A Lifetime of Income for Retirement

Recent articles mentioned local survey results which suggested that an aged single could live off $1,379 per month. That works out to be $16,548 annually. A portfolio of $413,700 could generate that income perpetually based on 4% extraction (i.e. annual income needed x 25). But we need to understand that this is for a minimalist lifestyle for a single.

Referencing the last published Department of Statistics report on Household Spendings by Age Group, the average monthly household spending of those aged 50-59 was $4,837 (or $58,044 annually), and drops to $3,586 (or $43,032 annually) for those aged 60 and above.

But these were based on 2012-13 survey data. If we compound these with an estimated annual inflation of 1.5% (inflation has been low in recent years) for 6 years (from 2013 to 2019), the corresponding figures would be $63,468 (aged 50-59) and $47,053 (aged 60+) respectively.

Summary of data points:
For an annual spend of $16,548, perpetual income portfolio is $413,700.
For an annual spend of $58,044, perpetual income portfolio is $1,451,000.
For an annual spend of $43,032, perpetual income portfolio is $1,075,800.
For an annual spend of $63,468, perpetual income portfolio is $1,586,700.

For an annual spend of $47,053, perpetual income portfolio is $1,176,325.

So indeed a household spend of $120,000 annually would be quite a FAT FIRE to retire on. It should be pretty comfortable.
--

Somebody mentioned to me that assuming he retires at 65 and lives for another 25 years, he would need $3,000,000!  $120,000 x 25 = $3,000,000.  And if he was to retire earlier, he would need even more. So if he was to plan for 30 years, that would be $3,600,000!

I said no, that's not correct. Using the rule of 4%, he would only need $3,000,000 to generate a perpetual lifetime income of $120,000 annually.  $3,000,000 x 4% = $120,000.

And thanks to a little hack, all thanks to CPF, it's not even necessary to have $3,000,000 to generate $120,000 annually.

End of Life - Death Certificate

Sharing some nuggets with dealing with End of Life issues ...

Upon death, there is a need to obtain a Death Certificate.  Usually, if a person passes away at a Restructured Hospital, the Death Certificate is automatically issued.  But if a person passes away in a private hospital, then you need to bring the Cause of Death letter issued by the hospital to a Police Post to register for an official Death Certificate.

Other things required:
- NRIC of the reporting person
- NRIC of the person who has passed away

The Police Officer will punch out the NRIC to void it.  There is no fee involved.

And you could politely ask the Police Officer if he could make a few copies of the Death Certificate. Be nice!  You are going to need a couple of copies for the following purposes:

• Application from Town Council to book a space for the wake within the estate
• For family members who need the cert to apply compassionate leave

The original Death Certificate is needed if you are doing a HDB tenancy transfer.

Incidentally, the Death Certificate is also attached with a permit from NEA for cremation. This permit is needed by the Undertaker to apply for cremation services on your behalf.

Related:

NEA Post-Death Matters

Switched to Keppel Electric, Saved Some

The liberalization of the electricity supply market has thrown up a multitude of options for power suppliers and consumers. Each of the suppliers has tried to differentiate from the rest. So of course, that makes it really hard for consumers to figure out what works best for them.

I decided to go with Keppel Electric on their fixed price plan, betting on the assumption that prices will only keep going up. I mean, does it ever come down? Ever?

Got a bit confused with the billing system.  During the transition period, I continued to receive the ol' SingPower bills. These were for the rest of the services - e.g. gas and water. It took some getting used to Keppel Electric, and I thought they weren't billing me initially. I eventually realised that I was receiving the Keppel Electric bills. They had gone all 'digital' - strictly via electronic means. That took some getting used to as I am more used to checking my bills that come in the through snail mail.

Setting up payment was quite simple though. Their Internet application is basic and simple. It was straightforward to set up routine GIRO or Visa payment arrangements.

So am I getting any saving by switching?  My average utility bill (power, water and gas) was averaging $230 prior to this. Since switching (based on 3 months data), it looks like it's now averaging $200. So presumably the switch has resulted in $30 saving from the energy bill.

p/s: The energy bill is on the high side due to heavy use of aircon in this household.

What the fish? There goes Boardroom out the door!

What the fish.

Boardroom's parent company, G K Goh, through its Salacca vehicle, is carrying out a "voluntary unconditional cash offer". That's another good stock exiting.

Can you feel the increasing preponderance of the recent trend?

• Good company bought out and exits from SGX.
• Shitty company hitting rock bottom and suspended.

At this rate, all we will have left soon will only be the mediocre.

Sigh.

On the bright side, that's more spare cash with which to hunt another fish.

Phone Smashed in the Land of the Rising Sun

Wifey and I went to Japan for a couple of weeks, not too long ago. Hanami season and all that. Yeah. Nice. Really. Should go if you have not. Go, go, go.

