Tuesday, 26 May 2015

My Portfolio – Updates of Buy and Sell

I has been pretty quiet on the stock market this year compared to last. Reasons stem from intensifying work commitments, new member in the house, and also the “perceived” lesser opportunities in the current stock market. Nonetheless, I had made some transactions since my last portfolio update more than a month ago - “My Portfolio – 1Q15 Review”.


"SELL"

OUE – Sell at >5% profit at 2.19. Mission accomplished since the original intention of buying is to realise gain when OUE unlocked Crown Plaza to OUEHT.  

Lippo Mall Tr – Partial sale to rebalance exposure. Accumulated more lots earlier at 0.34 after placements, to average down from the initial >0.4 price. Since prices had risen to a high of 0.37 even after dividends payment, I decided to sell partially to rebalance my exposure.

Courts Asia – Sell entirely at a loss at 0.42 after buying at a >20% higher price earlier. Retail climate in Singapore is unfavourable with high cost from labour tightening and cautious household spending. Courts last quarter’s earnings is also badly affected by forex loss and losses from opening of Indonesia Bekasi megastore. Weaker Malaysian economy, due to oil price, GST, and political bickering does not help. 

"BUY"

Vicom – Picked up few lots. Solid company with economic moat, strong balance sheet, and steady growth over the years. I felt that there is room for growth in other segments and outside Singapore as well. Always wanted to own this counter, and did so when share price retreated slightly recently. Refer to B’s detail analysis here and here.

Woolworths (ASX) – Bluechip in Australia with >3000 stores in AU & NZ. Businesses span food, liquor, petrol, general merchandise, home improvement and hotels. Refer to website here. Price near 3 year low at mid A$28, due to competitions from another Bluechip Wesfarmers, as well as budget supermarket operators entering the market. To add “salt to injury”, its Masters Home improvement chains are not doing well. However I like Woolworths’ incredible track records of earnings and dividend growth over the years. At current price, dividend indicated gross yield is close to 7% (5% fully franked) and PE (ttm) is reasonable at 14.8 compared to Wesfarmers 32.2.

CURRENT PORTFOLIO

1. AIMS AMP Cap
2. ARA
3. Asian Pay TV
4. CapitaRetail China Tr
5. China Aviation
6. CM Pacific
7. Coca Cola Amatil (ASX)
8. Comfort Delgro
9.  Croesus Retail Trust
10. Ezion
11. Fraser Com Tr
12. KrisEnergy
13. Lippo MIRT
14. Maple Log Tr
15. Oveseas Education
16. Raffles Medical
17. Sembcorp Ind
18. SGX
19. Starhub
20. Suntec Reit
21. Super
22. Swissco
23. Vicom
24. Woolworths


Sunday, 24 May 2015

My Personal Finance Story (Part 2) – Everything Happens For A Reason

This post continues from the previous post (Part 1)... 

Graduation Woes

SARs & Debt-ridden
After 4 years of hard work graduating Bachelor of Engineering with honours, I was supposed to throw my mortar hat in jubilation. Unfortunately, the hopes of bright prospects were dampened by SARs epidemic. Furthermore, economy is still licking from the pain inflicted from the 911 attack two years earlier. In a difficult time when many jobseekers include those with work experience, finding a full-time job for a fresh graduate was like finding a needle in haystack. It could not be worst for someone who was shouldering a 40k debt (incl. interest and loan from sister), laden with paying back more than S$600 a month. It took me more than 5 years after graduation to finish repaying my loans. I am desperate to find a job fast! 

The few months serving the remaining of my NS disruption do helped to delay the woes of not having a job after graduation. I was cushioned from the few hundred dollars NS allowances coupled with my tuition income. Adverse circumstances tend make people work beyond one's limit. Every night I will spend hours trying to customize my resumes to the employers’ requirements, hoping to differentiate better against other jobseekers, before submitting the resumes.

I learnt: Adverse Circumstances Carves a Man

My First Paycheck but No Savings! 
For first few months, it is so disheartening when so many resumes sent were not even met by calls for interview or an email reply. Just a month before my NS ended, I was elated that my third interview landed me my first job in oil and gas sector as an engineer. I beat a thick stack of other candidates resumes shown by my superior. Salary was mediocre at $2k with lousy employment benefits and a 4-months bond. But who cares! Getting a job is all that matters then! To read more, refer to my earlier articles “My First Paycheck 11 Years ago compare to Fresh Graduate Salary Today.”

