Follow One’s Own Heart And It Will Never Go Wrong

I learn one phrase which sounds reasonable and clear.

“If one listens to other’s opinions and follows accordingly, one will be other’s slave forever”

I pondered further the back meaning of the above phrase and fully agree with the analogy. I tend to be bothered by other people’s opinion and will change the initial decision to suit these people’s feedback. Since then, I no longer follow other people’s opinion and follow how my heart goes. I will not regret the consequence of my heartfelt decision and be responsible for the outcome. I feel that I am more happier by following my personal heart and it makes myself more fulfilling and satisfied with myself.

Once I make my decision, I will look forward and execute my plan accordingly. There is no point looking back and ponder how the outcome of the decision will unravel or wonder the outcome of the other decision which I chose not to take.

WTK

Transfer Of Monies From CPF Ordinary to Special Account

The prevailing interest rate of CPF ordinary and special accounts are 2.5% and 4% respectively. Sometimes in January 2016, I transferred about $61,000 plus from my CPF ordinary to special accounts. As such, I reached the CPF Special Account Ceiling at that point of time.

I did not regret this decision at all. In fact, I am of view that I should have made the transfer earlier. It’s better to be late than never. Since 2000, I have been contemplating the transfer from ordinary to special account. However, I was persuaded not to do so by my friends who advised the impact of such transfer which would cause me to have insufficient CPF ordinary account to pay for the downpayment of HDB flat in the event if I get married. It was only in January 2016 in which I opted to execute the decision of the transfer. I did not inform anyone of this decision as I did not want other to influence my decision at that point of time. Though I noted the significant drop in my ordinary account after the transfer, I am glad to see that my CPF ordinary account balance is higher than the balance of my CPF ordinary balance – before the CPF ordinary to special account transfer in January 2016.

I have no problem using the current CPF balance to pay for the HDB flat. However, it is unlikely that I will utilise the CPF to pay for the HDB flat based on the following reasons.

  • CPF saving is meant for retirement and not for other purpose in my prespective.
  • I am inclined to rent rather than buy the HDB flat as I do not want to be locked in the HDB flat with the declining lease term. The generated dividend from the investment portfolio will go to great extent in paying the rent on continuous basis for a lifetime.

 

My two cents worth of view.

 

WTK

To Retire Or Not To Retire Now

I will be reaching the age of 40 soon. It has been my dream to retire at the age of 40. As mentioned before, I will be reaching the 18 years of working in the workforce at the end of this year. The time has made me consider whether I should make the decision to quit the rat race for good. I feel that I need to be doing something which is to my interest instead of tendering my resignation and staying at home doing nothing.

Currently, I have no liability and only the commitment of supporting my parents who are retirees. There is no worry of me having to supporting the family as I have the investment portfolio which support the family for about 17 years if I quit my current job now and not working at all and living on the dividend generated from the share investment.  The number of years can be extended to 21 years if I reduce the yearly expense by $5,000.  Such lifestyle is good. However, there is no long term retirement plan as the investment portfolio will be diminished by 2035.  I believe that I can opt to do something which is to my interest and at the same time generate some form of income to complement my living expenses. I am embarking on some projects which are of interest. However, such projects have yet to generate a single cents. Blogging is also one of my projects and I recently started the blogging project since 19 May 2018.

At this juncture, I am of view that I will continue my full-time employment which continues to generate some positive savings after offsetting the monthly expenses inclusive of household allowance. The positive savings will be channelled to my investment portfolio which generates more dividends on a monthly basis. It is nice to be in such position in which I have many options to choose from. I will take my time to make the appropriate decision accordingly.

WTK

25 Times Annual Income Or Expenses

There is a saying on the amount of money one need to have before considering the retirement from the full time employment. Mutiply one’s desired annual expense by 25 and one can retire if the derived figure is achieved in one’s networth.

There are instance in which some may advocate replacing the annual expense by annual income. I believe that the decision is entirely up to the preference of each individuals as per ser.

During my embankment on the FIRE journey, I used to have the above-mentioned mentality. However, I no longer have such thought. The definition of FIRE figure varies based on different computation. I am of view that lowering the expense is the way to an early FIRE. In addition, FIRE does not mean full retirement. It means the ability to do things which  I like and such things also generate some form of active income along the way.

