Money Management

We are not really taught on how to manage our money in school when young, at least for me. We only listen to stories that teach us not to waste money or to spend our money wisely but exactly how to manage our money well is not shared with us.

I feel that it is important for everyone to have such knowledge before we start to work. For me when I graduated, such term as money management does not even cross my mind. I only know that I need to save money, how much is sufficient I also don't know or can't be bothered. How I spend my income then was a portion for my parents, then some for paying bills and then only towards the end of the month, whatever balance left will be my saving. And yes, most of the time, nothing was left. It got worst after getting my first few credit cards, I lost track of my spending and in some months, outgoing was higher than incoming.

Still happening to me sometime as I cap my monthly spending

Picture Credit: http://www.factum.lt/

Of coz with some reading up of such knowledge on internet, one should know not to live in such way. We should set aside the saving first even before we spend; spend what is left after saving and not save what is left after spending, a common advice that you will come across. But I don't remember anyone sharing this simple logic with me before. Maybe the schools should start educating student on this matter, or it is already in place now? I  think this matter does not really cross many student minds during their school days. I am luckily that I don't really worried about money then. Thinking back, I should have even manage my allowance better during my school days!

Teach them young!

Picture Credit: http://www.thedigeratilife.com/blog/

I am happy to read some blogs that are written by younger one that share how they start their investing early in their life. Below are two examples that I have been following for quite sometime:

http://teenageinvesting.blogspot.sg/

http://sgyounginvestment.blogspot.sg/

Everyone should spend some time reading up on money management, there are many useful materials on the net for us to refer to. Learn to manage it well. Money is not the most important but it is essential. Be content with what we have too although it doesn't mean we should stop aiming for higher living standard, just that we shouldn't go and enjoy the lifestyle that we want before we can even afford it. Looking at how some younger working adults that I got to know, spend their money on the stuff, I am worried for them when I get to know more about their background; clearly some are spending beyond their mean or thinking that their monthly income will never be cut off, a dangerous thought. One should never assume their job is secured even if it appears so. Even now, sometime I can be broke and waiting for my next pay check but that's because I have force myself not to touch my saving at all. Money put aside as saving or investment to me is like money gone, can't spend on other stuff.

Well, that's me. Everyone is different, so one should find a way of managing their money well that he or she is comfortable with. Don't take things for granted.

Picture Credit: http://www.triua.com/108/10-important-tips-for-money-management.html

Min S$50 Withdrawal POSB ATM Disappearing?

Did you notice that those POSB ATM that used to only disperse S$50 notes are disappearing? Recently I notice at least 2 known such ATM having the sign removed, allowing us to withdraw S$10 notes too. It's a good move, POSB!

Picture credit: https://twitter.com/kennyhwx/status/484311713588584448

Previously there are quite a number of complaints on this restriction; to me it is not really a problem but I do like to withdraw S$40 instead of S$50 as I like to have S$10 notes which is more user friendly. You will not get black face from stall owners when you try to pay for a S$1.20 popiah with a S$50 note for an example.

Google results show that this was already in place for some ATM since 2 years back:

http://www.asiaone.com/print/News/Latest%2BNews/Singapore/Story/A1Story20120413-339606.html

Sometimes I find it weird that such S$50 notes only ATM is located at heartland areas, just like the one I went to moment ago; it is beside a NTUC in a small HDB neighbourhood shop houses area. I do not think there are many people who would withdraw large amount of money from this ATM at this location. Can't remember when it was converted but the queue was long before that and after having this restriction in place, the queue was gone; something good for those who hate queuing but inconvenient for me sometime when I need to withdraw money to buy stuff at that area but face the problem of having only a S$50 note and using it to pay for items less than S$5, paiseh for passing the inconvenience to others.

Glad that POSB is taking note of the feedback from the public and remove this restriction for those few ATM I saw. Not sure if they did any update to customers about this change as I feel that they should do it which will be a good publicity for them, showing that they value customers' feedback. I find that in Singapore, we tend not to admit that sometimes we are wrong and we revert back after that. We will find some other excuses to explain for the reverting action instead of just simply admit that what we did is not as good as what we thought, maybe face is more important?

