Importance of making your CPF nomination

Sign up for only $19.99! According to the Insolvency and Public Trustee Office (IPTO), as at 31 December 2020, the amount of unclaimed monies held at IPTO was $234 million, of which $150 million were unclaimed un-nominated CPF savings and $84 million were other unclaimed monies. The fact that there were $150 million of unclaimed un-nominated CPF savings means that there are still a number of Singaporeans who have yet to make their CPF nominations.

In 2017, I have made my CPF nomination. Subsequently in 2019, I changed my CPF nomination after an annual review with my spouse. Previously, I did not include my children in my CPF nomination. In doing so, we thought that this could be a risk in the event that both my spouse and I passed on at the same time. Thus, we made our way to the CPF office to change my CPF nomination. As usual, the process took only 5 minutes and the officer was very competent in answering our queries.

CPF nomination

The reason why I am sharing this article is because I hope Singaporeans can understand the implications of not making a CPF nomination. There are many myths and misconceptions of CPF monies out there and I have read many sad cases of Singaporeans being left in the lurch after the sole-breadwinners died without making any CPF nomination. Then there were court cases involving family fights over CPF monies. Very often, family harmony is destroyed due to ambiguity over money legacy.

BullionStarIn this article, I will pen down my thoughts on the importance of making CPF nomination. Take note that this is not a financial advice but just an opinion article to share my personal experience. If in doubt, please do seek advice from a certified financial planner.

Will versus CPF nomination

The biggest …

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Your company is a tool for building wealth: Learn how to achieve financial success

Building wealth and achieving financial freedom is a good way to increase the quality of your life. Money can’t buy happiness, but that doesn’t necessarily mean that materialism has a negative effect on overall well-being. Just think about it. When you have money, you derive satisfaction from other areas of your life, such as family life, health, social life, and so on. If you don’t lose sight of the things that matter, you can live a better life.

personal loans https://smarter.loans/personal-loans/

Image source: https://www.pexels.com/ro-ro/fotografie/aur-auriu-avere-bani-128867/

As a business owner, you could accumulate wealth or ramp up risk. You’re in the business to make a profit, so you should be enjoying the benefits of owning a successful company. How do you build a fortune? If you really want to know, keep on reading. In what follows, we’ll explore the best ways to achieve financial success and achieve your business objectives.

Don’t view your company as your job

Starting a company, especially a start-up, requires hard work and determination. The pay is low unless you’re one of the lucky ones who meet with success. To attain financial independence, you must think and act strategically. One of the biggest mistakes you can make is to treat your company as a job. Break outside of your role for a little bit and allow the business to run on its own. The results might just surprise you. The sooner you change your way of thinking the better.

If you approach the company as a job that helps you earn a little money, it won’t be anything more than that. You have to be fully committed to the business and give your all to drive success. Think about the company as part of your financial plan. How much time and capital should you invest? What is …

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Biggest myths about CPF Nomination

LIFETIME MEMBERSHIP The Chinese has a saying “You come to this world with nothing, and you shall leave this world with nothing.” Death is an inevitable phase of life which everyone would have to go through. While your CPF savings certainly belong to yours, the ownership would cease upon death. This is a fundamental universal truth. However, being a responsible wealth builder, I believe in forward planning. In this article, I will share my thoughts on the biggest myths about CPF nomination.

In 2017, I have made my CPF nomination. The process was incredibly simple and easy. It is also free of charge. I was very impressed by CPF Board’s efficiency and service standard. Within three days, I got a follow-up call from a CPF officer confirming my nomination details were in order and within a week, I got an official letter from CPF Board.

CPF nomination

Will versus CPF nomination

The biggest myth about CPF monies is that you can make a will on it. Many Singaporeans are not aware that CPF savings are not covered under will. According to CPF Board website, CPF savings are not part of your estate. The policy intent is to protect from creditor claims on any outstanding debts. This arrangement aims to “protect your CPF savings and ensures that your nominees receive your CPF savings expeditiously”. If you wanted your CPF savings to be distributed according to your wishes, then the only way is to make CPF nomination.

In the absence of a valid CPF nomination, your CPF savings would be transferred to another public agency called Public Trustee Office (PTO) upon your death. The biggest irony of all is that CPF nomination is free of charge.

When you are alive, making a CPF nomination does not cost a single cent at all.  Yes, …

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Will that fits the bill

By Lena Teng, CFP®, Acting Head of Solutions and Investment Lead, MoneyOwl

Amongst all the pillars of financial management, from savings to investments to retirement planning, will-writing is definitely the one that’s most misunderstood.

A will is a legal document through which a person declares how his/her assets will be distributed in the event of death. A simple internet search on ‘will-writing’ brings you to a long list of suggestions, of which a good number of them focus only on breaking down its misconceptions and common myths. The immense number of articles on this just goes to show that many are still unsure of this confusing and misunderstood aspect of financial planning.

BullionStar

This is a significant knowledge gap that needs to be addressed—as it contributes a big part to why will-writing remains to be a taboo topic amongst most in Singapore, with 56% of adult Singaporeans reporting that they have not made a will.
Will writing is not only crucial, but also a surprisingly simpler process compared to all other aspects of financial planning. The quick questionnaire below will help you unpack the seemingly mysterious concept of will-writing.

