After driving for the last 8 years, I decided to "throw in the towel" last year. It was a painful decision as I had to familiarize myself with the public transport again.

What have I gained? Money. More spare cash.

What have I lost? Some convenience.

After 8 years...

Taking the train was initially uncomfortable - the crowd during peak hours, the stuffy trains at times (when the air-con does not seem to be working), etc. There are always reasons not to like public transportation.

However, it has, technically saved time. The morning commute to the office is shorter now. I am working in the city and it is a direct station to station travel. There is no need for additional transfers, in my case.

Driving in the morning is not necessarily that convenient with the morning traffic jam. Taking the train also excludes the annoyance of paying the ERP and FINDING PARKING LOTS. Furthermore, I have began reading during the morning commute and this is something I appreciate a lot.




Uber, Grab Car, and Taxi

Apart from the train, I rely, occasionally, with taxi trips. At times, I will choose the mode that provides me with the earliest pick-up. But most of the time, I will just compare the prices and go with the cheapest option.

I like Uber and Grab because their pricing are pretty straightforward. Of course, having to choose the option of UberX and GrabCar (Economy).

UberX - Base Rate: S$3.00; Per KM: S$0.45; Per Minute: S$0.20
GrabCar (Economy) - Base Rate: S$3.00; Per KM: S$0.80.

Taxis, on the other hand, have so many sur-charges that even a Singaporean like me can't remember. There are peak hour charges (25%), midnight charges (50%), CBD charges ($3), booking fees etc.

Having said that, I do notice that Taxi fares might be comparable (or even cheaper) to UberX and GrabCar (Ecomony) during non-peak hours excluding the booking fee. If you flag down a taxi, chances are, the fare will be cheaper during non-peak hours.

For the record, I personally feel UberX has cheaper fares compared to GrabCar (Economy) as long as there isn't a massive jam. I will also stay away from UberX or GrabCar (Economy) if there is a price surge.

Money Saved

I never really knew how much exactly was it to maintain a car monthly. There are always the additional hidden costs in some months - maintenance, extra parking fees, ERP charges, traffic fines, parking fines etc. The total amount could range from S$1,200 to S$1,800 a month.

My transportation cost now, is down to only S$300 to S$400 monthly. It can even be as low as S$200 if I did not splurge on taxi/private car hire fares.

Conclusion

I do miss the convenience of driving - when I want and wherever I want. But, the money saved is definitely a big sum and it could be put to better use. I am still considering if it will be wise to buy a small weekend car when we have kids eventually.

Dilemma indeed. #firstworldproblems

People are probably more familiar with "Eat, Sleep, Train, Repeat". More commonly heard and I believe it is the mantra of many fitness enthusiasts throughout the world. I do often hear it from my slightly "crazier" peers that wants to be fit with a nice body.

“Eat, sleep, train, repeat” really simplifies what is essential for every successful fitness program. In fact, it is essential for a successful fitness enthusiast.

Now, "Salary in. Invest. Re-invest. Repeat" is not exactly my mantra but subconsciously I have been doing the same for a long period of time.

Started with learning how to Save

It all started with "Salary in. Save. Repeat" many years back. We all know the inflation in Singapore can be a nightmare for Savers, particularly with the low savings interest rates in our local banks. However, "Salary in. Save. Repeat" gave me a good foundation to build a sizable portfolio when I started to invest.

Read: Did I Manage To Save S$100K Before 28?


Discipline is still the key

At the end of the day, a mantra doesn't mean anything if you do not have the discipline to execute it religiously. Ask any fitness enthusiast, their good fitness, good body and good health did not appear overnight. It was years of effort.

Many people will be entice by get-rich-in-months schemes or training courses. But I still believe in the most traditional method of taking a step at a time to build my wealth. This is just my personal opinion. I am not bashing any get-rich-in-months schemes or training courses. These trainers had put in years of effort to build such expertise. These courses could kick start your investment journey but you still have to build your expertise over time.

Discipline + Right Knowledge is probably a better way of putting it.

Salary in. Invest. Re-invest. Repeat.

To sum-up, reasons for doing it:

1. I can't rely on bank interest rates.
2. I need my money to work for me.
3. I really do not want to have to work during my retirement years.
4. Most importantly, it has become part of my DNA to do it.