Did You Enter the Market?

The SG stock market was down quite a bit last week. Stocks that I purchased few days were cheaper then, quite sad looking at it, haha but it only bother me for that few seconds when I login to my account. One should always remember, you won't know when is the lowest point in the price trend, you can never really guess it.

To me, as long as the price is right, I will just enter the market. Since I am holding to the stock for longer term, I should not be worried too much about the short term trend. Usually I look at longer trend, minimum 6 months to maybe maximum of 3 years. Who don't like to buy lowest and sell highest, right? 

If the price keep going down, I will just hold on, it will just be paper loss for that moment. As long as you don't sell it, no loss, until you really need the money, then it is another story. Hence, one must always use the money that is spare, i.e. you foresee that you won't need to use the money for at least 3 years or more.

Of course nothing is guarantee safe, we still have to cut loss if necessary. Sometime really no point holding on to false hope, just have to cut it off and put your money into other better options. You may be right or wrong, but there are always many other opportunities out there for you, why so stubborn and keep insisting that you can't be wrong?

Well, it is easier to say then to execute it. Emotion is the most difficult thing to handle in trading. One has to learn to handle it well, really well, it takes experiences I think, at least for my case. I have to learn not to be affected by the price movement, it is hard but we just have to overcome it, it's part of the game. One day the price goes up, you feel rich looking at the positive percentage, feeling smart and just want to kiss yourself for a job well done. But the next day, the figure turns opposite way and red number appears. You feel like the whole world is against you, you hate them so you just cut the loss and close the position. And you know what? Immediately when you close it, the market turn right up and bull charge like nobody business! And you can only watch the price goes up and up leaving you behind, haha, you start to ask yourself, why me!

I know that feeling...

Why me!

Picture credit: http://www.rediff.com/

That's what happened to me last time, mainly because I was playing with money that I can't really afford to lose. Hence the pressure is there when I see red figures, pressure to cut loss, pressure to take profit early, too early in many cases, fearing that the profit will be gone again like in many previous cases. Therefore, loss is big while profit is small, net net huge negative figures.

I still look to trade some stocks on short term basis but has a plan in place before I even enter a buy price for it, plan as in what price to enter, when to exit for either a profit or loss, whichever the direction the price goes to. With a plan already in place, it helps to keep my emotional in check. I just have to stick to my plan no matter what, to a stage whereby sometimes I even don't bother to check the price on regularly basis. Currently I tried to login to my account daily to keep myself updated but sometimes I was really busy with my other stuff. There was once that I was busy for few days and I only remembered that I still have a trade pending till I received an email notification that it was closed, and closed with a profit, make my day!

Anyway I am not going to depend on trading to make my millions, something that I thought I could many years back, it looks like easy money then. I think by putting a bit more effort in my job, the return is so much better, haha. Without the proper knowledge plus that fact that I am lazy to go read up myself to gain additional knowledge or skills, I think I will just keep it simple; buy and hold stocks for dividends or sell them if the price has reach a target that I think is time to let go. It will be like a saving but with a higher interest rate than normal saving account, unless we get to see fixed deposit interest of 5% again like in many donkey years back.

So I shall continue to ensure my monthly pay goes up, save large portion of it because you never know when the monthly pay will stop, put the saving into normal saving account, fixed deposit and build up my stock portfolio etc. Also if the property price is right in the future, may consider getting another one to get rental income, another way to get passive income. Always be prepared for the worst and always be prepared to downgrade if necessary, don't hold on to it if it starts to get beyond our means. Remember we can't bring everything with us when we reach our expiry date. Enjoy while we can!

Picture credit: http://www.theglobalbutterfly.com/passive-income/

Newcomers To My Stocks Portfolio

Added 3 more stocks to my portfolio as their prices reached my target buy price; Cambridge, ST Engineering & Sheng Siong from my watch list.

