Tuesday, 27 December 2016

Balance Transfer $12,000 from Maybank *Approved*

Balance Transfer Approved
Previously, I wrote about balance transfer or fund transfer for improved cash flow to meet short term needs. 

The purpose of this post is to share some information for those that need this short term cash flow to settle immediate needs (higher interest loans, overdue credit cards and etc.) 
DISCLAIMER: I am not encouraging anyone to take a balance transfer or fund transfer.  I am taking it because I am very confident I have the means to pay off the outstanding amount within 6 months without any hiccups. 

Saturday, 24 December 2016

2017: 3 REITs that AT will invest in for passive income

Merry Christmas to all my readers! I am very glad I made the decision to keep my blog running despite a long break. Thank you for your support! 

In this post, I will share a few REITs that are already on my watch list for 2017. They are namely Keppel REIT (K71U), Suntec REIT (T82U) and Capitaland Commercial Trust (C61U). I am waiting patiently for even lower prices to accumulate them.  

Monday, 19 December 2016

5 Investment Tips I Learnt From Playing Pokemon Go!

Pokemon Go inspired Investment Tips!

This post is a simple analogy for beginners to better understand investments in general. It is dedicated to all investors whom are also Pokemon Go players.  While chasing the Santa Hat Pikachu around my neighbourhood over the weekend, I had an inspiration to relate the mechanics of Pokemon Go to investments. 

Legends - 
Pokemon = Investment Opportunities.
Pokeballs = Resources (Time and Money) 

Wednesday, 14 December 2016

4th Quarter 2016 Portfolio Review

Welcome to AT's first and last portfolio review for 2016. The main purpose of my portfolio review is for my personal reference and to share some ideas guiding my investment decisions. I love dividends, but I am not a hardcore yield hunter. My portfolio was built up on cyclical play over the last 2-3 years and it is too heavily overweight on commodities. Albeit the lack of diversification, it was an excellent year as my portfolio increased significantly due to rising commodities prices (after they hit rock bottom for the past 2 years).

4Q 2016 Portfolio Value: Between S$60 - 80k at age 28

Friday, 9 December 2016

Balance Transfer: Should You Take It?

For the uninformed, balance transfer (sometimes known as fund transfer) is similar to a short term bridging loan usually for tenure of 3 months, 6 months or up to a year. The bank providing the balance transfer will charge a one time processing fee and "promotional" interest rates on the money they disbursed to your credit card / bank account. 

Original Purpose of Balance Transfer

Source: www.ocbc.com
The original purpose of a balance transfer is to use the "promotional" period where the interest rate is low (at the time of this post, effective interest rate [EIR] is around 5-8% pa) to settle outstanding debts with higher interest rates (e.g. 24% pa credit card). As per above illustration, you will be able to save a significant amount of interests payable. 

Tuesday, 6 December 2016

How To Pay Less Income Tax LEGALLY

Source: https://www.iras.gov.sg/irashome/TaxSeason2016/
Click Image to Zoom In (note: info is for YA2016, the upcoming one is YA2017)
Now is the time of the year where you need to take stock of your personal finance so that you can legally pay less income tax for YA2017. Why is this important? I am a firm believer of this expression by Benjamin Franklin, "a dollar saved is a dollar earned". In fact, a dollar saved today is BETTER than a dollar earned in the future due to time value of money.

Some of my friends and relatives do not like to go through their income tax returns because they think it is too troublesome. I wouldn't complain since their contribution will be channeled towards our nation building. For tax residents (Singapore Citizens (SC) and Permanent Residents (SPR) who resides in Singapore) who like to find out how to pay less income tax legally, read on....

Saturday, 3 December 2016

Voluntary Cash Top Up to CPF SA, A Story of Delayed Gratification

Retire comfortably with CPF-SA
This is a story of Tom (age 28, earning close to median monthly salary of $3,500 per month), a man willing to sacrifice short term pleasure for long term gains. As end of the year approaches, many of us might be thinking of a short getaway trip especially during the festive seasons. A short trip to our neighboring countries would usually cost around $1,000 per pax inclusive of flights, accommodations and overseas spending. For Tom, the cost of a trip probably closer to $2,000 as he pays for his wife's expenses as well (I believe most men still do despite ladies earning their own keep).

Thursday, 1 December 2016

Excellent time to invest during Black Friday and Cyber Monday

Last weekend was the Black Friday and Cyber Monday weekend. I always make a point to invest during this period as there are significant discounts on..... books! The world is constantly changing with new trends and technologies. Therefore, we must always continually invest in ourselves to keep pace with the world.

When is a better time to invest in yourself? 

Friday, 25 November 2016

4 Steps to Start Investing with CPF Investment Scheme (CPFIS)

The CPFIS provides an option to invest your CPF monies to enhance your retirement nest. For most of us who are still paying off our mortgage loan, it might not be a good idea to lock up too much of your CPF monies in investments. It is always good to save up a few months of your mortgage payments in case of rainy days. However, if you are confident you would not be needing your CPF monies for whatever purposes and would like to generate more returns than the prevailing interest rates, this post is here to assist you!

Sunday, 20 November 2016

Expenses 1011. Because 101 is way overused.

Are you working for someone else's dreams now? If you are, stop whatever you are doing to finish this article. 

