Tuesday, January 24, 2017

Escaping CNY 2017, Bye Bye!

Following the precedence that I have set last year, I have once again decide that I am going to escape CNY! I seriously dislike the whole CNY period.


The ONLY thing that I like is that I get to hear that song, but that's about it.

Anyway, I'll be gone for the next 2 weeks. I've been seriously looking forward for this holiday for almost 2 years now! A lot of planning and preparation has gone into it, though admittedly I've fallen short at the very end by being very bad at planning the finer details and coming up with alternative plans. I think my last few months has really been a whirlwind of trying to do too many things at once.

One of the main things about this 2 week holiday that is going to blow your mind is going to be about how cheap it is going to be, relative to all the things that I am going to do. I'll be doing my usual trip review like when I went to Tokyo, Japan, but I think this time I'll also be doing follow-up post that goes in deeper to certain parts of my holiday expenses to show just exactly how I managed to keep my expenses low.

2 weeks is a long time to be away, but it's going to be a good time for me to finally have a good break (since my last leisure trip was 1 year ago!) and get back focus into my life. I've a rough idea on the things that I want to think about as well as quite a few interesting topics that I am thinking of blogging about. I think the theme for 2017 for me is going to be Simplify.

Anyway, since most of you enjoy CNY, I hope yall have a good one here! See you all in 2 weeks!

Thursday, January 19, 2017

Upscale Property Cracks Emerging?

Just saw this interesting article on the Straits Times: Banker buys out 45 of the 55 units of an upscale FH condo in town.

45 out of 55 is kind of absurd, isn't it? Since it was a bulk deal, he managed to get in at $2300psf, or an 18% discount. For a FH condo in town, that really isnt too bad. It's 2 blocks away from an upcoming TEL station and just down the road from the Botanic Gardens.

Starlight Suits, Nouvel 18 and iLiv@Grange has also had bulk deals in the past 12 months, and they have all been discounted 22%, 16% and 23% respectively off the individual unit sale price.

Looking at these developments, I think it's safe to say that upscale units in the open market now are prone to at least a 20% drop in current conditions, and more if the backdrop of everything else deteriorates.

I'm very skeptical when it comes to Singapore property. I know exactly zero people who are looking at any private developments now. The only guy I know that can comfortably buy a private property is very happily renting because it just makes more sense for him to rent than to buy.

On the bright side, at least properties in Singapore aren't yet majorly screwed like some places in the US, where a mall was sold for $100, or 0.000000625% of its highest appraised price.

I really don't believe that real estate should be the default first investment that people rush into, but what the heck do I know?

Anyway, my takeaway from this is that prices are going down at least 20%. Let's see how things go.


Tuesday, January 17, 2017

How to Milk your Cash? Best Places to Park your Cash!


This post by Kyith has inspired me to write my own off-shoot version of where to stash your cash.

If you are collecting 0.05% interest on your bank account, you better pay attention!

I believe that there is a systematic approach to this. You just fill up the account that gives you the highest rate until the cap, and then you flow into the next account and the next account.

These are the 3 + 1 accounts / products that I would recommend and that I myself am using:
1. OCBC 360 (my post on it)
2. CIMB FastSaver (my post on it)
3. Citibank MaxiGain
4. *Bonus* Singapore Savings Bonds

But because I know y'all lazy af, I made a simple table for y'all to read and compare.


The first 3 products are very liquid (immediate withdrawal). They all don't have lock-in periods, though if you do close accounts within 6 months, most banks charge you a fee. I've purposely excluded other products because I think that they are inferior products due to (1) low yields or (2) complicated products.

The OCBC 360 has been talked to death, so it doesn't need much explanation (if you do, click to read my post up there). You just need to jump through hoops to get the maximum possible rate of 2.25%. Why is 2.25% the maximum rate when you can get up to 3.25%? Because the last 1% under the invest and insure portion is a scam for feeble minded people. Yeah, I said it. Hopefully none of you guys fall for that trap.