Our last stop was back in Tokyo as we were flying out from Haneda to return home.

So there we were, on the last evening of our wonderful holiday, standing at that amazing crossing at Shibuya. Throngs of people, including dumbstruck tourists like us, adding to the bloody mass, er mess.

And of course, holding on to our mobile phone to take wonderful pictures for momento. [Who still use cameras these days?]

Then, all of a sudden (deja vu of primary school essays?), some random guy ran past us, bumping into my wife along the way. Shit. Literally, coz that's what wifey said.

Guy in suit. Looked like a local. He apologised. BUT DID NOT PICK UP THE PHONE THAT HAD GONE FLYING!  WTF.  Bloody hell.

On hindsight, I realised why you shouldn't pick up someone else's phone that you had caused to go flying.

The phone was all cracked up!! We were not laughing. Should have seen the look on wifey's face.  She was damn angry with me. She couldn't get angry with the random stranger mah, coz he had run away.  Haiz, time to replace her iPhone.

On a more positive note, we were reminded that we could claim damages from our travel insurance. Oh yes. Forgot all about it. And that's another story still waiting to unfold.

Quit Like a Millionaire, by Millennial Revolution

I'm quite a fan of Millennial Revolution and have been following them for awhile They are on FIRE! The couple (FIRECracker and Wanderer) hails from Canada and travels the world quite a bit.

While the circumstances of Canadian investment and personal finance options may be different, nonetheless, there are useful ideas that are useful and relevant.

I heard them on the radio once when I was in Australia. Or was it New Zealand? I can't remember. [Early signs of Alzheimer? *shrug*] It was so fun to hear them live. Bubbly interview.

They have just published a book that they have been working on, entitled "Quit Like a Millionaire". And it is at the pre-ordering stage.

So here's a shout out for them.  I am so getting a copy.

p/s: There are some freebies for pre-orders. Check out the instructions at their link above.

$3,000,000 for Retirement; How about $1,750,000 instead?

So there was an article in the papers a few weeks back that said a $3,000,000 portfolio is needed for retirement. That seems daunting. Scary. Seemingly beyond the possible.

I presume that magic number was derived based on a need to generate $120,000 per year for 4% extraction from the $3,000,000 portfolio.

But this can be reduced significantly for a Singaporean couple who can max out their CPF accounts. If both husband and wife (assuming of same age) can meet the Enhanced Retirement Sum ($250,000 to $275,000), they can collectively generate close to $50,000 per year from age 65 from CPF LIFE payouts (CPF LIFE Estimator).

That being the case, the investment portfolio will only need to generate the remaining shortfall of $70,000 per year. That means a portfolio of $1,750,000.  Seems far less daunting.

So all in, that is a combined investment portfolio of $1,750,000 investment portfolio, plus $250,000-$275,000 each in CPF-SA account.  More do-able?

For more info on CPF LIFE:  How much CPF LIFE payout will I receive?

p/s: Ok ok, so if you math it up, it should be $2,250,000 to $2,300,000 in terms of net asset value.

The Scary Situation of Being on a Denied Entity List

Effects of being placed onto a US Department of Commerce's Entity List are just beginning to filter through for Huawei and to consumers.

And looks like it has caused some level of panic for owners of Huawei mobile phones? The P30 30x zoom for the camera is great. But without all the apps that make the mobile phone great, who wants the phone? And in this scary digital world where bad guys abound, the apps need to be constantly patched to maintain cybersecurity. Software and hardware need to go together.

It also means that companies supplying to Huawei in whatever business nature cannot do so with any US-origin technology, be it hardware or software.  Companies that are not careful will soon find themselves in trouble if they inadvertently supply US technologies that ultimately end up in a Huawei product or services.

The long arm of US export control regime extends beyond their national boundary. You either live with it or suffer the consequences like Huawei.

Looking ahead, I doubt if the local telcos are going to continue selling Huawei mobile phones. And like the rolling effect of [bad] S-Chips, will it affect consumer preparedness to consider other China brand mobiles too?

Who benefits, and who loses in this situation?

Amazon Prime - The Scam (a.k.a. Electronic Bills are Evil 2)

I have to say it again: Electronic Bills are Evil.

My daughter is a Gen Y.  Gen Ys can't be bothered to check their bank accounts regularly. They snapchat, and everything is just a passing memory. Am I generalising or am I right?

Anyways, happened to check on a random day and realised that she has been charged since January 2019 for Amazon Prime membership fees. Yet apparently, she had terminated her membership since mid-2018.  Seems for the past three months, she has been billed GBP3.99 by Amazon.  That's randomly ~$7 a month. Sneaky. Scam?