I have been watching 爱情保卫战 on YouTube recently. I can't believe such a show even exists. Comparing the shows on Channel 8 and 5, I think Singapore needs to be more creative in our reality shows. 爱情保卫战 is a China TV show featuring couples trying to resolve their issues. In fact, some couples featured in the show used it to validate their decision to the end their relationship.




Case 2: Girlfriend feels her Boyfriend is a Miser. They were just two different people having different opinion on money. One believed in quality (the Girl), the other believed in being practical (the Guy). I felt the Guy was overly practical and the Girl was overly spendthrift that led to their relationship issue.

This example should be quite common among relationships. Not being a miser but couples having different opinions on how to spend and save their money.


Case 3: Boyfriend believes buying 4D/ Toto is an Investment. I have heard people buying lottery as a form of hope. Buying lottery has an investment? We have to give this fellow (below) an award. The Girlfriend could no longer tolerate his gambling addiction and debts.

The impulse to overspend with credit cards can happen to anyone. I am no angel and do splurge on holidays (that were over my budget). We all know, and I hope everyone knows, charging more to your credit card than you can pay off when your bills arrive can lead to huge interest charges (plus late fee charges etc.).

I remember reading an article 2 years back in the local papers regarding Singaporeans overspending and being in debts. In the same article, it mentioned that the Monetary Authority of Singapore estimated that 3 per cent of unsecured credit borrowers' debt exceeded their annual income. The paper also estimated 43,000 people had debts of more than a year's salary.

43,000 might seem a small number in a country with 5 million people. And you wonder how did these people reach that state? So it came as a shock to me when I had peers who were heavily in debt. These friends earned pretty well, probably had a higher income than me. Their stories will probably resonate with many people. Let's just named them as Mr. Alan, and Ms. Betty and Couple Charlie and Cathy.

Mr. Alan, the Gambler



Alan was always known as the Gambler in the group. It was a must to have him during Chinese New Year. As long as there a chance to gamble, Alan will be there. As we all grew older, we started to earn a higher income, so did his gambling bets. He started betting heavily on soccer matches and visited the casinos regularly. An addiction to Blackjack, Baccarat, and soccer betting had Alan maxing his credit cards' limits. Eventually, he started paying the minimum sum for each card (God knows how many cards he had) and his parents found out about his awful spiral of debt. I really hope he has learned his lesson. But no! It just got worse. Lies, after lies, to cover the many reasons to borrow money.




Ms. Betty, the Shopaholic


Betty is a very attractive girl and has many followers in her Instagram account. She is always the one to inform my partner about great deals online and talking about the latest designer bags etc. It is not a surprise to see her latest Instagram post on her latest designer bag, or her holidays in Europe, or the fine dining restaurants she visited. She is not a show-off. She earns well and she spends to reward herself. But she felt into the trap of overspending and chalking up massive credit card debts. I just felt that she was living a lifestyle not justified by her income.


Couple Charlie and Cathy, living the high life


I was really shocked to hear about Charlie and Cathy. After all, I thought they were really high income earners. I was not very close to Charlie and Cathy and the perception of them "doing very well in life" was formed by their updates of Facebook. Charlie was driving a expensive European car. They bought a relatively good condominium. They dressed well. They wore expensive watches (not one, I can't even recall seeing how many different brands and models) and accessories. Everything seems perfectly fine. But just like Betty, they were extending their limits in their credit card. Indulging themselves in things they could not afford anymore. Their life was based on future credit. How I wish I was earning Charlie's income? I guess the temptation to spend more when you earn more will always be there.

Spend "the right way"

We do want a better lifestyle and probably very much influence by the media. A lot of overspending might also be due to peer pressure. Whatever the reasons, it is not wrong to feel that you deserve to indulge yourself. We have all worked hard. But if we reach a stage that we can only afford to pay the minimum sum of our credit card bill or we choose to do so (for whatever reasons), please seek help. Do not get caught in spiral of credit card debts.

Conclusion

Spend within your means. How do you retire when you are in debt? If you are a working adult, with no savings... Speechless! If you think controlling your credit card spending is tough, request for a lower credit limit. The impulse to overspend with credit cards can happen to anyone, even people with high income. 