The $1.6k take home salary complemented by my tuition income is just enough for my loans, mum allowance, expenses etc.

BUT it provides no room for savings! 

Earnings Rose So Is Expenses 

30% Salary increment
The job market improved in 2004 and I landed myself my second job in a small local set-up with a salary of $2.6k. In the same year, I also work harder to have more tuition students. With a 30% increment and increased income from tuition, I should either have lots of savings or at least have increased my loan repayment. I didn't! Undoubtedly making my liabilities heavier, I also bought my first car, a second hand one! The only consolation is that, the car is work related and subsidized slightly by company. Still, my expenses further ballooned. 

Wake Up Call for Savings
I remembered there was once in the first year after graduation, I tried withdrawing $50 from the ATM and my bank has less than that amount! I felt so ashamed as a working adult and suddenly realized the need for savings! THIS IS MY WAKE UP CALL. From then onwards, I started to save. While I always discipline myself to save more than 40% of my salary, I have no idea of what is investment, aside from save and buy a HDB flat. The savings in the bank is not even in Fix Deposit and is earning "peanuts" interests from "save as you earn scheme" from Posb bank!

No Financial Literacy
I bought my first few stocks later, but I did not know what fundamental analysis is, and buy based on sentiments and hear-say. Like many, I bought investment-linked-products insurance after being influenced by my agent, without really bothers about what is the fund make up of. 

I was not spendthrift neither was I frugal. I love buying good quality stuffs that comes with a price tag. Because of this, I am often mistaken by friends that I was spendthrift. In oppose to what others thought, my wife always say I am frugal. She commented that I am a good purchaser in value over the price tag. Still, due to my relatively average income then, my finances were tight.

So during the start of my career, my financial literacy level is really low.

Career & Income Growth 

Earnings Growth and Bonus Share Award
The economy picked up and accelerated upwards from 2005 to 2008.  I joined a bigger company and my career and income started surfing the rising tides. Salary growth was exponential but savings and expenses rose too!

Our company was preparing for IPO then. I remembered I was the one physically typing the prospectus for my MD in a meeting room, with the rest of the management team giving inputs. Then some big MNC comes along. Attracted by the lucrative buy-out offer, my two bosses dropped the IPO plan and sold the company instead. It was to be a much better decision as they pocketed combined total of >S$100 Million! 

I learnt: Things do not always go according to your plans. But if you plan and TAKE ACTION, one thing always leads to another!

Employees including myself were given shares. The criterion is to work harder for the next three years to propel the “bottom line” so that our share values can surge. Oil and Gas is booming and we are all extremely excited. I was busy closing big deals until the GFC tsunami came!

Crisis Creates Opportunity
My company was not spared by the GFC, and retrenchment exercise was implemented. Fortunately for me, I was unaffected due to my job role. In fact I was promoted several times during period of crisis as I was part of the team that help maneuverer the headwinds facing the company! 

Nevertheless, I saw people losing jobs, it's terrible! 

I learnt: Crisis is painful but It creates opportunity too!

My First Pot of Gold
Oil prices rebounded quickly after the crisis. Three years soon passed and I received my bonus share payout. It was not as lucrative as anticipated before the crisis but it was not too shabby either, though big bulk of it has to go to income tax payments! 

With the money, I invested in a private property aside from our HDB. But before my investments, I carry out lots of research in property sector and also read a book or two on property investment too!

I learnt: Invest in yourself before any other things!

Setbacks Are The Biggest Trigger for Turnarounds 

I recognised with humility that I am person who learn fast. Even so, I have to learn through the hard ways. The key to the door of my personal finance literacy is through various acute setbacks. 

While climbing the corporate ladder, I ignore my health completely. I collapsed eventually and spend weeks in hospital.

I learnt: Life is vulnerable. We need to prepare for the worst not only for ourselves but for our love ones!

My health recovered fast thanks to a healthy diet and lifestyle later.  Then while at the top of my career, my ambitious appetite expanded further. I took on a bigger role after being headhunted by another company. No different from the stock market, the rise to peak is imminent for a crash later.