You achieve financial freedom only when your passive income exceeds your expenses. Therefore, for many of us, even when household income from our employment exceeds $10,000 per month, we do not feel financially free at all. Why is this so? In this post, let's talk about the two big elephants in Singapore. 

Tuesday, 15 November 2016

Take Advantage of Supplementary Retirement Scheme (SRS) Account (Part Two)

There are many articles (see part one of my post on SRS) that identified the benefits of contributing to your SRS account. In this post, we will examine the amount of penalty for if you decide to withdraw your funds earlier than the statutory retirement age (currently 62).

Case Study 1
Max, aged 45, withdrew $30,000 from his SRS with a taxable income of $60,000: 

Total penalty = 5% early withdrawal penalty + 100% of withdrawn amount taxed at prevailing rates.

If we calculate, we will derive at $1,500 for early withdrawal penalty (5% of $30,000). As for taxable income of $90,000 ($60,000 original taxable income + $30,000 withdrawn), the total tax amount is $4,500. This is $2,550 higher than the original income tax of $1,950. Therefore, in total, Max paid a total of $4,050 ($1,500 penalty + $2,550 additional taxes) to withdraw $30,000 from his SRS account.

Monday, 7 November 2016

Take Advantage of Supplementary Retirement Scheme (SRS) Account (Part One)

The main purpose of SRS is to supplement our retirement income, quite obvious from its name. Here is a quick summary of the features for those who have not heard of the SRS. You can make contributions to your SRS annually (up to $15,300 for Singaporeans and $35,700 for foreigners) and when you withdraw them at statutory retirement age (currently 62), only 50% of the withdrawn amount is subject to tax. Do you know how else you could take advantage of the SRS account to build your portfolio? 

Saturday, 5 November 2016

Hillary Clinton vs Donald Trump: How does it affect the Singapore Stock Market?

Who will win the US Presidential Election? 
As the US Presidential Race heads into the final week, how is it affecting the Singapore market?  Just 1 to 2 weeks ago, major polls results point to Clinton having a large leading position over her opponent, Trump. Stock market rose in both US and Singapore. The US dollar rose as well.  

Surprisingly, coming into the final week before the election on 8th November, we hear news that the race is tightening between the two candidates. The market reacted negatively to this latest polls results and the Singapore stock market, STI has not been spared. STI ended this week at 2788.80, below its support of 2800 points. The US Dollar did not perform well this week either, dropping off its recent high.

Tuesday, 1 November 2016

3 Ways to Invest With Limited Capital in Singapore

I believe many of you have heard of this phrase: "let your money work for you". However, a substantial amount of capital is often hard to come by, especially for young adults that have just entered the workforce not long ago. Personally, I have experienced the difficulties faced by an investor with limited capital when I began working. More often than not, after factoring living expenses, there is not much left in the bank for investment purposes. Further, the minimum brokerage fee charged by most brokerages in Singapore makes the cost of entry prohibitive for investors looking to invest a small amount or perform dollar cost averaging (DCA). In this post, I recommend 3 ways how you could invest with limited capital in Singapore.

1. Previously, Standard Chartered Bank (SCB) online equity trading account was the de facto number one for investors with limited capital. There was no minimum brokerage fee and you could invest any amount you desire. It was fantastic for DCA and a great tool for investors with limited capital. Regrettably, as of August 2016, SCB will charge a minimum brokerage of $10 for Singapore stocks and minimum brokerage fees apply for foreign stocks as well. Nonetheless at $10, SCB is, without doubt, still one of the lowest cost brokerage available in Singapore. For investors looking to invest less than $5,000 and have access to a wide range of financial products (such as stocks and REITS listed on various stock exchange around the world), SCB online equity trading is definitely one you could not pass up on.

2. Passive investor looking to build a relatively risk-averse portfolio by buying index funds and bonds funds, should consider the POSB Invest-Saver  The sales charge for Nikko AM Singapore STI ETF is 1%, while it is 0.5% for ABF Singapore Bond Index Fund. You can start investing from just $100 per month. Following the principles of portfolio allocation in this book Millionaire Teacher by Andrew Hallam, you can build a strong portfolio by allocating a certain amount to the STI ETF and Bond Index Fund depending on your risk appetite. In reality, low cost index fund outperform most actively managed fund in the long run. Therefore, this is an excellent place to start for investors with limited capital. 

3. Investors that absolutely have to do stock picking but wish to do it at a lower cost than the minimum $10 brokerage fee could consider OCBC Blue Chip Investment Plan (BCIP). With OCBC BCIP, the difference is you can invest with both cash and SRS (read more about how you can work your money harder with your SRS account). This is excellent for investors that make contributions to their SRS account religiously. You can choose to invest from 19 stocks that are known as Blue Chips in the Singapore stock market. the minimum fee is 0.30% or $5 per counter (whichever is higher). It would be wise to invest at least $500 to reduce the fees of your investments. 

I hope the 3 ways highlighted in this post could motivate you to start investing. It is alright to start small, but you have to start somewhere. Investment is a skill that you have to master to combat rising costs due to inflation.  


About the author

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Financial freedom = Passive Income > Expenses. Always remember that there are two sides to the equation of financial freedom. Beside working on how to improve our passive income through investing, we should never neglect the expenses portion. By striving to improve both side of the equation, we can achieve our financial goals and win in the game of money.

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