Question 1. Which of these is closest to the sum left unclaimed over the last 6 years by those who died without naming a beneficiary ?
a. $500,000
b. $1,000,000
c. $15,000,000
d. $200,000,000

Question 2. How long would writing a simple will online take?
a. 1 hour 30 minutes
b. 1 hour
c. 30 minutes
d. 15 minutes

Question 3. What is the cheapest rate to have a simple will written?
a. $1,000
b. $500
c. $100
d. Free

Question 4. Which of these are included in wills?
a. CPF, Assets
b. CPF, Assets, Liabilities
c. CPF, Assets, Liabilities, Beneficiaries
d. Assets, Liabilities, Beneficiaries

The correct answer for all 4 questions …

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Three important money advice from Jesus Christ

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In this article, I will share my insights on three important money advice. The story is written from the perspective of Christianity but I have adapted the story to re-frame it from the angle of wealth building. Note that I am not a Christian and this is definitely not an article meant to spread Christianity. Instead, I believe that readers can benefit very much from this sharing in the course of their financial journey.

In life, we will always receive money advice from well-meaning friends and relatives. Yet, very often, it is only those simple money advice that really withstand the test of time. As a matter of fact, the three money advice contained in this article served me rather well in my financial journey. Thus, I am sharing this article with readers.

money advice

The long journey

Once upon a time, there was a poor young man named David who just got married. The couple lived in a small farm. David wanted a better life for his wife and decided to venture out to find a better job. Before he left, he said to his wife,

“Dear, I will go and find a job that pays well so that both of us can have a better life. I am not sure how long I will be away but all I ask of you is to stay faithful and wait for my return.” The wife promised to do so.

And so, he left. David walked for many days until he met a farmer in need of help. The young man offered his services and was immediately given a job. However, David requested the following,

“Sir, I will work for you as long as possible but when I decided to return home, please do release me. In addition, …

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Dark side of Lasting Power of Attorney (LPA)

According to a Well-being of the Singapore Elderly (WiSE) study conducted by Institute of Mental Health (IMH), the number of dementia cases in Singapore is estimated to be about 82,000 in 2018. And this figure could rise to a staggering 100,000 in a few years’ time as our population aged rapidly. This is a frightening statistic and hence set the context for the need to consider making a lasting power of attorney (LPA).

Life is fragile and unpredictable. You do not know when disaster will strike you. In my previous article, I wrote about how my late Dad’s devastating stroke left my family in a state of limbo for many years. Thus, it is never too early to start planning ahead because you never know when adversity will strike. But if misfortune does strike, make sure you are ready.

LPA

Like all things in life, there is a dark side for lasting power of attorney. In 2014, the court case of Yang Yin cast the spotlight on the role of lasting power of attorney (LPA). In that saga, Singapore saw how this legal document can be abused if it falls into the wrong hands.

So, what is exactly a lasting power of attorney (LPA) and how does it impact your financial journey? In this article, I will examine the merits of making an LPA. But I must caution that this article is not meant to be a legal advice. If in doubt, please consult financial advisors or seek legal advice. The content here is written to the best of my research. If there is any factual inaccuracies, please feel free to let me know.

Deadline for LPA application fee waiver

Basically, a lasting power of attorney is a legal document that [This is a premium article. The rest of the

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Personal finance: 20 years of winter in Singapore

As an avid personal finance blogger in Singapore, I am passionate about personal finance and investment topics. My passion in personal finance stemmed from a challenging family financial background. So, it is definitely not by chance that I became a personal finance blogger. My goal for this blog is to share experiences relating to personal finance. In the process, I hope readers become better wealth builders.

Personal finance diary

The period 1994 to 2013 was the darkest chapter of my life, and also the longest winter for my family. We were very vulnerable then, and at the same time struggling to cope financially. My siblings and I were still schooling in secondary schools. Mom was a housewife and she received little education. Grandma was old and ailing. Dad was the sole breadwinner and his debilitating stroke plunged my family into an abyss of financial uncertainties.

I am a firm believer of working hard and smart to achieve success. In Singapore, regardless of social status and academic achievements, most Singaporeans should be able to earn good income if they are willing to work hard and smart. But what about those who are physically handicapped and struggling to make ends meet?

personal finance

For many people, the mere thought of removing urine for our fathers would have been grossly unpleasant. But for over three years, that’s what I did on a daily basis for my late father who suffered from the devastating stroke, followed by multi-system atrophy (MSA). Personally, it had been a humbling experience. I always told myself that Singapore certainly don’t owe me a living but I owe [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]

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Monetary Mindset: How to Think Like the Wealthy to Find Financial Freedom

financial freedom

Sure, the very wealthy are different than the rest of us — and in more ways than just the lavish lifestyles you see on television and tabloids. The rich also have a different mindset when it comes to handling and managing their finances.

You likely think the wealthy guard their wealth-building secrets closely. And to some degree, that’s true. But there are many ways you can emulate their fiscal practices to find your own way to financial freedom.

