Want Something? Do Something!

We are all creatures of comfort, we love to dream and talk about having this and achieving that. We all know that talk is easy, talk is cheap but we stick to it without any form of action anyway. How many times have we seen someone else selling an idea we had years ago but did not put in the effort to get off our butts to kick start something?

Why is it that we do not always have enough drive to get something started? Majority of us would cite reasons such as:

• It might not even work or sell.
• What if I fail?
• I do not know how to do this?
• How do i even start?
• What if no one supports my idea and people start laughing at me?

From what I see, it boils down to 2 main issues, fear and laziness. Sometimes, we just need to want it bad enough or be pushed to the edge to give ourselves no choice but to bite the bullet and jump in. Would you want to put in the effort and take the risk of starting your own company if you are currently having a secure job with a comfortable salary?

How about if you just found out that your current employment company was going to fold soon? Would you be pushed to take the leap and start your own because you have nothing to lose? ( Just an example )

What I'm trying to say is that, if you do not have that drive to get something done, you have 2 choices.  The first is to find a partner who is action oriented. Someone who will get the ball rolling and push you along as well. The other is to develop a mindset that to start that something is what you really NEED and have no choice but to push yourself off the edge.

Whatever the method and whatever the reason, the most important part of anything is the 1st step. Without it, no one is going to get anywhere. It relates to everything from your new start up, your savings plan or even getting the leaky faucet fixed.

 Get something that you have been procrastinating on done today, take the 1st step, no matter how small and get the avalanche flowing.

As always, save more, spend less and invest wisely.
P.

Difficult to Retire Early in Singapore - If you are A dude.

During the week, I happened upon a forum post on an Early Retirement Extreme site. The topic starter was a Singaporean man who is searching for ways to achieve early retirement in Singapore but has yet to do so. What caught my attention was a reply from someone is Australia who has stayed in Singapore for a period of time.

He said some things which caused me to ponder upon some of my decisions, although i will try not to be wavered in my decision - My life my rules..cant rem which advert was that from. Anyway, he said that its difficult for the male gender to retire EXTREMELY early in Singapore due to several reason. Here they are(taken directly from forum):

• Patriarchal society. If you are a man - not working is just not the done thing.
• Very consumer driven. Singapore is wealthy and people live well, dress well and drive nice cars. There is also a distinct lake of 'Bohemia' and weirdness which makes being different frowned upon. This is a country that has laws for everything. You cannot chew gum and if you do not flush the toilet in a public place and caught you are fined.
• The other issue is this idea / cultural thing that one must look after the sons parents in old age. Lots of pressure on the sons to keep working and prosper.

 How do you feel about the points that he has brought up? I feel that they are extremely valid. I do not really care much about the first and second point as I do not really care what outsiders judge me and I do not really covet what other people have. However, I realized that I have neglected to account for point 3. I have accounted for monthly allowance for when they stop working but have not done so for the later stages of their lives. Costs such as their hospitalization, their insurance or even their holidays.

So far, My plans only include my immediate family consisting of me, my wife and my future children. This once proves that plans are ever changing and we as humans must adapt. I know have to re-strategize to include all these costs which I have missed out. We learn everyday do we not?

Is there anything you have missed out on?

As always, save more, spend less and invest wisely.
P.

Just.One.More.Dollar

Dear readers, somewhere along the way, roughly in the past 2 years, I have come to realize something. Sometimes, the extra dollar saved is not worth the sacrifice you have to make. Yes, I know that every dollar counts but there must also be a limit to how much we can compromise our lifestyle and the lifestyle of those around you.

After achieving your set target for the month, saving those extra dollars will not bring forward the earlier retirement date by much. I would say at most a year or two.  Now let me ask you this, would it be worth it to sacrifice for the next 20 years or so just so that you can retire that one or two years earlier? I say no. I do not want to compromise my current lifestyle too much for that. You must know when enough is enough.

What I think we should do is to create a smooth path, one that we enjoy all the way till the end. In moderation of course, and not one where we have to suffer first and enjoy later. In everything we do, we have to think about the people around us, our spouse, our children or our parents. It does not mean that if you do not mind the suffering, they won't mind it as well. They might be appearing to do so just because they do not wish to let you feel disappointed. Spare a thought for them, and if you can afford it, spend those extra dollars to make their day brighter and happier.

I guess this will be a short post. Got so many things to do, so little time.

Anyway, I hope we will not be so overly obsessed with savings that we forget the reason to which we are saving or neglect our loved ones.

As always, save more, spend less and invest wisely.
P.

When Was The Last Time You Felt Happy?

Dear readers, what is the first thing that comes to mind when you think of the words happy and satisfied? Take a few moments to think about it. I'm pretty sure that many things come to mind, but there is something missing in most of the images and you cannot put a finger to it. Could it be that in most of those things do not bring about true happiness and satisfaction?

Now, narrow those thoughts down to just experiences with friends and family, take away material purchases. Think upon for example, finally getting on the plane to for your honeymoon, gazing into the eyes of your better half, when your child was born or when you were on that beautiful beach with your friends, Malibu Orange in one hand, a cigar in the other. What do you feel now? If you are like me, you will sense that longing in your heart to feel that feeling again, you will feel that at that moment, you were truly happy and satisfied. No? er... maybe you have different priorities and needs in life. For me, these are the kind of moments that I truly treasure and savor.