Why not SCB BonusSaver? Salary + GIRO + CC Spend is only 2.03%, and I feel that with the OCBC 365 card, it is easier to hit that $500 minimum spend.
Why not BOC SmartSaver? Salary + GIRO + CC Spend + Base is actually 2.35%, but BOC has horrible credit card offerings, so hitting that $500 is going to be a chore. *Note $6k salary crediting and $1.5k credit card spending is for the higher interest tier
Why not UOB One Account? UOB gives less interest than OCBC except for the extremely narrow bracket of $46,204 - $51,864. UOB only has the One card which I think it is good, but it is very strict in requiring 3 consecutive months of consistent spending.

The CIMB FastSaver is really the bomb. You do diddly squat and you get 1%. That's it. It's simple, no-frills. It is the perfect savings account with such a lower hurdle.

The reason why I listed Citibank MaxiGain after CIMB FastSaver is because of 2 reasons:
1. The much higher $15,000 minimum (eff Feb 2017)
2. The inflexibility to move cash around AND still get a high rate

The Citibank MaxiGain account is best thought of as a 1-time use account. You only put money in, and you never withdraw money, since it will reduce your account interest rate. However, the plus side of this account is that the rate builds up to be rather high without any of those silly hoops and hurdles to jump through.

I would strongly recommend the Citibank MaxiGain account to be thought of as a rolling fixed deposit. As such, the Citibank MaxiGain is the perfect product for an emergency fund. Instead of rolling over your FDs in accounts with minimum $20k, you can have it continuously roll at a higher rate, with the flexibility to increase your emergency fund at the current rate of your account (likely to be the maximum rate after 1 year). The best part is that you can also "break the bank" at any point of time, still receive accrued interests, choice to withdraw only partially and still receive a good rate for the balance, even after the rate drop due to withdrawals. Although inflexible to move money around, it is still liquid.

**BONUS PRODUCT**

The Singapore Savings Bonds come in last because it is slightly more complicated (need to open a CDP account and purchasing of it), rates are very variable and finally because it isn't immediately liquid. Withdrawal takes about a month, depending when you decide to cash out of your bond.

The rates that I have posted there is the range of MY OWN Singapore Savings Bonds issues that I applied for and received. The current issue open for application is between 1.05% and 2.44%, slightly lower than what I have. This money here is best used if you know your withdrawal requirement and are open with locking in a rate, but with the flexibility to withdraw earlier, if desperate. Think of it as Emergency Fund Plan B. Best used for conjuction with a big cash capital outlay and a very transparent date to withdraw.

That said though, if you are very sure that this is money you will not need to touch early (because you have a well-stocked emergency fund), you can actually consider looking for a good endowment plan that will match the lock-in period. I hate most insurance "investment" products, but not all endowment plans are bad, if you know how to pick a good one. For a 5 year lock-period, I have found an endowment plan with 38bps annual pick up (2.25% annualized) compared to the SSB. This is about 18.8% more interest by going with an endowment plan instead of the SSB. The downside is of course the absolute lack of liquidity and flexibility compared to what the SSB has. Understand your needs very carefully when decided if you are willing to sacrifice returns for flexibility, or if you want to have the highest rate possible and you don't mind to put yourself in an inflexible position.

Summary

Just a few years ago, the cash options in Singapore was pretty shit. I suppose that due to low rates globally, financial institutions have realized what a sizeable cash hoard is just waiting on the sidelines, and all these products are an attempt of the financial institutions to take a bite out of this juicy juicy market.

I'm not complaining though. Back then before all these products came about, perhaps the only methods of generating decent cash returns is (1) rolling over fixed deposits and (2) participating in a money market fund. Both of these products are fine, but they are so plain vanilla and with paltry rates. I have to say, I'm definitely more happy utilizing the options that are available in the market today.

A lot of people still forget: deciding to hold onto cash can be an active decision. Personally, I am actively choosing to hold onto cash and be light with my positions in the market. Holding onto cash is not as scary as most people think because of the "inflation monster" really isn't very scary these days. (Nov CPI all-items is still a big fat 0%, prices are still overall 0.8% lower than in 2014)

Cash is king if the economy crashes. Gold is king if the economy fails, but that's another story another day.