Work with Professionals

It’s a myth that financial advisers are only accessible by the wealthy. In fact, people with moderate incomes benefit more from expert advice than those who are already financially secure. For example, Singapore firms such as Asiaciti Trust serve private clients who want to make their money work for them, retire early and secure a solid financial future.

Working with the right financial advisor allows you to invest, save, and grow the money you have. Choose a firm that has years of dedicated service and proven results.

Embrace a Wealthy Mindset

To be sure, Singapore has many rich and famous people—and movies like “Crazy Rich Asians” can make it seem like a typical worker can never attain personal wealth. But that mindset can serve as a roadblock between a go-nowhere career and true growth.

Many extremely wealthy individuals believe financial security is a right and something they worked hard to achieve. Of course, some people inherited their wealth. But others began in situations similar to your own. Instead of thinking that financial security was out of reach, they took action and never looked back.

The simple truth is that if you do not believe you can become wealthy, you will not. Change the way you think about life, money and security. Become a positive thinker. Realize that if you …

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Changing my CPF nomination

A couple of weeks ago, I changed my CPF nomination after an annual review with my spouse. Previously, I did not include my children in my CPF nomination. In doing so, we thought that this could be a risk in the event that both my spouse and I passed on at the same time. Thus, we made our way to the CPF office to change my CPF nomination. As usual, the process took only 5 minutes and the officer was very competent in answering our queries.

So in my case, what is the difference between nominating and not nominating CPF monies to include our children? Are there any benefits in doing so? Previously, I have nominated my spouse to receive 100% of my CPF monies should I passed on. That is a pretty straight-forward situation. But in the scenario of us passing on at the same time, how would my young kids receive the monies? Even if they do manage to take out the CPF monies, being kids, they will definitely lack the financial judgement to handle the monies. With these in mind, we thought it is important to amend my CPF nomination to ensure that our children will not face financial difficulties in the event of our deaths.

CPF nomination

The reason why I am sharing this article is because I hope Singaporeans can understand the implications of not making CPF nomination. There are many myths and misconceptions of CPF monies out there and I have read many sad cases of Singaporeans being left in the lurch after the sole-breadwinners died without making any CPF nomination. Then there were court cases involving family fights over CPF monies. Very often, family harmony is destroyed due to ambiguity over money legacy.

In this article, I will pen down my thoughts on the rationale …

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Learn from Singapore government on how to use your CPF monies

The recent article by Dollar And Sense on how you can build one million dollar wealth using CPF by 65 certainly created a storm among netizens. While I do not dispute that this feat is definitely achievable, such an article does not paint a holistic picture and probably created plenty of false hopes to those who just started their financial journey. Let me share my insights in this article and how you should learn from Singapore government on how to use your CPF monies.

To put things into perspective, the author, Timothy Ho, is the founder of Dollar And Sense. Being an entrepreneur, it is unlikely that he contributes to his Ordinary Account. I may be wrong on this point and if so, I stand corrected. Therefore, when he encouraged readers not to use CPF monies to finance properties, he is probably speaking from his own experiences.

Okay fair enough, there are thousands of self-employees like Timothy who don’t have much CPF savings. Just think of taxi drivers, entrepreneurs and hawkers. But hey, the article was on how to build one million wealth with CPF right? Thus, what I am advocating now is managing your CPF monies to build a sustainable wealth.

CPF

Half-truth

In his article, Timothy claimed that there is a heavy opportunity cost when you use your OA to pay for your home because you “no longer earn the interest of 2.5% to 4% on the money”. Well this is only the half-truth because you actually still earn the interest of 2.5% to 4%. Yes, I am serious. You think you can get away with it by using CPF monies to finance your house? Not a chance. The CPF Board tracks every penny you take out from your CPF accounts. Everything is computerized and there is no …

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Top 5 Personal Finance Blog Articles

As the year draws to a close, it is timely to review how you have fared financially for 2017. Are your personal finances in order and did you grow your wealth? In this article, I will share my journey for the past one year and also the top 5 personal finance blog articles (in terms of traffic).

This year has been an exciting one for my family as we have finally moved into our new home. The motivation to upgrade from a 3-room HDB flat to an executive condominium was not purely a financial reason. Sure, the potential to “cash out” after the Minimum Occupation Period (MOP) is tempting. After all, ECs are sold at subsidized prices and home owners stand to make handsome profit after selling their homes. But the case for my family is different. We wanted our children to grow up in a better environment and forge a better future.

Due to the upgrade, I have done extensive research relating to home ownership, property taxes, home loans and financial matters relating to CPF. The analysis and strategies were subsequently shared in this blog. Many readers had feedback that they found the articles useful and insightful. Their comments had been heartening, so I have compiled the list to benefit those who may have missed out these gems. Now, I am ready to share these important articles which could be game-changing to your wealth journey.

Personal Finance Blog

To access the exclusive articles, you must register and be a member of SG Wealth Builder. There is a need for me to look after the welfare of paying members who have supported my blog and believe in this project. Therefore if you wanted to grow, come and be part of the community.

Rank #1: The thin fine line between “Joint Tenancy” and “Tenancy-in-Common”

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GST should be raised to 12%?