My career suffered the same fate. For some reasons, I feel uncomfortable working in the new company despite the good remuneration and authority. Eventually, I make a decision to leave without a job, with hefty family expenses behind me. Although I managed to find the next job fast, it serves as a stark reminder to me.

I learnt: There is no such thing as job security and we need to plan our finances ahead. 

Unlike the GFC, this time I felt it! 

Counter-intuitively, when I looked back today, the setbacks are one of the best things that happen to me. While it may seem a bad career decision, it serves as one of my best learning experiences. Since then, I started to develop interests in investing and blogging, outside my work.


What I Learn

Going through my own journey, I am proud to say that I am much better off today than before. I added more wisdom and happiness to my life. I pursue things that I really want over long term rather than competing with the crowd to chase for the “low hanging fruits”.

Everything happens for a reason. For without being poor, I will not realise the importance of working hard for my earnings. For without being ill, I will not realise the importance of health. For without failures, I will not realise the paths to success!

If we are positive and brave enough to overcome the setbacks, we only live to be a better person. For now, and in my own opinion, I list as follows the essences for a Successful YOU:
  • Know Who you are, What you really like in life, and Work hard for it.
  • Healthy Body, Mind and Soul.
  • Family and Friends’ Support
  • Save for rainy days. Be Frugal Not Stingy.
  • Investments in yourself before investments in equity, property etc.
  • Luck favours those who are patient and work hard with continuous learning capability

"In times when we are doing great, do not be too arrogant and over the moon. It can be that we have not experience the worst, or the success is entirely through randomness, which may not last. 

On the contrary, when we are NOT doing well due to random events do not be devastated and give up. Our time of success will come eventually, that is, if we persist, continue to improve ourselves, have good attitude, positive mind-set..etc.”  - Rolf Suey

Related Posts:
The Seminar of Financial Freedom?生存是技能,生活才是目的! Survivalis "Skill", To Live Life is "Objective"!I am Successful Because I am Capable? Do not be Fooled byRandomness!


Saturday, 16 May 2015

My Personal Finance Story (Part 1) - Started Earning Young, But No Savings!

This week, the hottest topic in the financial blogger-sphere is about why we should be financial educated. Although LP is not the source blogger causing this viral, I was influenced by his post “why I am interested in personal finance”, sharing his personal finance journey. To me, sharing of personal experiences always educates more convincingly than just infusing streams of theories. Now, let my own story begins as follows.

Primary School

I come from a humble family, “Money Always No Enough Lar!” We initially stayed in 1-room (no living room) then upgraded to 2-room rental flat (1 living and 1 bedroom). My father worked for less than $1k with no CPF, and mum was a housewife babysitting for extra income.

Started Earning
I started earning money by catching spiders at forestry areas near Jervois road and railway tracks! Spiders have to be masculine to fight in the “ring” which is my fist!. The more battles my spiders win over my friends, the more expensive I can sell. My top fighter “Blue Artillery Powder” done deal at S$8. Not too shabby back in the 80s!

source: http:/witcast.blogspot.sg

As a boy, I am competitive and always wanted to win. I understand clearly that to win, you need to master the skills and excel in it. I make use of this trait of mine to earn money! I excelled in my “Marble or GoLi” games, and will bring back more coins with sand, in my pocket each day. I also mastered “Eraser Flipping” techniques and win erasers to sell.

While I loved collecting stickers, “Know Your School, Ghost Busters, World Cup” etc. but I can barely afford to buy many. Filling up sticker album was not my objective. Instead I accumulated stickers to selling classmates who are short of the specific sticker at a higher price! 

In the absence of teachers, I will also start my sticker gambling den. I am always the banker arranging 3 stacks of stickers, pictures face up, numbers down! Bet your stickers on the stack with the largest number, you win! Somehow I will win more than I lose, sometimes with unethical method. After winning, I will sell the stickers to richer kids then. Once I had the shiny reflective Ghost-buster sticker collection “M, N, O, P” that I won, which allows me to exchange for a figurine priced at S$10. I sold at S$8 to a schoolmate. 

During primary school days, I am very good in table tennis and badminton and captained both sports for my school winning competitions. I was one of my principal’s favorite students. For doing the school proud, my principal gave me S$50.00 from his own pocket for me to buy a new table tennis bat, since mine was already old. I was so touched! 