Thursday, January 12, 2017

$450 / 19.7% Credit Card Cashback Lobang Guide


Serious or not?

How to save $450 on credit card spending? Spend $26,666 on AMEX cashback and get 1.5% back, is it?

Not quite.

Well, here's what you need to do it:

1. Have a minimum income of 30k
2. POSB Everyday Mastercard (min income 30k)
3. SCB Manhatten Mastercard (min income 30k)
4. CIMB Visa Signature (min income 30k)

** All promos listed are valid until 31 March 2017 only, although they do have a tendency of getting extended. PLEASE OWNSELF CHECK OWNSELF**

The first $160 + $1.50

Sign up for the POSB Everyday card online and get $160 cashback when you spend $500. The card has a base 0.3% cashback on everything, so you can get $1.50 cashback from that too.

Keep card in drawer.

Set a reminder in 11.5 months to get ready to cancel your card.

*Only new cardmembers get $160 cashback. Existing cardholders only get $100 cashback.

The next $138

Sign up for the SCB Manhatten Mastercard online and opt for choice (c), which is $138 cashback. After card activation, you get the credit within 1 month and you have 6 months to spend off the credit (t&cs). Good bonus point is that all spending have a nice base 0.5% cashback.

The next $150 + $3.60

CIMB cards are dope because they have no annual fees and are free for life. Sign up through this online promotion and opt for the Visa Signature card.

Plan and shift around your spending so that you charge $300 to your card every month for the next 6 months and get back $25 a month, along with base cashback of 0.2% of $0.60 every month.

Fast forward 6 months and $1800 later, you should be getting back $150 because of the promotion and $3.60 from the base cashback.

Housekeeping

Remember to cancel that POSB card after the 1 year fee waiver is due.
The SCB card also only has a 1 year fee waiver. However, ask them towards the end of the period if that can be extended. If not, cancel that bitch!

The CIMB card is free for life with no annual fees. Nothing to worry about if you cancel all your other cards. You'll still have an honest card with 0.2% cashback :)

Summary

Spending over 6 months: $500 + $1800 = $2300
Cashback over 6 months: $160 + $1.50 + $138 + $150 + $3.60 = $453.10

Cashback rate: $453.10 / $2300 = 19.70%

On top of that, you now have 2 good, general purpose credit cards to use for your everyday purchases. The SCB Manhatten would be your daily driver with a base 0.5% cashback with no minimum spend or worries. The CIMB would be your backup card with a lower 0.2% cashback and also no minimum spend or worries. The POSB card can be in your wallet just to take advantage of specific bank / card promotions only. If there isn't any compelling reason to use the POSB card, just keep things simple and stick with the SCB + CIMB combo.

However, once you go overseas, there is a role reversal to your main card. Charge your overseas travel to your CIMB card and get basic complimentary travel insurance. Spend with your CIMB card, since the card waives foreign currency bank fees (usually 1.4% - 2% by the banks), so you would save that amount and only pay the 1% fee using the Visa payment network.

With a Visa and Mastercard combo, you will find it hard to find a merchant that won't accept 1 of these.

So, what do you think about this lobang? Huat or not? Let me know if you enjoy this kind of post so I know if I should post others like this!

Tuesday, January 10, 2017

2016 in Retrospect, 2017 Looking Ahead


I'm late. Some bloggers started writing such posts about 2 weeks ago already! I guess I'm the last blogger to come and play this game, eh? Well, the good news is that maybe during that 1 week where every other post was about the same new year thing, maybe you got bored and skipped reading half of them. Hopefully mine is a bit more interesting!

For my personal SGX portfolio (which I have unfortunately been extremely lazy to post about, but still update my spreadsheet which is linked to my sticky page), I actually did pretty well I thought. My portfolio total returns for the year is almost exactly 5%.

