A Look At Our 2020 Investment Goals

With the new year coming, Mrs Budget and myself have started to plan and budget out our finances for the upcoming new year. 

One of the spreadsheet that we have is that we have a portfolio projection sheet on our personal finance sheet. This is probably one of the most important spreadsheet for us as it serves as a guiding principle as to how much we will have at the end of every year, and with that amount, we are able to plan for our future life milestones.

It looks something like this:

Mr Budget’s portfolio projection

To arrive at this table, what we did was to create individual projection tables for each of our asset classes.

For example, for our Singapore portfolio, every year we project to have a capital injection and gain of S$30,000, along with a 5% dividend yield. With those assumptions, we are able to project our annual future value for our Singapore portfolio. 

We then do the same for our US portfolio along with our CPF funds, and when you add up the individual line items, you will be able to see your projected annual net worth. 

Of course, these are just guidelines and when we do our annual reconciliation, we will see if we can hit the targets which we set out for ourselves. 

So for 2020, what we’ve set as target for ourselves is to:

  1. Capital injection / capital gain of S$30,000 into Mr Budget’s Singapore portfolio, with a 5% dividend yield
  2. Capital injection / capital gain of S$10,000 into Mrs Budget’s Singapore portfolio, with a 5% dividend yield
  3. Capital injection / capital gain of S$20,000 into Mr Budget’s US portfolio
  4. Capital injection / capital gain of S$10,000 into Mrs Budget’s US portfolio
  5. Continue our annual S$7,000 CPF contribution for tax relief and retirement purpose

The sources of these capital injection and our CPF contribution will of course be from our monthly salary. If we follow the plan, we will be able to hit our mid term goal of having a S$300,000 joint equity portfolio by 2021. 

However, as previously noted, for Mr Budget, his cash holdings is a bit on the low side for now, and that for next year, he might just be holding on to his cash and put it into a high yield savings account. 

For Mrs Budget, hopefully we are able to add more quality REITs or Trust as well as US stocks in her portfolio to balance out the portfolio composition.

While we have earmarked a certain % of investment cash ready to be deployed in the new year, whether or not we will hit our portfolio targets will largely depend on whether are there any attractive opportunities in the market.

So what’s our investment goals for 2020?

  1. Keep our eyes peeled for investment opportunities. Here are our criteria:
    • High dividend stocks
    • Companies with increasing yoy annual revenue, profit
    • Companies with net asset > current liabilities + high cash reserves
    • Companies in high growth industries 
  2. Replenish and stock up our cash holdings
  3. Keep our savings rate up since the only big ticket item soon will be when we are ready to have our Budget Baby
  4. Be a more sophisticated investor and to start looking into bonds and individual companies in a deeper level.

With our wedding soon to be over, hopefully we will be able to hit our financial targets we set for ourselves in 2020. 🙂

What are your 2020 investment goals?

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Civil Servant’s 0.1 Month Bonus – What It Means And What Are We Doing About It

So one of the biggest news yesterday was the announcement of the annual bonus for civil servants.

If you have not read it, basically, according to the Public Service Division, most civil servants will get a year-end bonus of 0.1 month this year, with a one-off lump sum payment of S$250 to S$1,500.

Of course, there were a lot of unhappiness aired by Singaporeans, especially those in the civil sector. Mrs Budget is also part of the civil service. 

Is 0.1 month bonus very low? Well yes, if you look at the historical annual bonuses for civil servants over the past few years.

Dr Wealth did a very handy bar graph to help visualise this:


Here’s what the graph show:

  1. 2019 bonus of 0.55 months has been the second lowest payout in the last 14 years.
  2. The lowest payout was in 2009, in the aftermath of the financial crisis, at 0.25. It was the only time in the last 14 years that no mid-year bonus was given.
  3. The highest bonus given is 1.7 months. 
  4. Following a low annual bonus, the year after will usually see at least a 1.5 months of annual bonus (year 2010, 2013, 2017).

