New Year Resolutions

Happy new year to all readers! On this first day of 2014, I would like to pen down some thoughts with regard to how the previous year had panned out for me, as well as my new year resolutions for 2014.

2013 had been an incredibly good year for both my career and my blog as well. Readership for my blog, SG Wealth Builder, has soared from 50,000 page views in 2012 to 440,000 page views in 2013. The dramatic increase was due to my commitment to blog more often, surge in my blog’s email subscription and also due to the expansion of my blog network. These factors had contributed steady flow of readers to my blog and spiked up the traffic.

Interestingly, my blog has also attracted new Singapore vendors to form business partnerships with me. I was approached by BullionStar and Fitch Learning to be their affiliate partners. Although there were several lucrative offers from interested partners, my policy is to promote only businesses which I believe in. Thus, I had previously turned down a few opportunities. One of them was to promote Malaysian properties investment seminars for a company which I politely declined.
career
Invest in myself
Many people, myself included, tends to chase the money and invest in everything under the sun (stocks, ETF, property,gold, unit trust, etc). Everything, except themselves. We all failed to realize that our knowledge, ability and skills are the most important asset that help us to generate recurring income through jobs, sales, investment and business activities. Henceforth, most of us tend to neglect investments on acquiring new knowledge or skill.
In this year, my new year resolutions are improving my presentation skills and learn web designing. The former is meant to enhance my career prospect, while the latter is more for personal
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Career Management: The Power of Doing Less

2013 has been a hectic but rewarding year for my career. I got my coveted promotion in my job but in exchange for that was heavier workload, presentations, meetings and new projects. I found myself spending more time traveling and less quality time with my family. Sometimes I wonder if the promotion is worthwhile and question if life is all about work. So what if we can climb to the top but neglect our loved ones, families and things we really wanted to do with our lives? Is life really all about bringing home the bacon and paying the housing loan?

During this short holiday break, I am glad to have some spare time to do some reading on career management. Basically I want to start 2014 brand new and don’t want to go through the same motion as in 2013, so I checked with Wiley whether they have any books on career management. To this, I was given the chance to do a book review on Fergus O’Connell’s The Power of Doing Less, a refreshing 135 pages book which you can probably finish reading in half a day.

As each year goes by, we find ourselves working harder and harder.  We spend more time at work, thinking about work, bringing work home with us.  Work now invades our personal life in a way that would have been unimaginable only a few years ago.  Remember when the media used to talk about having to ‘educate people for leisure’?  The very notion raises a bitter or incredulous laugh these days.  

In the last twenty years there has been an unbelievable increase in the volume of things people are having to do and the stress that people are under.  High levels of overload have become the norm.  Especially since the collapse
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How to become rich in Singapore

Many of us must be thinking hard on how to become rich in Singapore. Recently, there was an article in the local Chinese newspaper stating that an elderly man and his daughter illegally sublet their rental flat for $700. Apparently, they paid the government only $26 of rental fees every month since 1987 and had made a few hundred thousand of rental profits through the decades.
Even more amazing is that they were let off lightly by our government – barred from applying for HDB flats for the next 10 years and fined $5000. My wife and myself thought that the fine was peanuts considering the fact that father and daughter made a huge pile from the rental incomes. It seems that nowadays, Singaporeans are becoming more and more innovative to become rich, albeit through immoral methods.
Singapore finance blog
Gold buy-back schemes
Every now and then, when gold prices hit record highs and made the local headline news, there would be investors rushing to buy gold. To exploit clueless investors, a group of smart Singaporeans devised complex gold buy-back schemes, which operates like Ponzi scams. In such cases, gold is offered at a small ‘discount’ from their exorbitant prices. There is an option of buying back the gold at the full exorbitant price but the money used to buy back the gold must be derived from new recruits. Meanwhile, these new recruits buy the ‘discounted’ gold in the expectation of returns from selling it back to the company at a later date.
gold

In the news, a lawyer was interviewed and he pointed out that the contract agreement between buyer and seller clearly indicated that such schemes are high risk investments and that the returns are not guaranteed. So to be fair, people who chose to invest in such dubious schemes should play

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The Aftermath Effects of US QE Tapering

Merry Christmas to all readers! Below is a guest article from Gideon, a hedge fund manager for Blyton Fund. He is a global macro investor using similar strategies as George Soros. He search the world for the best profits with the lowest risks. He cover equities, foreign exchange, commodities and bonds across global markers. He is based in Singapore and is open to managing funds for others. Below is his article on US QE Tapering.

Incidental with the announcement by the US Fed on the upcoming tapering of the Quantitative Easing program, there are positive signs to buy into several equity markets and to long the US dollar against selected currencies.