On 6 August 2015, the Ministry of Finance took a rare step in refuting claims “the Government planning to raise the GST after the next General Elections”. Singapore government slammed online websites for spreading baseless claims that the GST would be raised from 7%. Personal finance website, Dollar And Sense, also rubbished the notion that GST would be raised to 10% on 22 September 2015.

Well, they could be wrong as PM Lee Hsien Loong recently dropped big hint that there could be impending tax hike due to increased government spending.

In my perspective, I feel that there could be a grave need for the GST to be raised to 12%. Yes, it is 12%. Why so? Am I crazy? After all, it had been 10 years since GST had been raised from 5% to 7%. That GST hike had been perceived to inflate the cost of living and many people feel that the tax is regressive because the poor would be affected the most.

Before dismissing this article, it is important to look at the big picture and understand the macroeconomic dynamics. In doing so, Singaporeans can then better understand the insights of our leaders before jumping to conclusions.

GST

Great Financial Crisis

In the history of Singapore, the government had only drawdown our national reserves once. Yes, only once since we achieved independence in 1965 and that was during the height of the Great Financial Crisis in 2009. That was a chaotic period of time as major global financial institutions were on the brink of collapse.

Arising from this, there were concerns of a long and deep recession, prompting the government to announce that up to $150 billion of past reserves had been set aside to guarantee deposits in Singapore until the end of 2010.

However, …

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What will happen to your CPF monies upon death?

Recently, my colleague passed away unexpectedly, leaving behind two young daughters and wife. His wife is a full-time housewife. In grieving his death, I wondered whether my family would be able to cope if I suffered the same fate. Like my late colleague, both of us are sole breadwinners. So, I can imagine the family’s financial concerns and the fundamental questions on the destiny of CPF monies upon death.

Most often, there are misconceptions on the distribution of CPF monies upon death. There were even false rumours that Medisave savings go to the government after death as they are not included in CPF Nominations. In this article, I will attempt to explain the framework and try to gain a better understanding of the system. Again, I must put a disclaimer that this article is not meant to be a legal nor financial advice. In case of any doubts, please seek advice from licensed professionals.

Upon death, you would want your loved ones to have access to your CPF savings. This is especially so if the family’s financial situation is not so ideal. You don’t want your family to undergo financial hardship after you passed on. Ultimately, how you plan your estate will determine the outcome. For example, previously I wrote that CPF monies cannot be included in your Will as they do not form your estate.

In the following, I will explain the process of the distribution of your CPF monies. Basically, it really depends on the decisions you made before death. Most crucially, the situation is dictated by whether you have made a CPF nomination. Read carefully and think through carefully before making judgement.

CPF monies

With CPF nomination

If CPF nomination had been made, things are quite straight forward because the CPF monies will be distributed in accordance to the …

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CPF Nomination and Making a Will

The recent saga involving the will of the late founding father of Singapore, Lee Kuan Yew, has cast a spotlight on will. Of course, it is ridiculous to question the validity of Mr Lee Kuan Yew’s will as he was a trained lawyer. But most Singaporeans are not lawyers by profession. So, it is important to understand the legal framework to avoid the devastating outcome of making the wrong will. In this article, I will also share what is the outcome if you did not make a CPF nomination.

Basically, a will is a legal document that indicates the instructions on how you wish to distribute your assets after you passed on. Technically, everyone can craft his own will without the aid of legal advisors. Although this is the case, it is not advisable to do so because most of us are not familiar with the laws in Singapore. I have seen so many sad stories of legal disputes involving the challenges on the validity of wills. The biggest tragedies are often the broken ties and damaged family relationships.

CPf nomination

Before proceeding, I need to clarify that I am not a lawyer by training and this article is not meant to be a form of legal advice. I am writing this article to the best of my knowledge. If there are any mistakes on my research, please feel free to point out to me.

Should you make a will?

The question most often asked is whether is there a need to make a will in the first place. If so, what is the correct age to make a will? Under the Wills Act, only those who are 21 years and above can make a will. If you are not married, you are eligible to make a will. But note that the …

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Cancer in Singapore

Cancer. The mere mention of it strikes fear in many people. Yet most of us would never imagine ourselves being inflicted by this horrible illness in our lifetime. Recently, an ex-colleague of mine died from stomach cancer. His death caused a stir in the office because he was young (in the mid-thirties) and had everything going well for him. What is it like for a wealth builder to be struck by cancer in Singapore?

According to data released by Health Promotion Board (HPB), cancer is currently the leading cause of death in Singapore, accounting for 29.7% of deaths in 2015. In the investment community, ex-SGX CEO, Magnus Bocker died from cancer last month. Prior to that, founder of SharesInvestor.com, Dr Michael Leong lost his battle against colon cancer.

It seems like cancer is on the rise in Singapore. According to the HPB report, it was estimated that the lifetime risk for developing cancer in Singapore population is approximately 1 for every 4-5 people. This is not surprising as Singapore has an ageing population, so the number of people diagnosed with cancer is expected to rise.

Cancer in Singapore

In terms of statistic for cancer in Singapore, the number 1 cancer for males is colorectal (colon and rectal) while the number 1 cancer for females is breast.