Both my parents are not formerly educated. They were pre-occupied with their own financial problems and have little time for me. I was never taught that I need to save for the future or rainy days! The only reason I earn or save is to buy the things I really like that we could not afford.

At times what I earned will be loosely donated to “Horse Riding or Jackpot Machines!”

Secondary School to Junior College

There is no improvement in family financial situation, which means little pocket money still. Mum stopped baby sitting and go work part-time as a cleaner. We stayed in the 2-room HDB flat until I was in Junior College (JC), then we upgraded to a 3-room HDB unit, no longer rental. Finally, my parent’s own house, thanks to my working sister’s assistance! Financial burden was higher, since my father does not have CPF. So my brother has to sign on Airforce to support the housing loan. 

Having Things I Like for “Free”?
The small roof with little privacy ensured I spend most of time on the streets. One group of friends I hanged around after school was rowdy and troubles were imminent, often. To save money, some of my friends will do free groceries shopping at 7-11 at wee hours. Point blocks 5-room HDB flats, which we deemed only the rich can afford, are also our target for after-dark shopping. This is how our favorite “Neckermann” or Ocean Pacific sandals are within reach, compared to the wealthy. I always chickened out when it comes to stealing, but I was beneficiary of the goods most time as a reward for my accomplice companion. Equally bad!

Doing Things I Like Cheaply
I started playing snooker when I was age 11. I like the game, for it entails lots of thinking, concentration and skills. Typical game will cost $5-6/hr. Sounds like “a lot” of money then for a poor kid. 3 to 4 of us will always play “Punch table”, which means loser pay for the table fees! I practiced hard to make sure I win more than I loose! 


Despite on days when I am an invincible snooker player, what I does not spend “punching table”, I will lost the money saved on the snooker table, throwing into “Horse Racing Machines!” But, I recognized that no matter what, I cannot lost my following week food allowance! 

Started Working Part-time 
During holidays, my mum will also get more “shopping plastic/paper bags” for me to fold. The faster I fold, the more money we earned. I will also helped her to root out bags of bean sprouts for pat S50c to S$1 per 5 Kg. If I am fast and hardworking, my mum will reward me with more pocket money. I also started my part-time job during holidays, working at relative recommended company as data-entry clerk. I like working apparently. No, I like the Money! Of Course!

To Fulfill Your Dreams, Never Neglect Studies
Although I was often on the streets, I never neglected my studies. Since young, I hear adults say, “This is Singapore, No Cert, No Money, No Future!” My biggest dream as a boy, is always to own my 5-room HDB flat one day.  So I tell myself, I HAVE to study hard. I stay aloof my hooligan friends before O Levels and stayed focus to prepare for it.

I passed 'O' scoring L1R5 at 9 pts. I wanted to go Poly, but was convinced by my sister to go JC as an easier path to go to university. An “Anti-Shocked” Disc Man as JC enrollment criteria in exchange also helps me in making the decision. 

After A Levels, I went on to study in Engineering in NTU.
  
National Service Full-time (NSF)

Just after my A Levels, my father past away. There is no issue with financial because my Dad does not earn a lot anyway, and also because my siblings were already working and I was enlisting soon.

During NS, I was fortunate to be able to book out each day. I stopped taking pocket money, since I have my S$200-300 allowance from Army throughout the 2 years plus of service.

Started Giving Tuition, But Lost Everything to Singapore Pools
I also started giving tuition. My student is staying in the same HDB block as me, thanks to my mum’s marketing. She was primary 3 then. Few months later, I added intake of another student same education level. I was earning something like S$500 a month from tuition. Plus my Army allowance, I was a really rich Army boy, at that time. It was also the same period where Singapore Pool S-League was legalized. I lost everything I earned and save from my tuition, before enrollment to university! See why/how I lost here.  

 source: www.theonlinecitizen.com 

University

I never stop giving tuition, no matter how hectic my 4 years of University life. Since I can earn from something I enjoyed. Why Not? As my tuition students transited from primarily to secondary schools, my tuition income increased.

My father never leave behind any CPF for my University Tuition fees which totalled S$25k for four years. He does not have CPF! 80% of tuition fees, i.e. S$20k can be loaned from the bank, but I still need the 20%, i.e. S$5k paid in CASH! It was a lot of money for me back then.