The good thing is that she was able to the Amazon website and chat online with a service representative.  She was redirected to do so with Amazon UK via their UK website online chat as her account was from UK.

To Amazon's credit, they recognised there was an error and she has since been refunded.

Do you use Amazon Prime service?  Or have you been paying them even though you do not?  Check your kids' accounts!! 

We are living in a scary digital world.
[Wanted to say "virtual" but that's so passe; "digital" is all the rage these days.]

p/s: I gather Amazon Prime service itself is a pretty good service if you are seriously using it.

How Much Do We Need in Retirement?

When you start getting old (older), you start thinking about this kind of question. But really, should start thinking early. The trick is to start early. Very early. I've been thinking about this a lot more. And it's a pity I started late.

Anecdotally, it seems like a comfortable retirement lifestyle will require $3,000 per month.  That's a number I came across a couple of times.

Of course, if I'm going to live a retirement drinking only tap water, living on a remote isolated kampung on a distant island, and eating fish fished from the sea everyday cooked any number of ways, maybe I need a lot less. But that's not the kind of lifestyle I'm thinking of.

For a couple, that works out to $6,000.  And for each additional dependent, a.k.a. kid, that's $1,000 each. I've been tracking our expenses down to the last cent, and it is surprisingly accurate.

BTW, it is quite easy to keep track of expenses when all your spending either appear in your bank accounts or credit card bills. I use very little cash. That's the trick. Go SMART NATION!

So, for a family of four, that works out to $8,000 monthly, or $96,000 annually. Circa 2019.

DOES NOT INCLUDE EXPENSIVE HOLIDAYS OVERSEAS and other loan commitments (e.g. housing, car, etc).

Stacking on $24,000 for holiday expenses, that's $120,000 per year.  Those are numbers for my family at least. 

What works for you?

End of the Road for Travel Smart Rewards

So sad. I've been clocking points that get converted as cash rebate to top up my transportation card (see Insinc with the Times; subsequently changed to Travel Smart Rewards). Effectively discounted travel.

But I have just received this e-mail:

--

Dear Travel Smart Rewards user,

Thank you for your support of the Travel Smart Rewards (TSR) thus far.

The Land Transport Authority (LTA) has reviewed the Travel Smart Programme to take into account rail network enhancements in recent years and changes to commuter travel patterns. Following the review, we will be concluding the TSR programme. Please see http://bit.ly/2VWe2rt for more information.

Current TSR users can continue earning points for trips made on the rail network until 31 May 2019. They can convert their points into cash rewards, or use the points to win more points or cash rewards through the game on the TSR portal (The Ride One) until 25 June 2019. Points which are not used by 25 June 2019 will no longer be valid. For further information, please see https://www.travelsmartrewards.lta.gov.sg/faq

Once again, thank you for your support all these years, and we look forward to your active participation in other LTA schemes

Happy commuting!

Travel Smart Rewards Team

--

Long story short, no more. Boo hoo.

MOM Foreign Worker Tenant Enquiry - The Resident Who Isn't

Foreign worker with address tagged to your home? Scary. Worth checking out if there has been something fishy done.

Check it out:
Ministry of Manpower - Foreign Worker Tenant Enquiry

I'd absolutely HATE to have something like that happen to me.

I'm sure MOM will close whatever loophole that allowed such things to happen, presuming it did indeed happen and it wasn't some Fake News.

TPG, the upside

Facebook, Instagram, YouTube. There are plenty of bandwidth hungry apps that consume massive mobile data. It's pretty addictive. I guess it's a form of lifestyle inflation? Or is it a practical reality of digital norms, a sign of "progress"?

And so TPG (https://www.tpgmobile.sg/) appeared on the local scene, coming in as the 4th Telco. The net effect was that my Singtel shares went south, somewhat. Starhub is already struggling from their self-induced escalating impact of high dividend payout in the past. And M1 was taken private.

The saving grace is that TPG is offering a one year $0 plan as they aim to seize market share, even as they are gradually rolling out their network. Really, ZERO. Coverage is not great for now. But can't complain right? It is ZERO.

I signed up and got my hands on the TPG SIM. And voila, Samsung phones can take in two SIM cards! So I downgraded my current Telco plan (not ready to risk switching), and configured my mobile phone mobile data to feed off TPG's. Infinite data, infinite. To infinity and beyond! No need to hunt for a free Wifi and conserve usage. Yeah.

The trade offs? No coverage in underground buildings and MRT lines. Live with it.

Let's see what happens in a year's time. And hopefully I haven't become a bandwidth addict by then. Meantime, it's saving me cold hard cash every month.