What I'm trying to say in this post is what many other bloggers have said before, I just want to add a more mental picture so you can feel what I'm trying to say. Most things that you buy, say hand phones, new clothes, new car, new laptops and all other consumer products will only bring about a very short lived happiness. After a while, you wont even remember that tiny spike in happiness that occurred when you made that purchase. If that is the case, why not invest your money on providing yourselves and your loved ones with experiences instead?

Experiences don't have to cost a lot, but even if they do, in my opinion, I think they are worth it if it's with the people you love. Instead of buying that new phone, bring your parents or family on short trip, take many photos, laugh and have senseless fun. I'm sure everyone will remember the occasion for years to come.

So this week, think of how you can create experiences which will provide lasting happiness instead of buying another product that will only present you momentary satisfaction.

As always, save more, spend less on material stuff and invest wisely.
P.

The Spine of Early Retirement

I'm sure that most of you are familiar with some of the steps you have to take to reach early retirement, but bear with me as I repeat them once again for the benefit those who do not. These steps are not concrete and you can choose to take them or not to attain your early retirement but I believe that paths are similar to these. Only difference being your personal tweaks, luck and mistakes.

Without further ado, here they are:

• Start as Early as Possible - This applies not only to those seeking early retirement or financial freedom but to everyone. The earlier you start, the more time you have to allow the magic of compound interest to work. What's more, having more time allows for more margin of error. No one is perfect therefore we should always make allowance for mistakes.

• Manage your Consumption - One of the main reasons why most people are not able to save enough for an early retirement is because they spend to much. We are all wired to consume and many of us can't help it but conform. However, there is this rebel within us that does not want to conform, we want to break free from the norm - these are the people that are able to achieve extremely early retirement. Reduce spending now, stop spending money on too much wants, stick with the needs. You do not need that new hand phone just because it has a battery life of 1/2 an hour more than yours or a screen 1/2 an inch bigger than yours. Remember, you choose your enough, not your neighbor.

• .Cut down on Excess Spending -  I know it's often hard to form new good habits, but trust me, this will benefit you. For just 1 or 2 months, track every dollar you spend and at the end of the month, you will be able to see where you have been spending unnecessarily. These are the parts of your spending tree that you must prune away. If you feel comfortable keeping track of your expenses by then, you can continue doing so. If not, try to stick to your current monthly expenses less those unnecessary expenses and do a follow up 6 months later to find out your monthly expense status.

•  Be Frugal - This step is an acquired taste, once you get it, it becomes something you actually enjoy doing. However i urge you to do this is moderation if you are not alone in your journey. Your significant other might not share the same joys as you in being frugal. You have to take baby steps to let them see the benefits of being frugal. What you must do to be frugal is to view money as an extremely precious resource not be to exchanged for something of lesser value. For me, i feel that lesser value means items that bring no benefit or new experiences to your life. Most of the time, these items just bring you momentary satisfaction that last for a month at most. Not worth it.

• Never Trade Early Retirement for Happiness and Family - This is the last and most important key. You should never trade anything in this world for happiness and your family. What is the point of forsaking your happiness and family to gain early retirement? The point of early retirement is to be able to have time for both. Don't be over obsessed with retiring early that you forgo your current happiness or spend so much time tweaking your spreadsheet or monitoring your portfolio that you neglect your family. You have to set your priorities right.. what is most important in your life. For me, its family, for without them life would be quite meaningless even if u have all the riches in the world.

 I know that everyone will make mistakes as to err is to be human or was it to err is human... Anyway, i hope that on your journey to financial freedom or early retirement, you will make more right choices than mistakes. Ponder upon what is most important in your life, keep it close and never ever trade it for anything this world has to offer.

As always, save more, spend less and invest wisely.
P.

C'mon, let's get another round of drinks! Dont be boring.

Does the title sound familiar? I'm pretty sure you have heard something like that before. You can substitute the word drinks for shopping, food, hand phone and so on.

You feel pressured to spend and conform when your friends request that of you. Deep inside, you are feeling uneasy as you know that you are eating into your budget and spending way more than you actually should. Yet, to gain social acceptance, you dig deep into your pockets and scrape the dollars off the bottom.

I feel we should always do things in moderation. If you are always saying no to going out and having fun, soon your friends will stop calling. However, if you are always saying yes, you are seriously endangering your savings and retirement planning. The key is always knowing when to say yes, when to say no and when to give a better and less expensive suggestion.

If they are truly your friends, they will definitely hear you out and understand. (But not before making a sport out of you.)

Here are a few less expensive alternatives:

1. Buying beer from the supermarket and head to one of your homes to drink rather than heading to the pub and paying easily 3 times the amount. What i learnt from experience is that it's always the company and not the venue that decides whether it was an awesome night or not.
2. Get everyone to make some food and head to the park or something for a picnic rather than going to a fancy restaurant to eat. You might find that the fresh air and change of environment is extremely welcoming.
3. Buying a dvd from the store and watching it at home instead of going to the cinema to catch a movie. The dvd would cost between  $10 to $25 for all of you instead of approximately $10 per person should you go to the movies. Buy microwavable popcorn to ease in those hardcore movie goers.
4. Instead of going shopping at the mall, why not visit a flea market and have the same amount of satisfaction. You will be surprised and the amount of stuff you can find at a flea market.