The major equity markets will advance higher

I postulate that the equity markets of the United States, most of Western Europe, United Kingdom, Japan, Australia will likely advance higher.

Some would argue that no, they will crash because interest rates will rise.

My argument will be that yes, interest rate will risem but at a controlled and slow enough pace that will not hurt the economies. The respective governments will see to that because interest is at stake.Yes, it is true that when interest rate was almost zero, asset (stock) prices were inflated. With the recovery of underlying economies, the reason to justify the prices of equities will move from low interest rate to improving company earnings.

Further coupled with falling US bond prices (due to rising interest rates), the great rotation from bonds to equities have began.

http://blytonfund.blogspot.sg/2013/12/the-aftermath-effects-of-us-qe-tapering.html

Afternote:
The above article does not represent the views of SG Wealth Builder. Personally, I feel that the stock market is in the midst of a massive bubble and have divested all my stock holdings since last year. Currently, Dow Jones is at a record 16,300. This means that the

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The best time to buy gold

The best time to buy gold is not always so straight-forward.. No matter what assets you invested in, the only way to make money and become rich is to adopt a contrarian approach. Most investors understand the investment principle of “buy low and sell high” but when it comes to practice, most people will refrain from taking a position that opposes the majority. This trend is similar for any form of investments – property, equities, currencies and precious metals.

Currently the Wall Street’s Dow Jones is at a historic high of 16,200 points, recording a stock market bull run that stretched from 2009’s 6500 points. This represented an incredible 250% jump within 4 years for the United States’ stock market. A sensible investor would have refrained from investing in the stock market, given the bubbly state. Conversely, gold’s performance has been dismal this year.

According to BullionStar, gold prices have plunged more than 30% since the start of 2013. This puts gold in its first bear market after 12 consecutive bull market years. In my opinion, gold prices could slide further, reaching USD900 per ounce. On the surface, this may seem like an ominous news to gold investors, especially for those who had invested in paper gold, such as ETF and mining stocks. But if you are those who believe in bullion (gold bars and coins), this correction represents a golden opportunity to enter the market. This is because every market has their bull and bear runs, and it is perfectly normal to have major corrections of up to 80%.
gold bullion Singapore
Nobody can predict the future, so it is a question as to when the gold market will bottom out. But it should be noted that no asset with good fundamental will remain oversold forever. Just like equities, we should
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$3000 income is the new benchmark in Singapore?

Recently, both my wife and myself visited the new Bedok Mall developed by CapitaMalls Asia. We were quite impressed because it is the first full-fledged shopping mall in Bedok. The mall houses over 200 shops across three floors and net lettable area of 220,000 square feet, offering everyday essentials, lifestyle and fashion. The only major disappointment is the lack of cinema.

Anyway, back to the topic on income. We walked past EC House Express Cut and saw the job advertisement for a hairdresser. The advertisement stated the salary of $3000. It was not stated that the position required experienced applicants nor did it state for the preference of Singaporeans or foreign applicants. But I was quite surprised that a hairdresser in Singapore can command such high salary nowadays. After all, when I graduated in 2005, my starting salary was only $2600. So it seems to me that the salary gap between a skilled labor and white collar graduate is closing up rapidly in Singapore. The question now is: are Singapore workforce overpaid or is it a case of high inflation? In today’s context, can a degree really provide good income or open the door to opportunities?

I recall not too long ago, Sakae Sushi offered $3000 for a dishwasher. I am not too sure whether this offer is still open but it caused a lot of debate back then. On one end, the boss lamented the difficulty in filling that position because of the manual work and long hours. On the other end, many people questioned the wisdom of paying so much for an unskilled position. Both camp of debaters have their merits but I just wonder what is the salary baseline for Singapore employees nowadays. A check with the Ministry of Manpower (MOM) on median gross median income revealed

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Tapering QE is a sideshow and the road ahead is inflationary

In my interaction with local finance bloggers, I was surprised that many of them confessed that they didn’t know anything about gold bullion. In recent years, there were also a lot of negative reports of Singaporeans fallen prey to gold scams and frauds, losing millions of dollars in the process. With this in mind, SG Wealth Builder partners with BullionStar to educate Singaporean about the precious metal and the fundamental behind it. This article is extracted with permission from BullionStar, a Singapore online bullion company where you can buy gold and silver at competitive prices.

The word ‘taper’ has never gotten so much attention than in 2013 when it was used to describe the gradual tightening of the money printing spigot of the Quantitative Easing (QE) program. It started in March when the Federal Reserve said that they will reduce the QE bond purchases if economic indicators improve.