ElderShield - A Severe Disability Insurance Scheme

Well, so as expected, and rightly so, CPF Board cannot release information of its member without being authorised by the member. [Dilemmas Dealing with End-of-Life]

But what CPF Board was able to accede to was to check if she is covered under ElderShield.  Must say CPF Board was responsive and helpful. 

So here's an extract of their response:

"ElderShield was first launched by the Ministry of Health in September 2002 as a severe disability insurance scheme which provides basic financial protection to those who need long-term care, especially in their old age. It provides a monthly cash pay-out of $400 for a maximum of 72 months to help pay out-of-pocket expenses for the care of a severely disabled person. The maximum entry age to be eligible for ElderShield cover is 64 years old.  Your mother was not covered under ElderShield since she was above 64 years old when it was launched." 

Unfortunately, it turned out that my mother was not covered.  Too old lah.  Oh well.  *shrug*

p/s: Are you covered?

Dilemmas Dealing with End-of-Life

It's complex enough building up a wealth portfolio towards financial independence. I think the end-of-life part gets equally complex and deserves attention.

Here's the scenario and I welcome any suggestions how to go about it ...

My 90-year old mother lives with two of my siblings. She has not been in the best of health in recent years. Most recently, she suffered yet another fall at home and was evacuated to A&E. While at the hospital, she suffered a stroke. She is now bedridden and totally unable to communicate, or do anything whatsoever on her own accord. 

Nobody in my family knows whether she is on ElderShield.  If she does have ElderShield, I am quite sure she would qualify for the payout.  She satisfies all the conditions.  But how can we go about checking if she has ElderShield?

[Else, any ElderShield insurance she may have is as good as useless?]

Nobody is aware if she had made a CPF nomination.  There is a general consensus that she did. But nobody has a clue who she nominated. Is there some way to check?  The thing is that I was entrusted with a sum of her money to take care of for her.  Her CPF Medisave Account is apparently depleted. So I thought, why not top up her account with some of this money so that there is ready cash to pay her mounting hospital bill.  And if unused, it would earn 4%+.  But then one of the siblings pointed out that if she should unfortunately pass away, the CPF balance would get distributed to whoever was nominated.  And this may be inconsistent with her Will (for which she did do one). Is there any way to check who she nominated?

[It led me to think. If my wife and I made CPF nominations, and we both knew what each did. But our children don't know. Should one of us have passed on and the other is bedridden, how will our children be able to deal with the situation?]

What can be done now?

10 Years @ 8.6% and a Year of Zero

So ends 2018, and with that, my 10th year of investing in the stock market. I guess 10 years can be seen as long term enough for investing?

For 2018, STI has been down -9.8% (not inclusive dividends). My portfolio has achieved -6.4%. Kind of oxymoron to use the word "achieved". After all, what is achievement here when it has been negative? Can I console myself that I over-performed the STI by 3.4%? Oh wait, but my dividend yield for the year happens to be precisely 3.4% too. That means I only matched the market? Nope, most definitely a C- year.

Compared against 10-year average out-performance of 5.6% (or 2.33% given average yield of 3.27% dividends), 2018 has been a drag on my 10-year outcome.

Overall, the 10-years internal rate of return achieved has been 8.6%.  Not too shabby, since my FIRE planning norms was based on 7%.

Against the backdrop of the recent downturn, what has been my reaction? Excitement! Yet another opportunity to pick up things on the cheap.

Happy New Year 2019!  Great health and good wealth.

Bit by Bit, the Coin that wasn't

So the euphoria of BitCoin and all variants of cryptocurrencies appear to be going the way of the dodo bird.

I must say it took a lot of conviction to resist from throwing some money into it when it looked like it was never going any way but up over the past two years.  Up, up and away.

But what kept me on the sidelines were those exponential graphs of its jet-thrust trajectory.  It reminded me of similar graphs of the Dot Com era, the S-Chips craze, etc. They always have the same consistent look.

All good things must come to a fiery end.

I hope those who threw good money at it did make some decent money somehow. If not, it's been an expensive jackpot game.

Meanwhile, I'm happy to learn how the Digital Ledger Technology actually works, code wise. Fascinatingly simple, to some extent - at least the basics of it.  Guess I'm a bit of a geek. 

When My Luggage Went Wandering

Wifey and I flew from Singapore to Belfast recently on British Airways, transiting through Heathrow Airport. It was a luxe trip as we decided to go with business class for the outward bound flight. We figured we could splurge and have a decent sleep on the way there, especially as we would be arriving in the morning and had to drive up from Belfast to our eventual destination.

It was a decent trip.

The British Airways lounge at Changi wasn't something to crow about. Decent, not too crowded, but limited food options (although decent tasting) and we felt, drab looking design. Could do better.

