September is the month that Ally turns four and it seems like not too long ago that she first came into this world. It has been a challenging yet fulfilling journey and we treasure every moment with her. We also celebrated Grandma’s birthday with four generations gathered together, enjoying some simple yet quality time, and of course, good food too.
Work
And as we are counting down towards FI, work has been less stressful for me nowadays. Mr Tako, one of the FIRE bloggers (which we are ardent followers of) had previously blogged about this phenomenal – becoming better at work when you realised that you do not depend on your paycheck for majority of your living expenses. This has many positive repercussions. For once, I feel a lot more confident at my job when I am not so bothered by the year end appraisal anymore. I feel a lot happier when I do not take those criticisms and nasty remarks seriously which previously would have hurt my pride. In a nutshell, I’m probably just coasting towards FI nowadays.
As such, I start to treasure the colleagues / clients around me more as my days in the corporate world might be ending soon. I start to think about creating value for my company and try to make the best of my time while I’m still there. I’m organizing weekly runs after work to let people from different departments to mingle around and create a healthy lifestyle culture. I’m also part of the CSR (Corporate Social Responsibility) team that organize events like blood donation drives, activities with charitable organizations and sustainability activities to create awareness on how our daily activities are contributing to global warming. All these activities/experiences create a sense of purpose, compared to the mundane routines of my job. And through these activities, I uncovered that I got an unique strength to bring people together through organizing all these events, something which the big boss also found amazing (yes, brimming with pride here :o)
Finance
Recently, the global stock market took a beating due to various reasons including the trade war, record debt level and slowing economic growth. With the current longest bull market in history at a decade old, I personally think that the time is near towards the start of a bear market. With the stock performance being lacklustre recently, we had cashed out from most of our stock winners. Our balance portfolio are mainly made up of the residual stocks whereby we already took back most of the initial capital and some solid dividend paying stocks such as Singtel.
We will still stay invested during this period of time as we believe in getting paid with dividends while waiting. This is a pretty good article that I would recommend a read – “Learn from 1987, stay invested and don’t panic during this market chaos“.
Below are some indicators which might trigger the next bear market.
1) With the SIBOR rate currently on an uptrend, I think people should be more prudent when they are taking up a floating interest home loan as every small increase might cause a few hundred dollars increase in your monthly installment. With the Singapore Residential property price index also at historical high, home prices should be peaking thus it might not be the best time to buy a house and take up a huge home mortgage.
Reference: https://www.moneysmart.sg/home-loan/sibor-trend
Reference: https://tradingeconomics.com/singapore/housing-index
2) Our Certificate of Entitlement (COE) trends which started the upward climb since 2008 is also trending downwards. This also means the probability of a recession is near as the last time COEs were this low (remember the $2 COE in 19th Nov 2008) was during the midst of the 2008-2009 global financial crisis that saw Singapore’s economy enter a technical recession. “When the economy enjoys strong performance and Singaporeans’ incomes grow, COE prices are likely to go through the roof, while they might fall during a recession.”
Notice that most of the COE trough coincided around the same period of major economic crisis like 9/11 in Sep 2001 and Lehman Brothers in Sep 2008.
http://tralvex.com/pub/cars/coe.htm
We experienced first hand during the unfold of the 2008 economic crisis and hopefully we are in a better position to capitalized on the upcoming crisis. We are not sure when it will happen but always “Be Prepared“.
Book
Recently, I read a great book titled “Alibaba: The House That Jack Ma Built” by Duncan Clark. This book chronicles how he rosed from humble beginnings as a poor school teacher to become one of the richest man in the world. The most incredible thing about his success was that he was never an elite scholar, had no financial backing and he had no knowledge of the internet. With all these so called “disadvantages”, he managed to build one of the world’s largest internet company which all started from a simple vision. In addition, his never give up attitude when faced with many early setbacks during the initial start-up of the company played a key important role in the success of the company. His personal charisma and vision was how he could convince big venture capitalists to invest in Alibaba during the early days, including Goldman Sachs and SoftBank.
You can also watch Alibaba’s documentary “Crocodile in the Yangtze: the Alibaba Story” and also some of his charismatic videos on YouTube. He is the perfect example of “Failure is the key to success“; each mistake teaches us something new.
Recently, he announced his retirement in about a year’s time and will focus on philanthropy in education. He cited Microsoft co-founder and philanthropist Bill Gates as an example. Jack Ma said he could never be as rich as Bill Gates — but that he could retire earlier than him. Bill Gates stepped down as Microsoft’s chairman in 2014, at the age of 58.