Stock	Lots	% of Portfolio
OCBC Bank	1	31.53%
Starhub	1	13.22%
ST Engineering	1	11.72%
Cambridge Industrial Trust	5	11.50%
Singtel	1	11.49%
Sheng Siong	5	10.53%
SATS	1	10.02%

Total invested capital is S$30,640.

The additional fund directed to my stocks portfolio will be from my fixed deposit that will be matured in 2-3 weeks time; a 6-month SGD Fixed Deposit of S$10,000 (maximum) with POSB at 1.38% p.a. (Fixed Deposit 2014 Labour Day Promotion), better than leaving the money in my saving account. So fast the 6 months period is ending, what have you done during this period?

Addiction

Watching my pool of money grows is addictive for me. Making me less willing to buy stuff to pamper myself. Now, whenever I have the thought of buying something that will cost few hundreds or more, I will ask myself if it is necessary, worth it or not, any other alternatives etc. That's not me in the past where I will spend quite a bit of money just to have something nice or may make myself happy for that moment. It even made me go to extreme of buying stuff using instalment, i.e. using future money. Hence I didn't have much cash on hand then, all spent on somehow unnecessary stuff. Some stuff was even sold off after few months and I still need to continue to pay the remaining instalment!

Can't remember exactly what makes me change in term of managing my money but I am lucky to wake up and realise my poor money management. Now I just love to track where my money goes to, down to every cent. I do have an excel spreadsheet to keep track of everything, knowing exactly when and how I save or spend my money. Nice to have this feeling of having them in my control, unlike in the past, don't even know why I always end up with little or no money towards the end of each month.

Having said that, it doesn't mean I am stingy with myself or even with others, making life boring or miserable. At times, I still treat myself or even friends a nice meal etc. Sometimes it is a joy too when spending money wisely, especially with your love ones, the happiness, the special moments, nothing beats that. Most important is to be happy and not be miserable just to save more money. After all, we can't bring our money together with us when we reach our expiry date in life. Enjoy what we have while we last, life is short, just a number of decades and that's it. So let's be thrifty but not stingy.

My Humble Start To Stocks Keeping

Since beginning of this year, I have begin to start tracking, buying and keeping stocks to have a better returns on my saving than just putting my money with the banks. Have been lazy in taking this first step which I think most of us should learn and do it as early as possible. Even starting this blog with its first posting also took me few weeks!

Going to use this blog to track my humble start in this journey and also to show others that it is never too late to learn to manage our money better. But well, who knows how far this blog can go, right? And who knows how far my plan can progress too. Laziness is both my weak and strong point. Have been putting aside many plans that I want to carry out but being lazy also help to make me 'think out of the box' in my work place as I will always think and look for ways to complete my tasks in the shortest time, with least effort and with best outcome.

I'm trained in engineering field, so forgive me for my poor command of English, I'm weak in languages. Whatever thinking or analysis that I have applied in my trading is all self taught, in some ways I have learn it in a hard way in term the losses I had, haha, who don't? I have learn to keep it simple since then, managed to make some money but find it too time consuming, laziness kicks in you see. One just can't understand why I would be lazy over money! No wonder I am still a poor man. Therefore keeping stocks for long term gains, like collecting the dividends, should be simple enough for me I think. 

Currently my stock portfolio only has 4 stocks with 1 lot each, a small start for me.

Stock	Lots	% of Portfolio
OCBC	1	47.59%
Starhub	1	19.95%
Singtel	1	17.34%
SATS	1	15.12%

Total invested capital is S$20,300.

So why these 4 stocks? OCBC is my current primary saving account due to its promotion interest rate of 3.05% now and it is the cheapest bank stocks out of Singapore big 3 banks. Starhub & Singtel are stocks that I have been trading in the past and I have decided to hold them due to good dividends paid out. As for SATS, I bought it in view of the Changi Airport expansion which they may get to be the service provider for the new terminals in the future. Of coz I do consider the past dividends paid out records too.

Some stocks are in my watch list, to be added to my portfolio when the price is right for me. I'm slowly moving some of my fund from other sources for building up my stocks portfolio. Will update my blog monthly or as and when there is any new stocks being added. I think I will also share anything that I find interesting or useful that is worth sharing.