According to an internal note to public officers that was made available to the media, Trade and Industry Minister Chan Chun Sing said that the economic performance this year has been weak, and the economic outlook remains uncertain and challenging with downside risks.

What that means is that, going into 2020, economy will continue to be sluggish and with the global trade war still ongoing, things are not going to go up anytime soon.

What Can And Should We Do

So instead of complaining, or after we complain about the decrease in bonus, what we should be doing is to make sure we prepare adequately in case of a recession mid late next year.

For Mr and Mrs Budget, we will be looking to trim down on our monthly expenses, as well as revoking into our financial commitments. This means that we should cut down on food delivery, and cook more often at home. Entertainment cost is also an area we need to cut down on.

Also Read: November 2019 Monthly Expenses Update

Mr Budget also has a high monthly mortgage commitment, and that is something that is constantly weighing him down. So we will have to see if there are ways to go around that. 

Other than relooking our finances and be more prudent, perhaps more importantly, is to make sure that we increase our cash holdings which serves as our war chest to be deployed when there are any stock opportunities. 

Currently for Mr Budget, his cash holdings is a bit on the low side, as most of it is invested out into the market. What he will be doing for the next year is to increase his cash and cash equivalent, and continue to contribute to his CPF.

Based on a simple projection, if he did not put any more stocks and just save up his cash from his salary, by end of next year, his cash holding should be between 30% – 35%. His pension fund should swell to 38%. 

Note to self: Please don’t buy anymore stocks in 2020 unless they are absolutely attractive. 

For Mrs Budget, she is currently overweight in her CPF, with half of her current net worth (minus properties) consisting of her CPF. What she will be doing next year is to continue to pile up on the cash and can be slightly more aggressive in scouting for investments to spread out her portfolio more. 

Based on a simple projection, if she buy S$6000 of stocks and save the rest of her salary, by end of next year, her cash holding should be around 30%, while maintaining a 48% CPF portfolio and a 12% SG stock portfolio.

Hopefully we can stay on this path towards increasing our cash % holding. 

For those getting more than 0.1 month of bonus, please save up, because winter might be coming! The government usually knows more than we do!

If you are in the private sector, how much bonus are you expecting to receive?

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monthly updates

What Have We Done This Month Towards Our Financial Goals – November 2019

So November has came and gone now.

While everyone else is doing a monthly portfolio update, we thought it is more meaningful to document what we have done this month towards our financial goals.

Mr Budget
Position Added: Lendlease, Ascendas REIT, Powermatic, SE, PDD
Take Profit: Frasers Logistics Trust, Asian Pay TV Trust

Mrs Budget
Position Added: N/A
Take Profit: N/A

Here’s a graphical representation of what we have done this month towards our financial goals:

So as you can see, it was a busy month for Mr Budget. As previously shared, Mr Budget took profit on Frasers Logistics Trust and Asian Pay TV Trust.

You can read more about the reasons why here

With the proceeds and using up some of his cash savings, Mr Budget added on 5 new counters.

The first counter was Lendlease, which was also mentioned in the previous update

The second counter added was Ascendas REIT. Mr Budget has been eyeing this REIT for a while now, and with the recent price weakness, Mr Budget decided to pull the trigger and went in to buy some Ascendas REITs for long term investment. 

If you have been an avid follower of the finance space, DBS Bank has been actively promoting their new roboadvisor, the DigiPortfolio. DigiPortfolio, which invests in NIKKO Straits Times Index ETF and NikkoAM-StraitsTrading Asia ex Japan REIT ETF

If you look into the portfolio composition, the highest REIT holdings for the various portfolio under DigiPortfolio is Ascendas REIT. 

Other than the fundamentals of the REIT, this gives us a lot of confidence in Ascendas REIT seeing that the REIT takes up a substantial portion on the various exchange traded funds. If the funds are buying in, surely they know more than what we do.

We foresee strong growth from Ascendas in the long term especially since they announced that they will be acquiring 30 properties from Capitaland, increasing the DPU performance in the future.