Fitness Update
My weekly fitness routine:
1) Daily static exercise routine (5 times a week):
1. 1 min wall squat
2. 20 x one-legged squats for each leg
3. 20 x lunges for each leg
4. 30 x push ups
5. 45 secs plank
2) 1 x Staircase climbing 30 levels up and down plus static exercise on both ground and top level. (Done during lunch time in my office building)
3) 2 x 5 km run (average 5 mins / km pace)
4) 1 hour yoga Lesson with Kate every Saturday morning
5) Using the Great Eastern Get Great app, I’m currently trying to average 8000 steps daily and redeem vouchers. Enrolling in the National Steps Challenge which is starting its Season 4 soon.
Family
Below are some of the simple activities we do on weekends:
This month also coincided with the mid-autumn festival and we went to Gardens by the Bay to see the beautiful illumination.
Kate also went for a mooncake baking session with Ally and both of them made four mooncakes together in school. Dave did a lantern making session with Ally in school.
Ally tried the cosmic bowling (aka bowling with glow-in-the-dark pins and balls) at SAFRA Punggol and Ashton learning how to stand supported
Financial Update
We had managed to compile our September cash outflow and below is a snapshot:
FAMILY ($4,858.29)
Core: Variable ($2,520.70)
Food ($472.12)
$472.12 – Meals for our family of four (this includes snacks and drinks, etc.)
Household ($34.80)
$27.90 – Newspaper subscription for Kate’s parents
$6.90 – Remote Control Holder
Personal ($355.31)
$12.00 – Dave’s haircut
$53.85 – Kate’s clothes
$32.00 – Knee Support (Kate’s mum)
$80.00 – Passport and IC application (Kate’s mum)
$82.90 – Skincare and Toiletries
$12.00 – iPhone Battery
$80.00 – Yoga lesson for one month (For both Kate and Dave)
$2.56 – iCloud 50 GB storage (monthly fees for Dave and Kate)
Groceries ($270.10)
$270.10 – Mainly groceries and some other household items from the supermarket
Transport ($198.80)
$100.00 – Ezlink card reload for both of us (for bus and train rides)
$98.80 – Taxi
Kids ($1,189.57)
Ally
$850.00 – Full day child care for Ally (inclusive of some optional enrichment class)
$22.00 – Mooncake baking class
$53.10 – Skechers Shoes
$9.90 – Mosquito Patches
Ashton
$13.75 – Snacks
$70.00 – Passport application
$27.50 – Teether
$143.32 – Diapers
Core: Fixed ($1,411.25)
Utility ($343.48)
$122.68 – Electrical/Water/Gas
$78.00 – Property Services and Conservancy Charges
$142.80 – Mobile / Internet
Mortgage ($820.00) – Paying using our CPF. 20 year bank loan (First 3 years fixed interest and floating on the 4th year onward pegged against the FHR9 rate). We would like to maintain an arbitrage on this home loan as the interest is less than 2% and we might repay it in full should the interest spike up when we reach FI.
Insurance – Health ($247.77) – Insurance premiums – hospitalization and outpatient (annual premiums amortized into 12 months)
Non-Core ($926.34)
Gifts ($294.00)
$144.00 – Ally’s birthday celebration – including a 2kg cake and goody bags for classmates
$50.00 – Mooncakes (Kate’s Family)
$100.00 – Red Packet (Dave’s Grandma birthday)
Donation ($10.00) – Temple
Insurance – Savings ($622.34) – Insurance premiums – includes savings and whole life policies (annual premiums amortized into 12 months)
PARENTS ($346.42)
Insurance – Health ($346.42) – Insurance premiums – hospitalization and outpatient (annual premiums amortized into 12 months)
Note:
– This monthly cash outflow report is use mainly to gauge our post FI expenses
– We included Insurance Savings as part of our cash outflow until they are fully paid up. The reason is that we will most probably still be paying for them even if we reach FI. We do acknowledge that this is not an expense but it is still a cash outflow nonetheless unless we monetize the accrued cash value of the savings policies.
– For an explanation on the above new categorization, you could refer here
– For our 2017 cash outflow full analysis, please click here
FI target family cash outflow (excluding parents) = $5,000 per month (core $3,500 and non-core $1,500)
Summary
Family ($4,858.29):
Core ($3,931.95) :
This month our family core cash outflow is pretty close to our average of $3.7k and hope to maintain this on average for the next three months towards the end of this year.
Non-core ($926.34) :
This category is slightly higher as we celebrated two birthdays for Ally and Dave’s Grandma.
Parents ($346.42):
We finally reduce our parents allowances significantly by topping up with an initial lump sum into their retirement account (CPF Life) which will guarantee payment to them for a lifetime. This will transfer the reliance on us to give them cash allowances to CPF Life which works like an annuity. So we are now only paying for their health insurance which should slowly creep up as they age.
Grand Total ($5,204.71)
We spend about $5.2k based on the overall cash outflow this month and it is also below our monthly average $5.6k. We should be able to maintain this level of cash outflow for the rest of the year.
What was the month of September like for you?