Service on the British Airways flight was much better. Great, first class even! But the business class layout is rather strange and I didn't particularly like that. Kind of exposed on the aisle. And the chap in the inner cubicle had to walk over my legs when I'm sleeping. Damn strange. The movies were kind of meh. I didn't particularly like their selection.

Heathrow is a strange airport. The aircraft arrived early (rare thing?), but ground crew was nowhere in sight! Sheesh. Took awhile for the aerobridge to connect for disembarkation. Too early, no service. 

Transiting, we boarded the connecting flight over to Belfast City Airport. It was a short flight. The airport is a very small one. Luggage started streaming out and were steadily collected. One, two, .... oh wait, where's our last piece!? *groan* It never appeared.

We went to the bored looking ground desk and sought help from the lady manning the desk. The lady was helpful. I guess she finally had things to do at this sleepy looking airport. Clickity click on her keyboard she went, but no go, nothing found. But she assured us, "We're very good at finding these things, don't worry. We'll send it over to your forwarding address." We thought we might never see it again. But that at least sounded reassuring.

And so the chase started, since we weren't staying put at one place, but moving from place to place. Nothing was heard till the following day. I received a message that our luggage had been found at Heathrow and it was being flown over later that evening to Belfast. But we weren't at Belfast anymore.  We were north of Belfast and travelling 3 hours south to Dublin. But not too bad, there was a website to update the forwarding address, which I promptly did.

It didn't arrive at my Dublin hotel that night. There was a message later that night indicating that our luggage had arrived at Belfast Airport and a freighting company would be shipping our luggage over the next morning.

On the evening of the 3rd day, our luggage eventually arrived at our Dublin hotel. It had finally caught up with us! Yeah.

Fortunately for us, we had packed our items more or less evenly split into two luggages. So we actually had most things needed to get by for the first few days. The inconveniences had not been too major.

The best part to all this was that it was claimable from our travel insurance. There was a sum claimable for every 6 hours of delay, up to a maximum of $1,200. The claim submission was straightforward as we had a good agent who helped process the paperwork, with everything done via e-mail. It helped that I have a printer-scanner to print the forms and to scan in after filling. It was hassle free, and the insurance company replied that it was being processed a few days later. A letter came a few more days letter saying it was approved with a cheque enclosed.

I'm glad we bought travel insurance as always. Peace of mind in case of emergencies. In this case, absolutely yeah! Guess we got a discount for this trip.

Don't forget to buy travel insurance for your next trip!

Age of Disruptions

Nothing lasts forever when change is a constant. Oh wait, that's a lot of cliche in one sentence. Overdose of it perhaps? Getting back to the subject ...

ComfortDelgro is being disrupted by the likes of Uber and Grab.

SPH's print media is being disrupted by digital media, even as it plays catch up while diversifying into retail malls and community care facilities.

SingPost snail mail is being disrupted by e-mail, while its eCommerce offers patchy slivers of opportunities.

Singtel is shifting from a pure play telco into a digital technology company.

It's hard for an incumbent business to adopt digital technology as it has to be accompanied by new business models. It's not just about bringing the traditional medium to a digital platform. The shift is hard.

Plus, there will be a lot of irrelevant work force that is ill suited for the digital age. Does the company stick to the past, or build for the future? With the workforce that is being displaced, what should it do? Should it listen to the heart or listen to the mind? Is there a place where both can coincide? There is too much at stake.

Will traditional consumer staples remain relevant? Can companies like QAF maintain its relevance in food if there is a changing pattern in food consumption? The fight against diabetes could have repercussions.

Will retail malls remain relevant with the increasing shift to eCommerce? Do consumers still shop?

Marine, oil and gas industries need no saying. While some may argue it's all about what Saudi Arabia chooses to do and that it's cyclical, long as it may lasts, perhaps it's also about disruptions from renewable energy?

Disruptions all over. Kodak moments, if you are even old enough to still remember Kodak.

Traditional Blue Chips start to look pretty blue ...

But it is in times of doubts and uncertainties that opportunities exist. Who will survive?

Multiple Streams of Income

A stocktake of income streams ...

At age 55, excess funds in CPF after deducting for CPF-RA (to fund CPF-Life)
From age 62, Supplementary Retirement Scheme
From age 65, CPF Life

And throughout, complemented by passive income streams from ...

Savings accounts - interests (<0.5%)
Money market funds - interests (0.5-2%)
Savings account with special/high yield - interests (1.5-2.5%)
Shares - dividends (3-4%)
Preference Shares - dividends (4-6%)
REITs - dividends (5-7%)
Bonds - coupons (4-6%)
P2P Loans - interests (12-25%; effective interest is lower due to defaults)
Blogging income - click-ads (pathetic)

Additional sources with constraints ...