The third counter I added is a bit speculative: Powermatic Data.

We first came across this counter while tracking Kyith’s investing activities. He has been purchasing the counter as of late, and while digging deeper, we also like what we see. 

Powermatic is a computer components distributor, and its a good growth company riding the 5G tech wave, providing customised wi-fi solutions. 
Its recent financial report shows the following:

  • YOY revenue +30%
  • H-YOY profit +46%
  • Total current assets S$39M, Total cash S$35M with no borrowings. This is a company loaded with cash.
  • They have investment properties of almost S$19M, and S$4.7M in plants and equipments.
  • They have a total headcount of 88 person generating S$21M in revenue, translating to S$240,000 revenue per person.

There are other bloggers too that agree that the company is undervalued.

Hence Mr Budget took a small position on Powermatic Data, and we have a very good feeling about this counter. We like that the company is cash and asset rich, strong financial growth, and is in a high growth industry.

The fourth counter that I added on recently is SE, or the parent company of Shopee. Mr Budget has also been sharing that he has been eyeing SE for a while now, as he is very impressed with the continued growth of the company. He finally pulled the trigger and added the counter in.

And the final one is PinDuoDuo, with the catalyst being Amazon opening up their new store on the Chinese e commerce platform. Pin Duo Duo’s addition is also a way for us to get some exposure to the China market. 

Other than the rebalancing of his portfolio and the annual clean up, Mr Budget also made a small contribution to his EPF account in Malaysia to enjoy the annual 6.5% interest rate. This amount will be used for retirement purposes.

Mrs Budget, on the other hand, has not made any purchases or sold any of her existing positions. The good news this month was that, Keppel Corp’s share surged on news of Temasek’s acquisition, hence lifting the overall portfolio value of Mrs Budget.

So that’s an update from us this month. 🙂

How have your month been? 

Monthly Tracking

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7 Things To Check On Our Financial Check List Before The Year 2019 Ends

With 2019 coming to a close in less than 6 weeks time, it is time to take stock on our financials. This is probably one of the most favourite time of the year for the both of us, as with everyone else. 

End of the year usually means less hectic days, holidays to look forward to, planning for the new year as well as retrospecting the previous year and see if we can reap any benefits from the hard work we put in throughout the year.

Here are some financial checklist for both Mrs Budget and myself to clear before welcoming 2020.

1. CPF and EPF contribution

One of the main thing we set out to do every year is to top up our CPF to have forced savings as well as to enjoy tax relief on the top up. In case you are unfamiliar with this, you enjoy tax relief of up to S$7,000 on your taxable income for every dollar you top up on your CPF. 

Both Mrs Budget and myself have already topped up our SA account earlier this year, so this is checked. Other than that, for Mr Budget, every month when he received his OA contribution from his employer, he would instantly transfer that OA amount to his SA account to enjoy a higher interest rate, leaving S$0 in his OA Account.

On top of topping up of his CPF account and transferring his OA to SA account, as Mr Budget is a Malaysian, he has an EPF account. One of the checklist for Mr Budget is also to top up some amount to his EPF account. For EPF, the interest rate is even higher at 6.15%!  He has made a partial top on once earlier this year, and will do another top up in December.

2. Insurance Review

The second thing to do is to review your insurance coverage. As we get older, it is good to constantly review your insurance coverage with your Insurance Agent.

For Mrs Budget and myself, we are covered by a term insurance, which is sufficient for us at this point. We have already done a few check ins earlier this year with our Insurance Agent, and our next check in will probably be mid next year.

3. Credit Card Review

The third thing on our check list is to do a clean up of our credit card, and to relook into our spending patterns to see if there are any better ways we could have optimise our credit card spend.

For now, we are mainly using DBS Live Fresh, UOB one, Standard Chartered Unlimited, as well as Citi Premier Miles. 

We will have to review the cards again and see if there are any better cards out there. Of course, end of the year is also a good time for you to pay off any of your credit card bills and make sure you don’t bring them into the new year.