Lifestyle habits and behavioural factors lead to the increasing trend of cancer in Singapore. As our country become wealthier over the decades, many of us become obese and live a sedentary lifestyle. In the pursuit of wealth, we tend to forget that “health is wealth”. Although it may sound cliché, if you think deeply, nothing in this world is more important than staying alive. You lose money in the stock market, you still get a chance to fight another day. But if you lose your health, it …

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Wealth destruction from CPF Accrued Interest

Your CPF savings can be your best friend. But it can also be your worst enemy if you don’t manage it well. For some unknown reasons, some readers attacked me in my previous article, claiming that I wrote “misleading” and “nonsense” information on the CPF Accrued Interest. They refused to believe that CPF Accrued Interest could lead to potential wealth destruction if the game is not played correctly.

First of all, CPF Accrued Interest is of course your money! I have never disputed that in my previous article and I don’t know why some readers tried to stir up negative emotions without getting their facts right. I read my article over and over again and verified that I did not write that CPF Accrued Interest is not our money.

But then again, so what if readers know that CPF Accrued Interest belongs to them? Of more useful to them should be the understanding of the mechanism of CPF Accrued Interest right? Not understanding the law can cost you an arm or leg. In this article, I am going to discuss how wealth can be destroyed if Singaporeans mismanaged their CPF monies.

CPF Accrued Interest

Fundamentally, CPF’s principle is that whatever amount of CPF savings you take out for housing or education purposes, you must [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]

Read my other articles on CPF:

  1. Devastating HDB Loan and CPF Accrued Interest
  2. CPF’s Home Protection Scheme (HPS)
  3. The Dark Side of CPF Housing Withdrawal Limit

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Devastating HDB Loan and CPF Accrued Interest

Be afraid. Be very afraid after reading this article. This is an article that all aspiring and existing home owners can ill-afford to miss. And I do mean it because you may live to regret for dismissing the message in this article. Today, I am going to share with readers the devastating effect of HDB Loan combined with CPF Accrued interest.

Many financial bloggers wrote about CPF accrued interest and HDB Loan. However, they may not have the real experience of purchasing an HDB flat or obtaining an HDB loan before. Most of them merely touched on the interest rate figures without providing much analysis on the bigger picture of the housing scheme framework in Singapore. In my perspective, this is dangerous as not knowing the full picture of the law can cost you an arm or leg.

However, I am different because in this article, I am going to provide some basic analysis and share with readers the frightening aspect of the HDB Loan and CPF Accrued interest. At the end of the day, I hope readers can avoid the financial pit-falls and grow wealth with me together. So, if you do find this article useful, please lend your support and subscribe to my blog.

HDB Loan

For many decades, Singapore government has been selling HDB Loan as a form of concessionary loan “exclusive” only to Singapore citizens. Undeniably, the interest rate for HDB Loan is extremely stable and is not subject to fluctuating market conditions. This is because the interest rate is pegged to the CPF Ordinary Account (OA) interest rate.

Currently, the interest rate for HDB Loan is pegged at 0.1% above the CPF OA interest rate of 2.5%. Hence, the total interest rate payable for HDB Loan has been 2.6% for many years.

CPF Accrued Interest

But in life, …

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Exemption from Home Protection Scheme (HPS)

One of my missions of starting this finance blog is to share with readers some useful tips on financial matters. In relation to one of my previous articles, a reader has raised a very good question on Home Protection Scheme (HPS). So today, I am going to share some information pertaining to how you can apply for exemption from HPS.

First of all, HPS is compulsory if you are using your CPF savings to pay your monthly housing loan installments on your HDB flat. Of course, there are some residents who are cash rich and do not use their CPF savings to pay their HDB mortgage payments. For this group of people, HPS is not compulsory.

But assuming you are using your CPF savings to service monthly HDB loan and would like to apply for exemption from HPS, then you may apply to CPF Board for exemption.

Most people thought that they should write to HDB when applying for exemption of HPS. The confusion is probably because when applying for coverage under HPS for HDB loan, you can apply for HPS cover at HDB Hub or any HDB branch office when you are applying to use your CPF for the monthly housing instalment.

HPS

But before you rush into applying for HPS exemption, there are some important things to consider carefully. After all, our home is one of the most important assets and a responsible wealth builder would ensure that their wealth is protected sensibly.

An important thing to note is that HPS is a mortgage reducing term insurance plan. What this means is that over the years, the sum assured, and not the premiums to be paid, would be reduced. And then there are the term life policy, which provides a fixed sum assured throughout the coverage period. Due to …

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Money values

The recent court case of a Singaporean technician who stole to finance his wife’s chemotherapy set me thinking. Money, or the lack of it, has always been the root cause of many family tragedies. This tragedy certainly reinforces the importance of having the right money values.

The accused worked as a technician in the same company for 23 years and drew a salary of $1210. Having to support two school going children and his ailing wife who was diagnosed with cancer, the technician was driven to desperation to steal copper wires from his employer.

Like many readers, I sympathize the plight of the accused and can fully empathize his situation because I have been through similar rough patch in life before. Thus, the objective of writing this article is to highlight the lessons we can learn from this tragedy.

silver

Dignity in poverty

First of all, being poor is not a sin. But the Chinese has a saying that goes “dignity in poverty”. It simply means that even if one is poor, one must have dignity and not let poverty erodes his values in life. Indeed, our money values define our legacy and whether you like it or not, stealing is a form of dishonest act and should not be condoned. We must not lower our moral standards just because of difficulties encountered in our lives.