The list goes on and on. Just use your imagination and I'm sure you, your friends and family will have as much satisfaction and enjoyment at a fraction of what you would have spent otherwise. Once again, i would like to say this.. It's the company and not the venue or amount spent that matter. If you are with friends and family, even the simplest of food will be a million times more enjoyable that a royal feast with...for absence of a better word, enemies.

As always save more, spend less and invest wisely.
P.

My Checklist for Retirement

Since i have decided to document my journey, i feel that it is only right to roughly state where i am on it. Honestly, i am only at the beginning, i would say that I am at about the 10% to 15% point ( I will show my portfolio allocation in a later post). The requirement for me in order to declare myself retired would be that i would have to have completed the following tasks.

1. Clear my mortgage.
2. Have an income from different streams equal to a min of all my expenses.
3. Have $0 debt.
4. Have an emergency fund of at least 1 year worth of expenses.
5. Have the min sum in my CPF

Sounds easy when generalized into these 5 point but in reality, not so. I have to continuously work hard at achieving these 5 targets should i want to retire before the age of 45. Why 45 you might ask? I chose this number because based on my calculations, which I will show in a later post, 45 would be the age whereby i can achieve these goals without compromising my current lifestyle too much. ( Wife is a spender, new house, new renovation.. etc etc)

45 is also an age whereby I am not too old to do the things i want to do such as travel, hiking and other such stuff. I would still be physically able to backpack Europe at that point, i dream i can only dream of now.

Clear my mortgage

Not clearing the mortgage during retirement would mean that 2 things, i have an added expenditure that is not within my control( cannot choose not to pay ) and my income would be reduced due to the fact that i will not longer be contributing to CPF thus I will have to pay cash for my mortgage. Not a wise choice.

Have different income streams that equals a minimum of my expenses

I would prefer not to draw down on my investment portfolio as i would like to leave it as a form of inheritance to my children. I would therefore try to create as many streams of income as possible to live on comfortably. Currently, my wife and I are working on several projects which should reap fruit in the near future. If not, we are still young and will learn from our failures and try again.

Have $0 debt

Unlike many who believes in good debt and bad debt, i am one who thinks otherwise. To me, all debt are bad debts as it only means that you are owned by someone either directly or indirectly. At the point of retirement, i do not want the chains of debt binding me. No car debts, no housing debts and definitely no credit card debts.( I always pay my credit card bills on time.)

Have an emergency fund of at least 1 year worth of expenses.

In life, nothing is ever certain, you never know when you will need extra money. I hate to think that i would have to borrow from someone to support my family in times of need. Instead, i will have an emergency fund containing at least one years worth of expenses. This would also be a safety net so i will, hopefully never have to sell my businesses or investments at a downturn to fund my living expenses.

Have the min sum in my CPF

 The reason for this option is purely personal. I feel that having an additional income coming in at the age of 65 would be something to look forward to. This extra stream of income would be gotten by putting the minimum sum from both my wife and I into CPF Life which should provide a nice extra monthly income  for several years. An extra benefit would be that after my wife and I leave this place for a better one, our kids would get whatever is left.( Since the earlier we travel to a better place the more our kids get, i seriously hope they will love us enough not to wish us an early voyage.)

These are my requirements i set for myself before considering myself retired. What are yours? I would love to hear about them so please leave comments.

As always, save more, spend less and invest wisely
P.

Life & Money - Change is the only constant

Everyone should have a plan in life. It's like a lantern that will guide your path and lead you to the destination you have chosen.

Having said that, i also have to say that a plan should not be extremely concrete as throughout the many stages in life, circumstances will change. When this happens, you should be flexible enough to alter your plan and do what is necessary to still arrive at your selected destination. You might have to take a longer time, save more money or take on more risk in order to do so.

What i have said leads to what this post is really about. It's about finding that investment method or strategy that you are comfortable with which will finally lead you to financial freedom or even better yet, an early retirement.

Throughout my short investment journey, I have tried and tested quite a number of investment strategies such as trading constantly, permanent portfolio, lazy portfolio and a few others. I have to admit that part of the reason to this is because i have been heavily influenced by the books and blogs that i have read. I do not know how others view this constant change but i feel that it is a good way for me to pluck a little knowledge from each source and eventually form an investment strategy of my own to carry me to my destination.

There are still many years ahead and I am sure that there will still be many crossroads and forks in my path to an early retirement. Changes that i can control like having a kid, owning a home and increasing my insurance coverage or changes that i have totally no control of like interest rate fluctuations, the economy and natural disasters.

No matter the change, we as humans have to adapt, survive and get out of any good or bad changes stronger.

What investment strategies have you tried so far and how have you tweaked them to achieve your goals and reach your destination? Feel free to share them here.

As always, save more, spend less and invest wisely.
P.