It is also probably a good idea for you to check on your credit rating. Mr Budget has a habit of purchasing his credit rating report every 4 – 6 months to ensure that his credit rating is on the higher band. You can purchase your credit report for just S$6.42.

4. Reap your rewards

At the end of the year, it is also a good time to reap the rewards of all the hard work you put in throughout the year.

Throughout the year, we have been actively utilising cash back cards, coupled with Shopback to earn additional cash back. On top of that, we have also been collecting miles.

It is a good time to cash out all these earned rewards and see if you want to spend them on a trip, or simply use them to reinvest into a savings account. 

For cash back, Mr Budget has earned over S$3000 in total cash back from January to October this year, and for interest income from his DBS Multiplier Account, he has enjoyed S$800 in interest income so far in 2019. 🙂

5. Housing Matters

Another thing which we want to check off our financial checklist end of the year is also to tabulate all the cost associated to our properties.

As we are living in a condo now, we will need to tabulate all the expenses incurred, so that we know how much we have spent if we were to calculate the actual return of the property should we choose to sell it down the road.
Expenses include, renovation, condo management fee as well as any one-off expenses incurred. 

6. Marie Kondo your portfolio

If you’ve been reading our updates, we would also like to do an annual clean up of our portfolio, which Mr Budget recently did.

Basically, review your individual counters and ask yourself if you are comfortable in holding on to the counters you are holding on. Does the fundamentals of the counters stay the same? Will they reward you for holding them on into the new year? Do they spark joy (lol)? If they are not, you should probably sell them off and keep the cash to reinvest in other more attractive counters.

It is also a good time for you to Marie Kondo your room or house so that you can throw away the unnecessary stuffs, as the saying goes, 旧的不去,新的不来。

7. Personal Net Worth Reconciliation

Finally, the last thing on our check list, will be to reconciliate our finances for the year, and compare that against the target we set for ourselves at the beginning of the year. 

What this means, is to calculate our total CPF, cash in hand and asset value at the end of the year, and then see if it is satisfactory. 

Currently, we are using our own custom spreadsheet to do our monthly reconciliation, and we will be sharing that spreadsheet if we have enough request for it. 🙂 

Are there anything that we’ve missed out? Let us know in the comments below!

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4 Important Financial Questions To Ask And Discuss With Your Partner

With the end of the year coming, Mr Budget tend to reflect towards what has happened over the year and see if there are any aspects in life which we can improve on. 

Of course, it is still a bit early for that as we have 2 more months before the end of the year.

But we thought it is important to sit down and discuss some of the more important things for Mrs Budget and myself, seeing that we were recently legally married and our wedding will be happening early next year.

1. How Do We Manage Our Money

Mid way into our relationship before we became Mr and Mrs Budget, I remember that one night when the Mrs and myself sat in the car and spoke the first time about our finances. 

Personal finance is a taboo topic among all asian families and is a hard topic to broach. In view of our relationship getting more serious with talks of marriage and proposal, Mr Budget took a leap of faith and “showhand-ed” his finances to Mrs Budget.

Basically, Mr Budget brought his laptop and opened up his spreadsheet which tracks all his assets and liabilities, along with monthly expenses, and showed it to Mrs Budget. 

Because Mr Budget didn’t grow up in a family with good financial habits, it is important for him to make sure that his other half do not have bad financial habits. Mr Budget also needs to ensure that the relationship is built on full financial transparency so that we can truly make the best joint decisions.

To his joy, Mrs Budget also slowly opened up her personal finances to Mr Budget and now has her own finance spreadsheet too. Mrs Budget was intrigued at the detail (though not as detailed as other financial bloggers out there) of Mr Budget’s tracking and became an active money manager convert. 

Mr Budget also always counts himself a very lucky man because Mrs Budget is a capable woman with no liabilities and has no bad financial habits or vices (such as splurging on clothings or luxury items). 