In April, a number of top Federal Reserve officials fed the media with more taper talk. St Louis Fed Bank president James Bullard said that he favoured “trimming” the QE program in $10-$15 billion increments if the economy improves. Then John Williams, president of the Federal Reserve Bank of San Francisco, said that if there was substantial improvement in the labour market, the Federal Reserve “could end the purchase program sometime late this year”. In May, it was the Federal Reserve Chairman Ben Bernanke’s turn to spread taper chatter by admitting that tapering QE could happen in the coming FOMC meetings if economic data warranted it. In June, Bernanke announced to reporters in a post-FOMC meeting press conference that the central bank expected QE tapering later in the year and end it some point in mid-2014. He gave the analogy of driving and that the Fed was merely lifting its foot off

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More HDB flats sold below valuation

According to an article by Property Guru, 105 HDB flats were sold below valuation in October. Based on HDB data, this trend is significantly down from the average monthly 0.3% for H1 2013 and reflected the number of flats sold below valuation increased four times in October compared to the first half of 2013. This phenomenon indicated a weakening demand caused by the “twin attacks” of stricter home loan rules and massive new flats construction programme announced by HDB in recent years. So should property investors press the panic items and run for their lives?

As written in my previous article, the cooling measure will not change market sentiment. Throughout history, the best form of cooling measure had always been a recession.

SG Wealth Builder
During recession, there would be widespread retrenchment by companies and it is only when people lost their jobs and lost money in stock investments, then they would be forced to sell their investment properties at cut throat prices. When this occurred, the market will correct itself and bring down property prices.

So I foresee that property prices will stabilize for the next two to three years, baring any form of recession taking place in Singapore. However, I don’t think that premium over valuation, commonly known as “cash over valuation (COV)” will enjoy its heady days. The average COV used to be $30,000 to $50,000 for five-room HDB flats, but nowadays, sellers might find it difficult to command such COV. This is because of the government’s measure to restrict new permanent resident from buying resale HDB flats within three years.

The most affected group of people could be those who speculate in private developments and up-graders who purchased private housing at the peak of the property cycle. This group of people took out massive home loans to

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Insurance

Insurance should always feature in every investor’s financial planning. In fact, before you even attempt to make any form of investment in equities or gold, make sure you are adequately covered, in terms of unforeseen hefty medical expenses.
Because of my late father’s health condition, I started buying life insurances and protect my wealth with enhanced hospital shield plan. I see it as a form of responsibility to my family because I don’t want to be a financial burden to them when I am old and ill. I also urged my friends and blog readers to buy insurance policies when they are young and healthy. This is important because if you procrastinate, chances are, the insurers will likely to reject your application if you are not in the best of your health.
Insurance
Lately, I chanced upon a fellow blogger, Lee Chin Wai’s article on his health condition and medical insurance. His article set me thinking whether I had really plan for the unexpected. In his article, he related how he has encountered unforeseen risk in his medical insurance. He had bought a private “as-charged” Medishield Plan B but did not buy any riders for deductible or co-insurance potions. In recent years, because of his poor health, he went to seek consultant at a private specialist and unwittingly “exposed him to the risk of being warded in a private hospital”. As such, his current medical coverage can only cover about half of his insurable medical expenses. He was thus caught in a situation whereby he might not be able to upgrade to a private shield plan, because this is subjected to the review of insurers.

While I had a similar shield plan as Lee Chin Wai, the difference is that I had bought riders to cover deductible and co-insurance. But

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Budgeting

When it comes to personal finance, budgeting is an important element. Yet I observed that many young Singaporean working adults fail to understand the importance of budgeting and how to practice it in an effective manner.

This is not surprising as most students were not taught about how to manage money in schools and at home, most parents also seldom discuss household budgets with their children. As Asian, we also find it taboo to talk about money issues during social meetings. All these factors reinforce the notion that budgeting is not relevant to successful personal finance, which is totally untrue.

Many people thought that budgeting is all about counting beans and tracking your daily expenses. But I beg to differ. Sure, there are means and various mobile apps designed to track your daily expenses but I find that managing personal finance at such micro-level would take the kick out of living a meaningful life.

silver

Just imaging this: having to think twice about buying or treating your good pal that cuppa of Starbuck coffee. Or how about skipping a close colleague just to save that ang pow money? Money is important but we should not let it rules our lives and stresses us out. Conversely, we must manage it to make our life meaningful. So a good budget is about managing your personal monthly cash-flow to ensure that your living expenses, savings, investment plans and retirement needs are catered for.

Separate bank accounts for savings and expenses
I have a few bank accounts to manage my budget. The expense account is the one in which my salary is credited to. Every month, fixed expenses such as car loan installments, parking fees, insurance premiums, handphone bills and utilities bills, income tax (I pay by installments) would be deducted from this account.

Pay

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