I use some strange method to calculate my performance and my benchmark. It is using IRR and comparing it to the STI ETF if I had invested in the same amount of money as well. It's definitely not comparable to annual returns. Whenever I inject capital, I similarly buy the STI ETF in my hypothetical portfolio and vice versa when I sell. The problem is that odd lots would exist, but I just imagine that if I could buy almost exactly, how would that hypothetical portfolio perform. And to give myself a disadvantage, I not only buy the STI ETF in exact decimals (no odd lots, so no idle money), there is no transaction costs counted for that portfolio (while my portfolio includes transaction costs) and finally, I take the lowest price of the STI of that month to purchase the units.

It's a bit weird to do it this way, but it suits me because I couldn't give 2 shits about annual performances of my own portfolio. I'm not a fund manager and I have no KPI. I don't need to hit some arbitrary number for my annual returns because I don't invest annual. Returns aren't 7% every year. Returns are lumpy. I invest when I have money to spare and I sell whenever I feel like it, not at the end of the year. Annual performance is useful to compare asset classes since it's basically time weighted to one year and removes all the complications of cash flows, but that's not what I'm measuring. I'm measuring if my money is better spent sitting elsewhere.

Surprisingly, my real world SGX portfolio has bested my hypothetical STI ETF portfolio. Comparing both strategies, I have beat it by about 1.5% in 2016. If comparing since inception, I would have 8% more value than my hypothetical portfolio. I'm quite surprised and I guess I would put it down to the fact that my portfolio has very low beta to the STI ETF.

My best portfolio trims were PEC and Frencken, where I net 57% and 36% total returns in those investments. My current best is Super Group, up 35%. My current worst are Casa Holdings, Sing Heng Heavy Mech and Valuemax, down 57%, 47% and 36% respectively. These duds make up just 2.8% of my portfolio based on current valuation, or 5.1% based on capital investment. Though eye popping numbers, they are contained and managed within my portfolio.

My capital investment is up about $5000 from last year. I received $1552.31 in dividends over the last 12 months. That works out to about almost $130 in dividends per month.

The portfolio that I run for my mother and sister is also chugging along just fine. Their portfolio is using 3 asset classes - stocks / bonds / cash - and the allocation is now 10% / 27% / 63%. I might be increasing the bond portion of the portfolio up to 35% or 40% by the end of the month. Anyway, their performance for 2016 was a nice 2.44%. The portfolio dipped slightly in Jan and Oct, but it has been slowly and steadily increasing in value. It's a rock solid portfolio. I am prepared to blast away and shift allocation to all stocks if and when the STI starts to falter.

Investments aside, I've been a good little saver, saving up money for when the time is right to jump into the property market. I have been literally waiting for years now, and I am pretty sure that we still go lower inspite of whatever all those biased "property experts" say. We go at least another 10% or 15% down before cooling measures are lifted, and that won't even be a guarantee to stop the landslide in property prices. Private property owners are grossly overestimating the waiting power of the millennials like myself with the purchasing power to buy private properties. I can wait indefinitely and stay with my parents and lose nothing. They are drained by monthly condo maint fees and mortgage repayments. Let's see how long they can hold out. The development that I have been looking at has had sellers hold its price for well over a year, but the cracks are appearing. The listed price has recently dropped over 10% in the past month, but it still has plenty of ways to go before I even start reaching for my chequebook.

Health-wise, I've managed to slowly (and healthily) manage my weight and change my diet habits. I'm now a full belt hole down on good days, though that is not always the case, haha. I've changed my mindset to be more okay spending more money to eat healthier and more conveniently, which is an upgrade in lifestyle, but a good one if it leads to better health and wellness. These days unhealthy food are no longer as appealing to me as before. I've also lost the will and drive to sample 1 bite of everything at a buffet line. Now I just eat what I enjoy without trying to "eat my money's worth". The new diet and mindset has made quite a change. My complexion is slowly improving, while my fitness has also gone up. I managed to get the IPPT incentive, but I was just 2 points away from Silver! My scores for all stations have improved from the previous year.