CPF-OA - interests (2.5-3.5%; subject to policy changes)
CPF-SA/RA/MA - interests (4-5%; subject to policy changes)

Everything starts to look more interesting as age creeps towards 55.

No Taxis In Sight

You know taxi companies are in trouble when ...

- You land at Changi Airport and there's no taxi available to bring you home.
- You try the limousine/Maxicab service and it say no vehicles are available!
- When you eventually get into one, the driver seems to have difficulty breathing.
- The driver signals right and the signal remains 'right' all the way.
- You start thinking whether you should take over the wheel?

Uber and Grab have reshaped public transportation.
[Even if London has chosen to reject Uber.]

- My son decided not to meet us at the airport because surge rates had risen to more than $40 for the ride to the airport.

SMRT has already been taken private by Temasek Holdings. How about ComfortDelgro? Perhaps its relationship with VICOM will become reversed over time. Is that at all conceivable?

Speculating. Contemplating.

Losing Weight is an Expensive Affair - Or Not?

There's somehow this idea that to lose weight, one needs to eat "healthy food" and that costs more. That's a whole load of crap! Perpetrated by those who want to profit from the ill informed.

It's a matter of eating less (which is actually enough), coupled with exercise. Everything consumed should be in moderation. For the occasional binge, exercise more. A lot more. So if you're eating less, shouldn't it cost less?

There's is really no need for all the fads of specialty diets. No need for some miracle "weight loss" chemicals.

But I have heard of an interesting explanation from a friend though. He never could find the motivation to eat less, exercise more. Instead, he found it works when it hurts his pocket. So he signed onto a programme. Because he has to pay for it, he felt compelled to follow through. I guess that's one way.

I know of a relative who said she was dieting. She skipped rice and ate everything else in moderation. Yet, she was not losing any weight. I wondered why. Found out the reason. She didn't mentioned she binged on potato chips in between meals! Guess what? 20 chips is about 150 calories. That's 3,000 steps of walking to get rid of (roughly, 20 steps = 1 calories). It all adds up. Munch on a packet worth and that's probably the whole day's intact allowance! No wonder her so-called 'diet' wasn't working.

Check out "Basal Metabolic Rate" on the Internet. It's a good topic to start with. Simple maths. Or chemistry. Or biology. Depending on how you prefer to read it.

Was having a Classic Angus burger at Hungry Jacks in the Land of Oz (Burger King in Singapore), it's apparently close to 1,000 calories. And that's without even the fries and soda! Phew. That's half a day worth of intake for most people. The koalas have it good. They munch and sleep all day, get fat, and still look cute.

But I'm no koala. Time to go for a walk ...

Hitting Rock Bottom

Here's one advice in a recent article:

"... if the stock has hit rock bottom, but is set to rise aggressively, then it is better to just invest a lump sum to take advantage of the rise."

Oh right, that is so obvious. Surely.

But ...

How does one know that the stock has hit rock bottom? Only hindsight can tell.

How do you know that it is set to rise? That requires clairvoyance. God mode needed.

Conclusion: Got say like never say. Smart sounding piece of utterly useless advice.

Electronic Bills are Evil

I hate the move towards electronic records.  I get it. Save paper right? Save postage costs right? So everything in electronic form is good? And somebody decided to do automatic opt-in. Seems like a smart thing to do. Environmentally friendly and all that.

The thing is, when there is a printed copy mailed to me, I read. But when it's electronic, all I get is an e-mail notification. Then I have to go login, multi-factor authentication, clicking a whole bunch of menus, before I get to the electronic record. So I don't bother.

So recently, I finally realised that I have not been receiving my monthly credit bills because the records have gone electronic. And to my disgust, I realised that I was charged an annual fee without me realising.

Shitz. Shoot me. WTF.

An Ubery Experience - 3's a Crowd, and High End Uber

I've pretty much stopped taking the conventional taxis these days. Grouchy drivers, strange driving habits, uncertainty of flagging down any when I most need, smoky oxygen-deprived cab, #hotlikefxxxbutairconcantgetanycolder - just too many downsides to name. Nothing personal against honest drivers making a living. But really, I don't owe them a living. So if there is a cheaper and (to me anyway) a better alternative, I'm just going to switch camp.

Uber or Grab? Up to you. I've tried both, can't quite tell the difference in price. But Grab's UX sucks, compared to Uber. Simplicity is good.

Anyways, I'm cheapo. So I usually take UberPool. On lucky days, I end up travelling alone. Most days, I would be sharing with one other. Encounters ranged from complete indifference (ignore the stranger) to best buddies (as if we knew each other).

But this one day, there I was - the third party on the ride. 3 persons, 3 destinations. Geez, it was a looong ride. But a very cheap one. I was the last person in his drops. Took an hour. I might as well have taken the bus-and-train option for 1/6th the price. Sheesh.