I feel that I should not concentrate too much on the math behind the financial independence or early retirement. I will be also missing on the big picture. I can choose to do the things which I like now rather than waiting for a few more years just to be safe. It is not worthwhile waiting a few years. Life is short and tide waits for no man.

I am of view that FIRE allows me to be have the right and liberty to be more of myself.  It provides me the gift to become a true me. I can place my passions and hobbies to the forefront of my life in which such interests are given more attention and focus.

I feel that I can add value to such interests and eventually the interests can generate value in terms of satisfication and possibly some form of income along the way.

The passive income which my investment portfolio is currently generating gave me the courage to take that leap. Being in the position where my liability could be covered signifies that I feel confident to strike it out on my accord. There is no need for me to make much though I still keep my full time employment which will generate more fund to my investment portfolio.  I feel more at ease as I do not fear the retrenchment which can come anytime to me.

To each of their own. The most thing is to do things one like.

My two cents worth of my views.

WTK

My Approach Towards 99 Years HDB Lease

The below websites on the HDB lease is as follows:

https://www.straitstimes.com/singapore/housing/understanding-what-happens-at-the-end-of-a-99-year-lease

https://www.straitstimes.com/singapore/housing/lawrence-wong-there-is-still-value-in-older-hdb-flats

https://www.straitstimes.com/singapore/parliament-extending-leases-of-older-hdb-flats-involves-serious-trade-offs-and

have a different approach how to handle the 99 years HDB lease. Take it as a pinch of salt.

I do not buy the HDB flat and rent instead. You may be wondering on why I adopt such approach. I am in dividend investing and derive my fund from the dividend which are generated from my share investment portfolio. I use the dividend to pay for my monthly rent. I am not particular on the location of Singapore and in fact, the room which I rent, is located in so-called less populated area in Woodlands. This caters to the low rent which I am paying every month.

A lot of my friends have been questioning my decision to rent instead of buying at least a HDB property.  To them, they feel that the money which I use to pay rent is wasted. I previously tried to explain the rationale of my decision to rent. One of the reason is that I will be saddled by the monthly instalments from the loan.

I live a minimalist lifestyle and do not see the need to buy a big property. Hence, I am not inclined to buy the HDB flat with the 99 years lease even though the lease exceeds my lifespan. Who will live more than 140 years old. As such, this will not be a concern for me.

My friends do not accept my rationale. Since then, I simply keep my reply short by stating that this is my preference and I am happy with my decision. I am content with my minimalist lifestyle and am glad to lead a life without debt.

To each of their own.

WTK

Power Of Zen

Arising from my recent post on my conflict with my superior in my current workplace, I came to learn of the power of Zen.

It is not the shit life which throws at me. I have a choice how to react to the circumstance. I am adamant that the best approach to deal with such circumstance is to adopt the power of Zen. Keep cool and take things lightly. Of course, talk is cheap and action matters. I resolve to put the talk into practice on a daily basis.

It is all up to me to be constantly mindful of my reactions to the negative people and stimuli.

Instead of letting the world define me, I will define my own world. Life is too short to let myself be upset by someone having a bad day or an abusive boss. I will not let the world drag me to a level beneath me. I will pull myself to an elevated level and focus on things which I have control on. I do not have to go out of way to annoy my boss. I will tell myself that it is work afterall and I will follow the instruction of the boss as well as the instruction does not go against my conscience and law.

In life, it does not matter what happens to me or where I came from. It matters what I do with what happens and what I have been given. The worst case scenario is that I quit the rat race as I know I have a huge buffer as my back-up in times of employment. I also have options to find alternative employments while having my current employment now.

