Our Current Thoughts On The Local Economy, Investments, And Personal Finance

Following our usual updates on our monthly financial transactions, our monthly expenses update, as well as our Syfe updates, we thought we wanted to share a bit more about where our headspace is right now in terms of our journey towards financial independence. 

On our end, although every month Mr and Mrs Budget continue see our net worth climb, to us right now, job security is the most important thing.

Over the past 2 – 3 months, news have been covering the closure of big brands to mom and pop shops, and it’s all doom and gloom everywhere. Singapore also recorded the worst ever recession, and economy is not expected to recover anytime soon.

Source: Straits Times

If you look at the daily company announcements on SGX, most companies in Singapore are reporting losses due to the impact of COVID 19, and these are highly concerning.

Hence recently Mr and Mrs Budget has had a job review with our managers and luckily our jobs are still secured at this point. Hopefully that continues to be the case.

However, for Mr Budget, we heard that sales has been slow for the company he is working at and it causes some stress for Mr Budget, hopefully that changes in the near future.

How We Are Shaping Our Investment Approach

In terms of investing, this global recession we are in will be followed by a long muted recovery.

Hence, Mr and Mrs Budget will be looking at global high growth stocks in the ICT sectors, which should be recession and future proof.

For local Singapore stocks, we are looking at initiating positions in a few counters and start a recovery-themed portfolio

Specifically, we initiated a position in Fastly, a cloud computing service provider, which had already went up by 200% since May.

We took a deeper look at Fastly and liked what we saw – fast growing revenue, future proof industry, relatively defensible business model, and hence initiated a small position just last week. Hopefully in the long term this will reward us. 

For our recovery-themed play, we are looking at Comfortdelgro at the moment, and we may potentially initiate a position next month as we have used up our monthly allocated “investment amount” on Fastly.

Comfortdelgro Share Price 17 August 2020

We still wanted to keep a certain amount of cash on hand as there may be unforeseen circumstances that may happen over the next 6 to 12 months.

In terms of expenditure, we continue to ensure that our monthly essential expenditure remains low, and the rest is funnelled into equity investments and savings.

As much as possible and as much as we can, Mrs Budget and I try to spend whatever we can to spur the local economy. We try to order in once or twice from Grabfood as per our habit before COVID-19, and we try to head out every weekend to patron Singapore businesses.

Accumulate Assets And Not Liabilities

A recent article shared on social media also caught our attention – and we want to make sure that we do not fall into the same trap.

The article points our some bad decisions by some high earners in Singapore, and ended up in debt despite having five figures income (Mr and Mrs Budget are earning 4 figures income).

The key takeaway from the article is basically to avoid making bad financial decision leading to the accumulation of liabilities and debt.

For now, mortgage payment remains the biggest chunk of monthly cash outflow for Mr Budget. This is mainly due to his purchase of a new condo in Malaysia which recently TOP-ed.

Hopefully Mr Budget will be able to get the renovation done soon and manage to rent it out to offset the mortgage payment. Otherwise you may end up reading about this foolish financial mistake of his in the media haha.

So the key message of today’s article really is:

  1. Job security is the most important thing now
  2. Investments should be recovery themed or future-proof and recession-proof
  3. If you are able to spend, do support local businesses so that money is being circulated and “created”.
  4. Keep essential expenditure low and make sure you build your assets and decrease your liabilities

Stay safe everyone, and let’s hope the economy continue to improve! Happy to hear your thoughts too!

Also Read: What We’ve Learnt This COVID19 – Using US Stocks To Boost Overall Portfolio Gain

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