On the last leg, I was comparing notes with the talkative Uber driver on Ubering in Singapore and in London. I mentioned about taking a Uber that was a Mercedes Benz in London. He told me there are Uber vehicles of high-end models in Singapore as well - Jaguar, BMW, etc. Huh? I was surprised, and have not encountered any so far here. Why would somebody who can afford such cars want to offer themselves for Uber services?

He said I will NEVER be able to get any. These are always driven by guys, and they hang around places like Clarke Quay on ladies' nights in the wee hours after midnight. They will only take bookings from ladies. Oh! 

Apparently, phone numbers do get exchanged, on occasions. Oh boy. It's an underworld. A different world. Are society norms evolving, or is it simply emergent behaviours from a complex adaptive system? Dunno. But I wish them well.

p/s: The way Uber and Grab is shaping the local scene, I can't quite figure out how Comfort Delgro is going to do well in the longer term. Disruption afoot. Perhaps another Xerox in the making. But for now, believe Uber is not even profitable. So judgement is still to be seen.

A Trip, a Fall, and a $115 Bill

My daughter is pretty enthu' about badminton. So in pursuit of her interest, she had joined her school badminton team. The twice a week night training span 3 hours each time. A typical session will see them doing all kinds of dexterity and stamina exercises before proceeding to skills training and practices. I think it's good for her. 

On one such occasion recently, they were jumping over shuttlecock casings serving as makeshift obstacles. I guess her dexterity was low that day. She mistimed her jump and tripped over the casing. It toppled, and rolled onto the side. She landed on it awkwardly. That was it. Accident. Injury.

Dear oh dear. Limp limp limp. 

As concerned parents, we sent her to the nearest hospital A&E. My guess was that it was nothing more than just a sprained ankle. But how to tell? Better safe than sorry.

2+ hours plodding through the hospital system of admission, triage, X-ray, seeing the doctor, getting bandaged, settling the bills and discharge, collect medicine, and LOTS (and I mean LOTS!) of waiting. Eventually done. 

Fortunately, nothing more than a common sprain. Of course, her ankle was looking like an elephant trunk by then. But, not too bad. Nothing broken, nothing more serious. Relief.

The bill? Apparently $200 for the A&E services, which seemed to be inclusive everything. But there was a $85 government subsidy. So the final bill was $115.

It so happens that one of the insurance policy I had previously bought for my daughter has an add-on component that covered any injury for medical claims up to $1,000 for each accident/injury. 

My insurance agent came over to collect the original receipt and took care of all the paperwork. I hope to see the cheque soon.

Guess I should put off terminating this policy. For now.

Paying $1 a Day to Reap Half a Million

My son has started his National Service (NS). As he charts his journey serving that nation, progressing from boyz-to-man, it's perhaps also timely to set him on the journey to manage his personal finances.

As a national serviceman, he is entitled to sign up for the MHA/MINDEF group insurance scheme with Aviva. It is really a steal. $500,000 term insurance coverage (inclusive disability benefits) is only ~$20 per month. Enrolling onto it was easy as he doesn't even need to do the extra work of medical check ups given his NS status. We added on another $100,000 of personal accident insurance, so there's some added cost for his coverage. Renewal seems to be annual. In fact, it seems like his spouse and children can sign on to the same plan too in the future.

I did something similar for my daughter, signing her up with AIA for $505,000 term insurance and total permanent disability, plus $150,000 critical illness. Works out to under $480 a year for a 30-year term. That will cover her till age 47. Don't ask me why the odd $5,000, but it was quoted as such. It was pretty hustle free too.

I made it clear to both of them that this term insurance will not benefit them directly. After all, the only returns to be collected is upon morbidity! Rather, it is to protect their 'dependents'. In the near term, that will be us, the parents. In the longer term, their own families when they are married. And if nothing is ever collected, it's a good thing!

The whole point of term insurance is to replace the lost income when one dies too early, and family members are dependent on you. So it suffices to cover till one reaches financial independence. Obviously, as one builds up his/her own investment portfolios, the amount of term insurance coverage needed decreases over time. So it probably makes sense to have multiple term insurance policies, each ending at different ages. Effectively, "reducing the coverage over time".

I figure that they may want to add on another $300,000 or more when they are older, and to have term coverage that will span them till their estimated retirement age. I don't know when that will be for them, perhaps 55, 62, 65? Who knows. I shall leave that to them to figure out when they are older. The term insurance is therefore to cover the gap till it can be met or surpassed by an investment portfolio to provide the desired income for the dependents.

But for now, they can be assured that they are duly covered for $0.5m each.

Next, time to terminate their existing whole life and investment-linked policies, and free up the cash to put to better use!