Towards the end of 2015, I considered hard if I should park my money into the SRS account. It is always painful to part with S$12,750. We are talking about not being able to see my money (another S$12,750) for the next 30 years.

I started this journey 4 years ago and the idea was to complement my CPF savings for retirement. And, of course, enjoying the tax deferment on my SRS contribution each year. Plus, force myself to purchase an investment instrument for the long term.

Rome wasn't built in a day, but they were laying bricks every hour.

With each passing year (not exactly every hour), adding S$12,750, I am beginning to see a separate sizable retirement fund - 4 x S$12,750 = S$51,000.

I just have to keep this momentum moving year after year for another 16 installments.

Read: Topping up SRS Account for the 3rd Consecutive Year

My emergency funds has been deposited in both OCBC 360 and Standard Chartered Bonus$aver account for quite some time now. At the start of the month, I decided to make the effort to open the UOB One account.

UOB One account offers up to 3.33% interest annually for up to S$50,000. Really?

There are always terms and conditions to the interest rate. The interest rates are tiered for the UOB One account. See below.

Source - UOB One Account - How it works?

So the effective interest is no where close to 3.33%. In order to get the highest effective interest rate possible, account holders have to 1) maintain S$50,000 in the account; 2) Spend S$500 on your UOB One Card every month for 12 months; and 3) Credit your salary of minimum S$2,000 monthly or make three GIRO debit transactions monthly.

Fulfilling all the above conditions, with a S$50,000 deposit, we will receive S$1,216 annual interest + another S$200 UOB One Card Cash Rebate.

Source - UOB One Account - Calculator

That will give us an effective interest rate of 2.43% (not considering the S$200 UOB One Card Cash Rebate). Not really the 3.33% on most of their advertisements as shown below.

Source - UOB One Account

Nevertheless, at 2.43%, I decided to move most of my funds to this newly open UOB One account from my Standard Chartered Bonus$aver account.

This will definitely made my money work harder for me. I should have made the change earlier. Just hate the hassle of changing the account, changing the GIRO transactions etc.

One time pain but a good place to park my War Chest. Better late, then Never.

Read:
1. Higher Interest on your Money
2. War chest... oh war chest.. when should I use you?

I was just barely 6 months in my first job when the financial crisis of 2007-08, also known as the Global Financial Crisis (GFC), happened. I remember losing approximately S$12,000 (probably 50% of what i had) back then. I felt lucky exiting my positions earlier. But I didn't had the cash to take advantage and accumulate the stocks I wanted when the STI was way below 2000 points.

From that, I knew I had to save hard and accumulate cash. There will be a time (surely) when you will have the opportunity again. Many years later, I started reading financial blogs and the term - War Chest - resonated how I felt in the 2008 GFC.

Today, I have already worked for 7-8 years. Managed to save a decent amount. But I still feel my war chest is probably the mini war chest as shown in the picture. With the STI dropping close to 20%, I am wondering when should I use my mini war chest.

Source: ASSI AK Facebook Page

I do follow ASSI on Facebook and I know he has started his "nibbling". There were followers in his Facebook account that even tracked what he has "nibble" (Look at the picture on the left).

I believe AK has a very deep war chest. In this list of stocks that he has nibbled, I am also interested in Vicom, Wilmar and Accordia Golf Trust. Maybe not Starhub, but Singtel.

So the question to myself, when should I start using my mini war chest?

Should I be a little more patient?

What should my plan be?

Today, the STI bounce back 1.51%. Did I miss the boat?

I wanted to use 20% of my war chest when the STI was below 2800. Probably, another 30% when the STI is below 2350. And use the rest when the STI has dropped below 1900.

To be honest, it is easier to articulate a plan but to execute it... it is going to be tough. It is definitely going to test my pain level. I am still pretty fine with the current 20% drop.

Anyway, I came across this blog post - Can past give Singapore stock investors lesson or two on STI?

Straits Times Index 2007-09 ‘Subprime Crisis’

Source: Can past give Singapore stock investors lesson or two on STI?

Do read Soh Tiong Hum's article (above link). If history is to repeat itself, we are currently at Stage A. So maybe, I have not missed the boat. I will start using my mini war chest pretty soon.