Loans, Loans, Loans!
I could not get any bursary due to my elder Brother’s income is more than the family income limit. We were brought up to be responsible for our problems at home, so no family help rendered to me. Eventually, I applied for Study Loan that is able to provide me with extra S$3.6k yearly. This can pay the 20% balance tuition fees, as well as cover my daily expenses.

I had two computers during uni time. One was paid by installments drawing from my tuition earnings, and another was via Uni computer loan rendered for poorer family. I also stayed in hostel, but my sister did help to offset my hostel fees each month for me. 

Having my Private Tuition income and Study loan, means money should be more than sufficient. But being relatively spendthrift at times, having a girlfriend, plus having to go through Driving Test several times certainly does not help me financially.
  
Liabilities
Study Loan – S$14.4K (interest free)
Computer Loan – S$2.6K (interest free)
Tuition Fee Bank Loan – S$20k (prevailing interest starts after grad)
Total Loans after Graduation – S$37K excluding interests!

Borrowed another S$3k from my sister for Graduation Tour! The day I graduated, I have no savings! and close to S$40k in debt excluding interest!

What I Learn
  • Humble background sculpts my earning skills
  • Mastery of specific skill-set is a must for earning. Hardwork is needed to master skills.
  • Education or continuous learning is important.
  • Knowing how to earn is not sufficient. You need to know how to save and grow your money.
  • Pampering our-self from our earnings is still important since we need to live life happy.

Stay tuned to Part 2 ….


Sunday, 10 May 2015

Work Life Balance - Part 2: Choice, Discipline & Desire

Continuing from the previous post … that in general, I do not agree that without financial freedom, you are unable to achieve Work Life Balance (WLB). For me, WLB is definitely more related to Choice, Discipline and Desire.  

Choice

I believe there still exist many of us who are under no intense pressure to work during holidays or on leave. Could it be we just cannot bear NOT to read/reply emails, wherever and whenever they are. Sometimes you wonder if it is really Damn Urgent? Or could it be, if you do not that, your colleagues will outshine you, and he will be the next one to be promoted or have a bigger bonus.

I am one of the victims many years ago, but nowadays I try to work during non-working hours only when it is really urgent matters! To help achieve that, you can choose to be more focus during office hours and eradicate the less inefficient colleague gossips, chit-chat, surfing net, fondling with hand phones etc. In this way, we can be more work efficient.

Of course there are unreasonable bosses but in extreme situation, we need to make extreme choice to speak up in a tactful, yet cleverly expressed manner. If it does not help, we may need to bid farewell to the company eventually. In welcoming the new employers, we must be wiser and more prudent the next time.

Ok, fair enough, when you are younger, you need to work and LEARN more during non-official-working hours to scale the career ladder.

Ultimately to have more time for Family, and ourselves, we need to make the right choice in our life. To make the right choice, you need experiences and the wisdom of judgment.


A photo I taken, when I was jogging in Norway 

Discipline

I love exercising and the “sweat it out” feeling. During weekends, I will exercise with my family members. After exercising and shower, I will feel extremely refreshed. I will then enjoy my favorite coffee, accompany by blogging or reading. A nice family dinner with our favorite food will usually follow later in the day of exercising.

This is Health, Family, Leisure, Pleasure and Spiritual developments all in one, for me!

It sounds easy to achieve. Apparently, it does require lots of Discipline initially, to make it a routine.

During weekdays, the busy schedules really make it difficult to exercise. Coming home late and feeling lethargic after a long day at work, you just feel like lazing around at home. Discipline is key to overcome this. Another strategy is constantly reminding yourself that Health is the most important in our life. In that way, it is easier to put into effect the discipline part.

I will suggest a 20-30 minutes light work out. It can be just push and sit-ups at home, a slow jog or short swim, or a stroll after dinner with my wife. Lunchtime exercising if your work hours permit is great too. I use to hit the gym during lunchtime even though I need to drive 15 mins there. Ok – thanks to my more flexi work hours.

Desire

The serious health and work problems many years ago change my mindset about work ambition. It is definitely painful at that time when the problems took place. Yet, looking back, it instill in me a stronger DESIRE to PRIORITISE and achieve MORE WORK LIFE BALANCE!  