When my late father was diagnosed with a massive stroke that caused him to be half-paralyzed, my family situation was even worse than the one that the accused is facing now. Being the sole-breadwinner, my father was unable to work because of his condition. He also had to support three school going children, my ailing grandmother and his wife. That was in 1993 and in those days, it was almost “mission impossible” to qualify for …

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Online frauds in Singapore

Recently, SG Budget Babe wrote a very interesting article on online frauds in Singapore and I thought it would be useful to share a quick post on the same topic.

But before that, it is important to note that like many fraud victims, I share the same perspective and argument if I am in their shoes. But for argument sake, this article shall attempt to strike a balanced viewpoint from the perspective of the service provider (the bank) and the consumer. Hopefully readers can benefit from this sharing and avoid the undesirable fate of being a fraud victim.

Understanding the law

In Singapore, the law that governs electronic transactions is the Electronic Transaction Act (ETA). This law covers two important components of online transactions – Electronic Signature and Secured Electronic Signature. For an electronic signature to be legally recognized, it needs to be able to authenticate the person signing the document and ensure integrity of the document signed. However, if the service provider implemented secured electronic signature, the law automatically presume that these requirements are fulfilled.

SG Wealth Builder

The 2-FA authentication used by many local banks is deemed as a form of secured electronic signature and the system works based on “what you know (PIN or password)” and “what you have (two factor authentication token)”. There are two types of tokens – hardware key-chain size token and SMS. The former generates One Time Passwords. Each time you log in, press the button on the hardware token to generate the One-Time Password. This will be displayed on the screen. An SMS containing your password will be sent to the mobile phone number registered with your bank whenever you log in with your user ID and PIN.

Hardware token is considered more secured than SMS because unless you lost your token, it is almost …

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Three things about growing wealth

This will be a short post to capture my thoughts about growing wealth in Singapore. In light of the recent Budget announcements, water prices will hike by 30% in two phases over two years. Thus, it is not matter of choice for Singaporeans to consider growing their wealth to beat the cost of living. All Singaporeans must start the journey as early as possible.

Stop tracking expenses

Early on in my wealth journey, I confess that I did track my monthly expenses and personal income religiously without fail. But I had stopped doing so after three years because I noticed there were no significant improvements in my personal cash-flow. Instead of enhancing my wealth, the quality of life inadvertently dropped as I suffered from guilt pangs whenever there were unexpected expenses incurred from friends’ outings or wedding dinner red packets.

After a while, I began to realize that my life should not be controlled by a spreadsheet. I need to be larger than life and start living a life. After all, we only live once. We are born into this world to enjoy, not suffer. With the change in mindset, I started to empower myself by focusing on how to grow wealth through enhancing my earning ability.

What happened next was beyond my comprehension. Like many people, I initially thought that my life would definitely spiral out of control once I stopped tracking my expenses. However, the opposite actually happened to me and to be honest, I struggled to explain what went so right for me in the following years. But I firmly believe that in tracking my expenses, my mindset prohibited me to become a better person in the sense that it encouraged me to be very risk averse.

sg wealth builder

Start tracking your income

Instead of tracking my expenses, I …

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Phone scams in Singapore

Times are bad and conmen are out in full force. Be aware of phone scams in Singapore. In a recent media report, a couple in Singapore lost $70,000 to a phone scam.

Apparently, the conmen posed as policemen and called the wife to inform that her credit card had been used for criminal activities in China. She was led into giving her online banking PIN number to facilitate investigation works. Subsequently, both husband and wife realized they had been conned and their savings had been wiped out within hours.

The speed at which the criminals stole their life savings left the couple in a state of shock. Within a day, they had lost everything and even had to borrow from friend for family expenses. Complete disaster.

One thing to note is that such a tragedy can happen to everyone. The common misconception is that only the elderly or less educated people are susceptible to falling prey to scams. This incident vindicated that when it comes to scams, everyone can be fooled. We must all stay vigilant and must never reveal our personal bank details and PIN number to anyone, not even to the authorities or enforcement officers.

For the young couple, this will be a painful lesson for them as they are likely to need the money to move into their new home. With a baby, they also need money for daily expenses. Thus, I can imagine how traumatized it would be to lose their entire savings.

For many wealth builders, it may not be a good idea to park all the cash in the bank accounts. This is because there is a likelihood of losing your entire savings to scams. With money on hand, you are also likely to spend it away. Thus, it is important to diversify our …

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My dream for fellow Singaporeans

As SG Wealth Builder, my dream is for fellow Singaporeans to have an equal opportunity to build wealth. That is why I chose this name for my blog. Even though I don’t work in the financial sector, through my articles, I hope that readers can gain valuable insights and learn from my investment mistakes.