In my earlier post - Should I Transfer Savings from the OA to the SA?, I grappled with the fact of transferring some savings from my CPF OA to my CPF SA before using the rest of the saving to lower my mortgage loan. Being able to finance my hosing loan is a consideration for keeping my savings in the CPF OA.

Here are some information:

1. Purchased a BTO (Singapore's Public Housing) that will be ready in 2017.
2. Purchased the place for ~S$575,000.
3. Paid 5% down-payment + Stamp duty using my CPF OA.
4. Remaining Loan amount: ~S$550,000
5. Will be taking a loan from Housing & Development Board (HDB) at 2.6%. Or should I not? 
6. Both my partner and me are working currently with no kids.
7. My current income is ~S$5,000. My CPF OA has ~S$120,000.
8. My CPF OA contribution monthly is ~S$1,150. 
9. My wife's income is ~S$3,500 and she has ~S$30,000 in her CPF OA.
10. My wife's CPF OA contribution monthly is ~S$805.

I did an enquiry on our eligible loan cap on HDB website. Based on our current income, the estimated maximum loan is S$562,000 with a repayment period of 25 years. Estimated monthly instalment at S$2,550.


Here are the plans:

Plan A:

1. Wipe out all our CPF OA savings (total: ~S$150,000) and take a loan of S$400,000 from HDB.
2. Estimated monthly instalment is S$1,815.
3. Continue to use CPF OA to service our loan instalment (total: S$1,150 + S$805 = S$1,955, more than enough).
4. No additional cash needed to service the loan instalment.
5. Big Assumption: Both will continue to work and earn the same income. Still thinking what we will be doing if we are going to have kids. That is a discussion on its own.

Plan B:

1. Wipe out only S$50,000 from our CPF OA savings and take a loan of S$500,000 from HDB. The remaining S$100,000 will still be in my CPF OA account. In order to do that, I will have to transfer S$100,000 into some investment product before transferring it back to CPF OA. I have to do my research if it is feasible.
2. Estimated monthly instalment is S$2,269
3. Use full cash to service the monthly loan instalment. My wife will contribute S$500 and I will pay the remaining S$1,769.
4. CPF OA continue to grow with monthly contribution of S$1,150.
5. Big Assumption: Both will continue to work and earn the same income.

Fast forward ten years, let's envisage what it will be like on Plan A:



Using DBS Repayment Scheduler Calculator (as shown above):

1. Remaining Principal Amount: S$270,239.69.
2. Interest Paid (so far): S$88,001.05 (painful!).
3. Both our CPF OA account will have S$0 (ZERO). Assumption is that we do not have any pay increment or bonuses.
4. Assumption - Since I am not on Scenario B, I will be able to save the S$1,700 monthly. Without investing in anything, I would have accumulated S$204,000 in ten years. If I have invested in something that gives me a yield of 2.5%, I would have accumulated ~ S$228,550. As for my wife, knowing her, no money will be saved.

Now, let's envisage for it will be like if I had serviced the loan on Plan B:


Using DBS Repayment Scheduler Calculator:

1. Remaining Principal Amount: S$337,799.62.
2. Interest Paid (so far): S$110,001.31 (very painful!).
3. My CPF OA account will have ~S$285,293. My wife's CPF OA account will have ~S$109,847. See below. Assumption is that we do not have any pay increment or bonuses. 
4. I will be super poor. S$1,700 a month :(. That is a big chuck of my salary.
5. We are able to finish paying the mortgage at the end of the 10 year using our CPF OA savings.

While there are some assumptions made, a well executed Plan B will allow me to finish paying my HDB apartment in 10 years. I am currently still in a discussion with my wife. A hybrid model using a portion of Cash and CPF OA savings to finance might be another option. Probably, using my wife's CPF OA contribution + my Cash to finance the loan is a better option.

Maybe, I will not transfer my savings from the CPF OA to the SA.

So, Cash vis-a-vis CPF Savings to pay off my Mortgage. That's the important question. 

Screenshot from http://www.ocbc.com.sg/personal-banking/accounts/360-account.html - dated 11 Aug 2014

Screenshot of an Standard Chartered advertisement on Bonus$aver

Good Interest Earn at No Risk