  

Is Work Life Balance Only For the Financially Freed?

Time flies this year for me. In a blink of eye, 4 months had past. I had been extremely busy in work since the start of the year. This is primarily because of my company being acquired by a bigger company and an expanded role. Do not envy, no commensurated-salary increment! :( 

I returned to office last week, after a fortnight of ICT, and work is piling. To make things worst, in the next month or so, my schedules are already packed either with overseas travel or visitors coming to Singapore.

For all my ill-fated busy work schedule, I still appreciate that I am at least able to have weekend free, for my family including my 4-month old, and also time for myself. 

When time is so limited primarily for earning money, we often lament “how to achieve Work Life Balance?”

What is Work Life Balance (WLB)?

Few days ago, I asked my wife what is the definition of work life balance (WLB)? She said spending quality time between work and family. Good answer, but not exactly holistic.

Most of us appear to know what is WLB by our own standard, but maybe it is good to know its formal definition. Accordingly to Wikipedia,

“Work life balance, is a concept including proper prioritizing between "work" and "lifestyle", where in general,

WORK includes:
  • Career
  • Ambition 

LIFESTYLE includes:
  • Health
  • Family
  • Pleasure
  • Leisure
  • Spiritual development / mediation 

Yes, PRIORITISING is critical.

Work Life Balance is Only For the Rich/Financially Freed?

To some, WLB is for the rich or financially freed people only. This group believed that it is only when you are financially freed, then you can be mentally freed to pursue what you really wanted to do! For average Singaporean, you have to slog and work. “Where got WLB?”

Agree or Not?

It's no denial that being financially free or having more money will put us in a better position of pursuing WLB. In most cases, it also provides the mental freedom to pursue our pleasure and leisure. A bigger purse can also help us to employ the best doctor when we meet with health problems. We are also able to have more expensive overseas family tours, expensive dinners, entertainments etc. For the lower income family, WLB’s correlation with money is even stronger.

When asking the questions of Money being directly proportional to WLB, it immediately leads me to think of the below examples.

Join Government Sector

I have many middle class friends in their mid to late 30s who, after setting up families want to have more time for their kids. They left their higher paying jobs in private sectors to join government sectors to have more time and better work life benefits.

For e.g. several government companies had implemented Flexible Work Arrangements (FWAs) which includes flexi work start and end time; work from home few days a month.  S’pore government has also started incentive for organizations who promote WLB or work-life friendly environment. To know more, please refer to MOM Work-life Grant – click here.

So lesser income, for more time! Money is NOT directly proportional to WLB in this case!

Financially Freed, but Mentally Not Freed

I had an ex-colleague and let’s call him Mr. L. He is 58 at that time, when we were working in the same company. Mr. L is successfully in his early career climbing in an MNC to MD position in his thirties. Mr. L is frugal and owns many properties all fully paid, supplemented with monthly rental income. His children are already working. In another words, money is never a problem. In fact, he is financially freed way before he is 50 years of age. 

Nevertheless, Mr. L did not achieve the WLB he deserved then, or at least the mental freedom he supposingly has in work. 

While in my company, for some reasons, Mr. L becomes an eyesore to the CEO. He was frequently picked, for matters not his fault. He was even humiliated in front of junior staffs. After office hours, he received repeated text messages pressurizing him on trivial work related matters. It was nightmare for Mr. L but strangely he continued to swallow his pride for more than 1 year.

His wife, who is a highly paid executive, persuaded him to leave his job. Mr. L  did not accede, even when later his Salary was halved. 

After he joined my team, I asked him why didn't he leave earlier, since money was never a concern of him? Are the sufferings worth it? 

The reply: "I needed something to do!"

To me, this is a classic example of being financially freed, but not mentally freed!

What Do You Think?

In my opinion, money is just a catalyst to WLB but definitely does not cause it. I have to admit I am financially stronger now than many years ago. But it does not mean that I have less work-life-balance at that time compared to now. Perhaps, it is a matter of mentality – Choice, Discipline and Desire!

Perhaps it is more important to know yourself better, knows what you really love and want to do, earlier in your life. Rather than to wait till the latter part of your life, that even if you have financial freedom, you will still be mentally restricted!

So how about you? Do you agree that having more money means having more work life balance?


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