WTK

Careshield Life Plan

I just mentioned Eldershield a few days. Now, the Government comes with a new plan called Careshield to replace the existing Eldershield. The entry age will be from 30 to 40. However, the premium for the Careshield Plan is expected to be higher than Eldershield. Please refer to the below websites for more details.

https://www.straitstimes.com/singapore/health/new-mandatory-careshield-life-replaces-eldershield-in-2020-will-offer-wider

https://www.straitstimes.com/singapore/health/good-that-careshield-life-is-inclusive-but-payouts-need-to-be-higher-young

https://www.straitstimes.com/singapore/health/careshield-life-to-replace-eldershield-from-2020-what-you-need-to-know

https://www.straitstimes.com/singapore/people-already-on-eldershield-can-opt-to-join-careshield-life-from-2021

Based on the above websites, it appears that the Government is making the Careshield Plan compulsory for all the eligible Singaporeans from the age of 30 to 40 with effect from 2020.

As for my case, I just opted out of Eldershield recently. It is not compulsory for me to be enrolled in the Careshield given that my decision to opt out of Eldershield Scheme. As it stands, I continue to remain

Simple Share Investment Strategy And Minimalist Lifestyle

Dividend Growth investment is always scary to the first time investors. I am one of them previously. I recall that I tend to look the price of the shares after purchasing the said shares at the beginning of the dividend investment journey. When the share prices dropped before my purchase price, I tend to start worrying on the decision in which I bought the share. I guess that this is a human instinct as panic button kicked in involuntarily and started casting doubt on the purchase decision. Now I don’t have such problem. I believe that it is entirely due to the eight years of cash stash in which I keep as the emergency fund. I know that the effort which I put in the dividend investment strategy will eventually reap reward. Furthermore, I spread the risk to many dividend yielding shares (i.e many baskets) and know that I will not be affected by the bankruptcy of few of these share counters. I allocate a fixed amount of the monies in each share counter.

If the worst case scenarios (i.e failure of all these share counters) occur, I still have the backup of my emergency fund to rely on.  My current strategy is to channel all of the savings resulting from the monthly salary derived from my full-time employment with offsetting my expenses (such as personal and household allowances etc) to the shares investment. This is reinforced by the dividend generated from the prevailing shares currently in my portfolio.

I consider myself as FI at the current circumstance. I can retire early at any point of time when I want to do so. I lead a simple and minimalist lifestyle. I am content on this lifestyle and enjoy it to the fullest. I do not have packed schedule and allocate a lot of time to self-thought. Life is great!

WTK

The Best Time Is Now

At times, I hear people who wanted to invest for financial freedom. However, they highlighted various type of reasons which hinder them from doing so. Some of the reasons are as follows:

  • The current saved amount is too small and does not make any significant investment.
  • There are a lot of expenses and bills in which they have to cover and there is no much excess balance in which they could utilise and channel into the investment.
  • Bad habits and horrible mistakes.
  • The amount of the salary they current earn. If the salary is minimal, it will not make any difference.

My answer to the above barriers quoted by the people is simple. Just get started. It does not matter how small their saving is at the point of time. The most important thing is to get started and pump the saving into the dividend yielding stock which will generate the dividend for the lifetime. The little amount of investment will eventually evolve into the enormous investment portfolio which generate the increasing dividend on a continuous basis for a lifetime.

It’s that simple and cool.

WTK

Eldershield Scheme

I recently opted out from Eldershield Scheme. Details on the Scheme are as follows:

https://www.moh.gov.sg/content/moh_web/eldershield.html

The reasons why I opt out from such Scheme are as follows

  • The premium of this Scheme is paid by CPF Medisave account. Leaving the premium sums in my Medisave account and letting them accumulate (with four to five percent accrued interest), saving a modest amount of money on the side, I would have the almost same amount of the payout from a potential ElderShield claim by age 65.
  • The payouts is insufficient to convince me to reconsider rejoining the Scheme.
  • The payout is too low to replace the income of a family member who may have to quit the workforce to take care of the incapacitated person. Neither the amount is sufficient to pay for the cost incurred in hiring a nurse in taking care the person for an indefinite amount of time.
  • The payout will only kick in if the incapacitated person is unable to perform at least three out of six activities of daily living.
  • It is more appropriate to self-insure by relying on the investment portfolio. For example, an investment portfolio involving $100,000 of shares/REITs yielding 4.8% will give one $400 a month for a lifetime and the shares can be transferred to the next-of-kin if the inevitable event occurs.

WTK