Travel-wise, I only managed to escape just once in 2016. I went to Japan for a week long holiday and spent just $1400 and had one of the best solo trip experiences ever. It's was a timely reminder why I used to enjoy travelling and how travelling alone can still be super fun.

I would say that overall 2016 was a decent year, though it didn't have very notable highlights to me. I'm glad that it didn't just flash past with zero improvements to my life. I am wealthier, more knowledgeable, hopefully wiser, healthier and happier.

2017 Looking Ahead

First up is definitely about my house. If the property markets starts cracking, I'll be busting out my resources and will be self-teaching myself everything about housing and real estate before I finally take the plunge. Like TTI said, it's like big game hunting with 1 bullet. I'll try to make it count.

With such high cash needs for a house, I'm not so sure what will be left of my warchest. If the market falters, I'll likely be jumping off the cliff right after it to chase it with whatever I can spare. I do have to emphasize that I am still going to keep my emergency funds intact and I strongly doubt that I will be taking advantage of any of the leverage options to buy stocks.

I'd imagine that there would be a lot of opportunity in the local market. As previously mentioned, I will TRY to stick to my plan and buy blue chips on the way down, and non-blue chips on the way up, especially REITs. In any case, I don't think that we bust and boom within a year. I'm thinking it's going to be more of a slow and painful death as opposed to a cliff drop.

Gold and Silver looks ready for a magnificent take off. The problem for me will be deciding how much I would want to continue holding onto, and how much I am willing to cash out and realize my profits. I have quite high hopes for gold, with more muted and shorter term expectations for silver. Hopefully by May we can see Silver up to $25 USD and I can unload some of my positions. It will definitely come in handy to provide more cash.

I'm going for 2 trips this year and I will definitely give you guys an update. The upcoming 2-week trip is going to be awesome! I can't wait to blog about it once I get back from it. Hopefully I will have decent photos to share. My phone is getting very slow and buggy. I can't wait to upgrade handset to the new Samsung flagship in a few months.

I'd continue to focus on my health. I'm aiming to improve my fitness to IPPT Silver and try to build up and maintain a habit of regular routine exercise, as opposed to the very messy and ad-hoc scheduling system that I have now.

My next goal is to actually continue with my language studies. As much of a basket case that I am with Mandarin, I'm actually well on the way of reaching very comfortable language skills with a language I started from scratch just 2 years ago. I've ended my once a week formal classes and I'll be winging it on my own, self studying and trying to improve! I have to say that I really enjoy and am quite glad that I decided to learn a language, instead of something else. It has been a fulfilling experience so far!

The final goal is to continue to be an active financial blogger. My posts have dwindled down drastically from 2 posts a day to now just once a week. Hopefully I can get back into a groove. Maybe a routine would be good for me, with scheduled posts every month and special editions along the way if something comes to mind. If I can get back into a good groove, I might be exploring a new ad network to increase my revenues at the mid year mark!

So yup, that's probably what I'll be focusing on for 2017. Staying cool and calm in a potentially chaotic market, and continue to improve myself bit by bit.

And also as always, to continue to be very happy and content with my life.

Let's see what 2017 is in store for us! I'm excited! Are you?

Monday, January 9, 2017

New Year, New Lobang for You!

I'm a bit late to the game of reviewing 2016 goals and posting about my 2017 goals, but I've got a lobang which I thought I should share!

Udemy is an online course learning platform and you can pretty much learn anything you want there. I wrote about these kind of online courses before, you can take a look here, or just continue on. The prices are very reasonable, especially when there are sales, since it is e-learning (note: DIRT CHEAP). Even the gov recognises this, which is why quite a number of online courses on Udemy are available for skillsfuture claims! Gov pre-approved leh, should be good hor? Of course, usually the courses that are available for subsidy are quite work-skills related, not like "How to build a Successful Instagram account". Haha.

Anyway, they are having a new year's sale that have all their courses for $15! This ends in 2 days. Don't worry, this isn't affiliate marketing!

