enough cash to sustain our life if we lose our jobs.

4. Make your money work for you as early as possible 

This point is about investments. When I speak to those who have achieved financial freedom, they would always say that I'm still young and its the best time to grow my money now. Then, when they talk about investments, its always not about the hot stock or the best tips but about the most boring and routine investments they keep doing over and over again.

The safer the investment, the better it is. That's the wisdom I learnt. It can be so safe that they even recommend putting your money into CPF to get the 4% interest which is sort of guaranteed by the government. For stocks, we just have to buy low, get dividends and sell high. One strategy I've heard again and again is buying into stocks at an attractive valuation, selling partially when its at a fair price and then buying back again when it goes back down. This is like keeping a base of your capital in the stock and then trading around it over time.

5. Live off dividends and you've reached financial freedom

Many have stopped working because they realised they could survive on stock dividends alone. This is the path to financial freedom. We must know that achieving this is not by buying into the stocks in just a few days or a few months. In most cases, this takes many years to build, buying into opportunities when it comes. For example, some of them have stocks in their portfolio which they bought at such attractive price that the dividends they received have covered their initial cost and they are still getting dividends until now.

When crisis strikes, the dividends can be more than 10% when the stock price is very low. This happens for most Reits during a crisis. If the company survives the crisis, the price recovers and dividends increases as well. Its such a good investment that you won't even have to sell the stock ever again.

Financial Freedom Is A Journey

There you go, 5 lessons I learnt from those who have achieved financial freedom. The last and final wisdom I would like to share is that financial freedom is a journey. It certainly takes time and patience to stick with what we have to do. We should never think of getting rich quick as it could land us into a much worse state than what we can imagine.

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