$Thousands Moved in a Minute

There is so much pent up demand to invest cash, even when the opportunities are basically short-term junk bonds.  Each time Moolahsense launches a peer-to-peer loan campaign at 2.30 pm on a "First Come, First Served" basis, the loans are fully subscribed within a minute.

My goodness, it has become a case of fastest finger wins!  A short pop by the toilet and I missed that window. What the shit, literally.  Want to lend money also difficult. Why do they launch these campaigns at 2.30 pm anyway?

What surprises me is that most recent campaigns have been in this format while offering a high of 18% interest. "Huat ah!"

I wonder why the companies do not seek the "auction" format where the interest is likely to be lowered due to competitive offers by lenders? Is this a sign of the extent of desperation for quick cash to tide over their business needs? These companies are probably in serious cashflow deficit situations.  Cash is king.

Of 21 loans I have participated in thus far, two have experienced late payments. Potentially, they could default. The business climate is difficult.

Most lenders put up between $1,000 to $3,000 per loan. The most extreme I have come across was $10,000.  So I guess most are taking the approach of spreading across many loans of small amounts. They are really junk bonds, so some defaults are to be expected.

As a lender, notwithstanding the defaults, it has remained profitable so far. Let's see how this keeps up.

Happy Rooster New Year! *squawk*

Health365 and Counting

So I've been trying to clock 5,000 to 10,000 steps per day to walk off the calories. The logic being that 5,000 steps is approximately 250 calories expended. Doing that 30 days a month equates to 7,500 calories, which is about 1 kg of weight. [More on this: Investing and dieting - wealth and health]

It's not too difficult to reach 5,000 steps a day really. Walk to the MRT on the way to work. Walk out for lunch and back (I know, weather might suck). And again from MRT to home at the end of the day. A little each way and it all adds up.

But reaching 10,000 is an altogether different challenge. It means deliberately walking from the office to the MRT station without taking the feeder bus. In terms of time, it takes only marginally a few minutes longer. So it's not really a hustle. But it is a hustle doing so in working attire with a load in my bag, especially the laptop. Back-breaking killer.

I guess it helps to fiddle with the phone, catching a few pokemons and swiping at pokestops along the way. A mild distraction.

Wouldn't it be great if one could make some money doing this as well? Actually, there is. Not much, just a little.

The Health Promotion Board (HPB) started another season of the National Step Challenge not too long ago. All I needed to do was to download the Health365 app from the AppStore, and sign up for the challenge. With the S-Health app on my phone that does the step counting, I only needed to run the Health365 on some days to sync the step count.

[There's an alternative option of getting a free step counting device (Fitbit-like or a watch type) from HPB.]

The steps are accumulated. So every step counts. There are several levels of rewards as certain step counts are reached. A few click on the Health365 app on the Rewards page and an NTUC voucher gets mailed to me a few weeks later.

Free money for doing nothing more than keeping up my health. Isn't it great? Stay healthy yah.

REIT on!

Owning a property can be a real pain, especially when you are still servicing a loan. Presuming it's rented out, then comes the pain of maintaining the property and dealing with the rent collection and such. There's also the income reporting and tax deductibles. Seems like quite a bit of work.

But there's an easier alternative of course. Outsource it! Let someone else manage it, and you are effectively engaging them to do it for you. Of course they take a cut, but you still get rental returns. With just one property, there's however no economy of scale. So the overheads involved can be high.

And then we have REITs. Effectively the same thing after all, but with the property manager handling multiple properties, collecting rents, while maintaining the properties. It's diversification.

I'm quite for REITs, particularly as they can serve to generate an income stream. It's not without risks though. There will be times when they raise funds from shareholders to fund some acquisitions. Each time they do so, they could very well be collecting whatever income they paid out!

And then, we now have the Phillip APAC Dividend Leaders REIT ETF. So we can own a slice of multiple REITs even! But I have some doubts if it's worth the while right now.

• With an estimated yield of 5% dividends, its 0.5% management fee would drive it down to ~4.5% yield. I would expect to get 5-7% yield on typical REITs. So getting below 5% seems like a letdown.
• Significant chunks of the REITs are non-Singapore based. While that offers country diversification, it comes with a foreign exchange risk.
• And finally, it is a dividend-weighted ETF. If I understand it right, that means high-yielding REITs dominate. My sense is that a high-yielding REIT is not necessarily a good thing. Examine the local REITs and you can see that those yielding above 7% tends to be the ones whose total returns are huge negatives!

For now, I will keep to buying individual local REITs that are backed by parents with the muscle to provide a pipeline of properties to feed them. Capitaland, Ascendas, Mapletree. There are enough choices.

Reaping property incomes without owning any single property nor servicing any loans. I like.