Some of the regular prices of the courses are between $80 to $300, but there are even more expensive courses than that! Are these courses expensive? Well, ask yourself how much are courses that you have seen being advertised to you? I think $15 is peanuts for what you can get. It's cheaper than most books, are much more immersive, with hand-holding and spoon-feeding content delivery. Books have their functions, but they are more like classics. The benefits of e-learning is that content can change and are updated along the changes in the world today. Today's reader's of Grahm's Intelligent Investor are probably all scratching their heads and balls when he starts talking about convertibles. Things like ETFs, low-cost funds and robo-advisors didn't exist back then. Technology and the ease of access to the information to chart prices and use technicals are now accessible to everyone instead and it is an extra tool that can be used if needed. Anyway, I digress. Books are great. But they might not be the best medium of instruction if you want to learn and apply immediately without constantly having to catch up and self-teach.

Many of these courses are really top quality and with plenty of hours of content. If you seriously pay like $50 or like $100 to attend some whatever courses, I can guarantee you that you are going to get equal or better quality content if you pick a good Udemy course (read the reviews, watch the preview, look at the curriculum outline), along with maybe 10 times more hours of content.

There are more courses than just personal finance, investing, accounting, business analysis, etc. There are tons of other topics to learn as well!

Personally, I've signed up for 2 courses with about a total of 20 hours of video content. For yes, $30. That is like $1.50 an hour, excluding resources for self study and worksheets! Please, if you can watch some movie at the cinema, you can definitely afford to drop $15 for hours of content! It's the costs of 2 Starbucks coffee.

One of the courses that I am taking is investing related (Skillsfuture claimable!), the other is about personal productivity. I was going to take another course regarding language, but I'm actually a bit busy studying another language already.

Seriously, if you ever wanted to take a course on accounting, finance, business, marketing, computing... whatever! This is a really good and cheap way to find out about the actual content and see if you are really interested in it. I'll be frank, the certification is generally worthless, but the knowledge isn't. You can be uncertified, but qualified and knowledge and if you can apply that, that's all you need. There are plenty of people that have been churned out through our school system that are certified, but are unqualified with no real-world experience. That's a different post for a different day though.

To re-emphasize a point I mentioned earlier on: some of these courses are Skillsfuture eligible (1518 courses to be exact. YES OVER A THOUSAND). The Microsoft Excel course seems to be a very popular pick. Now with the promotion, you can save your Skillsfuture money and direct those funds to a more expensive, and hopefully also useful course to improve yourself! I've already decided and I'm saving up my Skillsfuture credits for either an internationally recognized certificate, or language courses. I'm still undecided, but until I can decide, I am still plenty busy learning other things, so there's no rush for me to decide yet!

Notable Skillsfuture claimable courses:
The Complete Financial Analyst Course (UP: $210, 9 hours of content)
Guide to Financial Markets, Investing and Trading (UP: $70, 9 hours of content)
The Complete Web Developer Course 2.0 (UP: $210, 31 hours of content)
Master Microsoft Excel 2013/2016 for Beginners (UP $210, 20 hours of content)
An Entire MBA in 1 Course (UP $210, 57 hours of content)
Read and Write Japanese: Hiragana & Katakana (UP $105, 5 hours of content)
Portrait Photography Foundations (UP $210, 18 hours of content)
Learn Photoshop, Web Design and Freelancing (UP $210, 21 hours of content)

Anyway, the sale ends in 2 days I think, which is why I wanted to quickly bust out this lobang to you all, so that if you guys are interested, you guys can slowly browse through the huge number of available courses. If you have a new years resolution to learn something, you might be able to find it online and get a super good and cheap course instructor!

Think about it: with $15 and some dedicated time to learn and practice, you can upgrade your Excel skills to a super level! If you get that promotion or pay raise, you can thank your $15 and me for the lobang. If superior Excel skills can't help you in the working world, I'm not sure what else I could recommend that is as across-the-board useful.

A proper post to follow about resolutions soon, hopefully!

Happy 2017!

What are your resolutions, and what are the steps that YOU are taking to achieve your goals? Wishful thinking? Or real action?