Building wealth is a journey and requires a person to have a correct mindset. There are finance bloggers out there who wrote that more money cannot buy you happiness. I certainly don’t dispute this wisdom but then again, being poor in Singapore will certainly make you unhappy and miserable. If you belonged to the lower income bracket, it is understandable that you feel stressed out and insecure just trying to make a reasonable standard of living here. I have being through that phase in life and can certainly relate to this sort of feeling.

gold and silver

One thing that I must qualify is that I have not achieved financial freedom, nor am I trying to preach to readers on how to live a life. In fact, I am still a struggling middle-class income earner. But I feel that if Singaporeans can step out and share our investment or financial mistakes, collectively, we can become a better wealth builders.

In recent years, Singapore blogging community has witnessed the emergence of many investment bloggers. I am not sure whether this is a good phenomenon because many of these bloggers solely write about their stock portfolios. So I don’t see how they can value-add to readers and improve their investment knowledge. Nevertheless, there are a few investment bloggers who constantly share their analysis on stock selections, such as Investment Moats and Big Fat Purse.

I don’t often meet up with clients who are interested to partner with me because I …

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Are you a motivated wealth builder?

One of the worst nightmares of a salaried employee is being retrenched. This is especially so for mature workers in their forties and fifties. The prospect of losing your job at such career stage can not only be frightening, but also damaging to your financial health. In this regard, are you a motivated wealth builder?

Recently, a Singaporean called Mr Chua is still looking for work 6 months after losing his job. His experience is not unique in Singapore and can happen to anyone of us, given the competitive job market. To mitigate the damages arising from job retrenchment, we must always strive to be a motivated wealth builder.

One of the most common perceptions is that you must be good at managing your personal finances in order to be considered an effective wealth builder. To this end, I feel that ensuring employability and job longevity play an important role in our wealth journey as well. Most of us tend to place too much focus in our job and overlook the importance of enhancing new skills or knowledge with the aim of developing a second career in the later stage of our working lives. We are always too pre-occupied with our office work and tend to give less priority in upgrading our “individual software”. The wake-up call always came too late – when you are served the retrenchment notice.

For those mature job-seekers, this article may be of cold comfort to you but it is important to moderate salary expectations in order to remain employable. If you have been drawing $8000 to $10,000 monthly salary, there is a need to be realistic and accept a much lower salary ranges. Of course going back to square one is extremely painful because it means that the years of hard work have been …

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10 Easy Ways To Make Extra Money

Although money makes the world go round, you may find yourself in a spin by not having sufficient funds in your bank account. But if you struggle to make ends meet, feel as though your pay cheque doesn’t go far enough or simply want some extra cash to spend on life’s luxuries, then consider giving one or more of the following 10 easy money-making tips a try:

1. Forex trading

Short for foreign exchange, forex is the largest financial market in the world and allows anyone to take advantage of currency fluctuations caused by interest rates, inflation, government policy, and a wide range of other factors. It has fewer barriers than other forms of trading and is simple to get going.

 2. Online surveys

Research companies are always on the look out for members of the public to answer online surveys and test new products. This can be done while watching TV or before you go to bed at night and will result in either cold hard cash or another type of reward.

 3. Sell your holiday snaps

You don’t have to be a professional to sell photographs, as stock image agencies constantly need new and novel images of far-flung foreign destinations for their databases. Every time somebody buys one of your snaps, you will be given a royalty fee.

 4. Recycle old electrical items

 As opposed to the rigmarole of creating an auction listing or online classified ad, why not go down the hassle free route of a recycling site instead? Tell them what you have got and they will give you a price. Simple.

5.  Become a life model

Only certain personalities might have the courage to be a life model, but you don’t need the body of an Adonis to make money this way. Colleges and university …

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CPF: 3 ways to avoid spending your golden years in “survival mode”

In recent years, there have been many articles of old folks in Singapore living in poverty. This prompted Dr Alexandre Kalache, former head of ageing issues at the World Health Organization (WHO) to voice concerns that Singapore still has much room for improvement in terms of helping elderly to age with dignity.  Whilst I do not have the data to illustrate the profile and root causes leading to the plight of these people, at the back of my mind, I wonder to myself what it is like to spend my golden years in survival mode. Can CPF savings be your ticket to retirement?

Perhaps one of the most controversial topics among Singaporeans would be – Do you really need your CPF to retire? Is the CPF scheme still effective in addressing the retirement needs of Singaporeans? To tackle these questions, one needs to trace the history of CPF and its original intent.

Implemented in 1955, CPF is a compulsory savings scheme that requires all employers and employees to contribute a portion of the employee’s monthly gross salary to their CPF fund. In those days, most workers depend solely on their personal savings when they retire and most employers did not provide any form of retirement benefits to their employers. So the government deemed that a provident fund was necessary to ensure that Singaporean workers can support themselves in their retirement age.

Since then, CPF has undergone significant changes over the years with the introduction of the Special Account in 1977 and the Medisave Account in 1984, as well as the usage of CPF funds for investment and education purposes. You can even use your CPF Ordinary Account to buy property. The changes made to CPF are part of an evolution to cater to the growing aspirations and changing needs …

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Financial time bomb in Singapore households

Almost three-quarters of households in Singapore could face financial disaster in the future due to worrying levels of inertia around wills and life protection, a new survey by online matching service findaWEALTHMANAGER.com has revealed.

• 71% of affluent women in Singapore admit that they/their partner do not have an up-to-date will in place that reflects their current wishes
• Almost a further tenth simply do not know if this vital document has been kept up to date – this despite the fact that 38% of women say they take sole responsibility for financial decisions in their household
• Life insurance and income protection levels are also worryingly low, with just 60% of wealthy women confident that they/their partner have adequate provision in place
Almost three-quarters of households could face financial disaster in the future due to worrying levels of inertia around wills and life protection, a new survey by online matching service findaWEALTHMANAGER.com has revealed.

Currently, 71% affluent women in Singapore admit that they/their partner do not have an up-to-date will in place that reflects their present wishes, while a further 9% do not know if this vital document has been kept current.

Just as worryingly, almost a quarter (23%) of respondents report that they do not have adequate life and income protection insurance in place, with a further 17% not knowing if they have taken sufficient measures to ensure their family’s security.

These figures should not imply any lack of engagement in financial matters among affluent females, however. Today, 38% of affluent women in Singapore say they take sole responsibility for financial decisions in their household, while a further 47% making decisions jointly with their partner.

Just 16% of females cede decision-making on investment management and financial planning matters to their partner. The survey results seem rather to be …

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CPF Medisave Minimum Sum to be scrapped on 1 January 2016

Health Minister Gan Kim Yong announced in Parliament yesterday that the Medisave Minimum Sum will be scrapped next year January. For many Singaporeans who had been lamenting that their CPF monies “don’t really belong to them”, this is definitely a form of greater flexibility on the uses of their Medisave accounts. This is because when Singaporeans withdraw their CPF monies at age 55, they will no longer need to first top up their Medisave accounts to the MMS. Instead, they will only need to meet the withdrawal rules.

Another change would be the Medisave Maximum Ceiling, which would be fixed for each cohort of Singaporeans when they turn 65 years old. Mr Gan reiterated that the ceiling has to be raised every year to keep pace with rising inflation and increasing life expectancy. Given a choice, I would not touch my Medisave monies even if I am 55 years old now because the interest earned in Medisave account is so much higher than the current bank saving rates. However, going forward, the interest rate environment might change, so I really appreciate the scrapping of the Medisave Minimum Sum.

The revised Medisave rules is a sign that the government is beginning to soften its hardline approach on CPF monies. The previous approach involved a blanket rule that assume all Singaporeans can’t manage their personal finances and health-care costs in their retirement years. Henceforth, the need for minimum sum to prevent Singaporeans from using their Medisave before they reach retirement.

This development was in line with what PM Lee had announced a while ago – giving Singaporeans more flexibility in the use of CPF. Given our government’s conservative style, I think there would be more changes coming along for our CPF Ordinary and Special accounts. I am hoping for more good news!…

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SG Wealth Builder’s Journey

As we enter 2015 and bid 2014 farewell, many of us are making new year resolutions to improve on areas which we would like to improve in the coming year. SG Wealth Builder is certainly no exception.

There were several ups and downs for me last year but overall, I think 2014 had been pretty good for me. There were also some lessons learned in my life journey which I hope to pen down in this blog, so as to remind myself not to repeat the same mistake again.

Family

This year, there will be a new addition to my family! My second child is expected to arrive in late April this year. To welcome this bundle of joy, for the past few months, I had been busy making arrangements for his arrival. My wife and I initially were planning to hire a domestic helper because we fear that she may not be able to cope with my daughter and baby son.

However, after several months of discussion, we decided not to go for it because of the concern that the maid would create more headaches and issues for us to manage. We had heard and read so many horror stories of maids mishandling baby kids and children in Singapore. In view of this, we felt that it is better that we raise the two kids without the help of a maid, though we know that the going would be tough. Especially without the help of both my mom and mother-in-law.

Wealth Builder

As my job which requires me to travel frequently, I have sacrificed a lot of precious family bonding time. I missed my wife’s and daughter’s birthday celebrations due to business trips. Thankfully my wife had been pretty understanding and encouraging but we are not so sure that going forward, …

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How to start your investment journey

Hi SG Wealth Builder,

I am Ryan and I am currently still schooling. I have read your articles on your blog and I am very inspired by your investment journey. I would like to get advice from you on how to make my first step. I want to create an income source and at the same time, learn and gain experience in investing. As I don’t come from a very well to do family, I always face struggle when it comes to money issues, for instance school fees. I have saved up to about 1k plus dollars and would like to know how can I start learning and make my first move. Please give me advice.Thank you,
Ryan
I received the email from one of my readers a couple of weeks ago and made some editorial amendments to the original content. It took me quite a while to craft out this article due to my recent massive pay cut in my day job. I was in a really distraught mode and was not quite in the right frame of mind to blog.
Investment journey
Nevertheless, I felt obliged to response to this young man because I can relate to his motivation to invest. Like him, my family struggled with money issues all the time when I was a young boy. So now that I have a better life, I hope to  mentor young Singaporeans and share some good personal finance practices. One of the key reasons for starting this blog is also to make a difference in other lives and guide young Singaporeans on the right path in managing their money.
I started to dabble in stocks when I was 17 years old. In Singapore, before you can start trading, you will need two accounts: a securities account with The Central
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