We adopt a separate / individual net worth tracking method, where we will personally manage our own money and make any investment decisions since we are both adults, although Mr Budget will mostly be the one giving advises.

Every month, we will contribute a token S$1000 each into our joint account for household expenditure, as well as savings for our future kids fund. 

This method works well for both the Mrs and myself and we are happy to keep it that way.

Also Read: How We Manage Our Joint Account As A Newly Wed

2. How Much Are We Spending For Our Wedding

Another big topic that we discuss about was our expectation towards our wedding. 

We learn from other couples from our immediate social circle that after their wedding, they won’t usually think about what they did not do, but they would always discuss what they could have done without

And both Mrs Budget and myself subscribe to that too – we know that during the wedding, most of the guest will be Mrs Budget’s family, and our close friends. We agree that we won’t be spending on unnecessary items on the wedding, and that the savings from the wedding can be used for other more meaningful experiences.

Because of that too, we’ve decided to go with a lunch wedding, which is cheaper, and do away with wedding photography, flashy expensive wedding gown packages, expensive diamond ring or expensive bridesmaids and brothers outfit. 

Our wedding venue

At the end of the day, we truly believe that our immediate family and close friends will be truly happy for us, and that we don’t have to prove anything to anyone. 🙂 In Chinese, we know that we 心底扎实就好了。

After our wedding in January, we will probably be sharing how much we have spent so do keep a look out for that.

3. Are We Ready For Kids

This is probably the conversation that the Mrs and myself have not spoken about yet. 

Financially, Mr Budget has not done up the “kids expenditure and cost projection” spreadsheet, and because of that, there are no basis for us to base our decisions upon.

I know we will never be 100% ready financially, because there are so many variables that we need to account for – child care, child education, child expenses, and everything child related.

But it is nonetheless an important topic to discuss with your other half, and of course, make plans together for it.

For us, we are clear that we want to spend at least 1 year between the both of us after wedding, before we try to have our kids. This is also reflected in our life goals

Read Also: Our Financial Goals

4. How Can We Ensure We Can Grow Old Comfortably

Finally, one of the things I always touch upon is this – how can we ensure that we can grow old comfortably.

I think it is very important to work as a team, and that we find each other’s blind spot in our respective personal finance and see how we can optimise for each other.

Some of the stuffs that we consistently do is:

  • Keep a lookout for dividend paying equities and reits
  • Annual CPF Special Accounts Top Up
  • Active cross checking of monthly expenses
Image Credit: CPF

Which is why Mr Budget is glad that Mrs Budget is actively tracking her personal finance matters.

What this means is that, every month, the Mrs and myself sit in front of our spreadsheet together, and we reconcile the figures together – very similar as a parent checking their kid’s report card.

Every year, we will also have our projected figures, and we will compare our actual figures against the projected number and see how we are faring. 
With these numbers, only then can we have meaningful discussions about what we can do as we age and grow old together. 

Are there any other conversations that we should be having? 🙂

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What Have We Done This Month Towards Our Financial Goals – October 2019

So October has came and gone now.

While everyone else is doing a monthly portfolio update, we thought it is more meaningful to document what we have done this month towards our financial goals.

Mr Budget
Position Added: Hong Kong Land, Centurion, AIMS AMP (SG Equity)
Cut loss: Beyond Meat (US Equity)

Mrs Budget
Position Added: Lendlease (SG Equity)
Take Profit: Facebook (US Equity)

Basically adding on to dividend generating counters as well as cutting loss on non dividend generating counter, relating to what I have mentioned in my previous article.

Related article: New Investing Rule – Only Invest In Dividend Paying Companies

In terms of overall net worth, Mr Budget is still pretty much in the same position as the month before due to the cut loss position on Beyond Meat, as well as forking out a chunk of money to be used as Ping Jing for the upcoming Guo Da Li. Most of this offsets the gains in his SG portfolio as well as gains from the monthly salary.

Here’s a graphical representation of what we have done this month towards our financial goals:

For the next few months, I don’t foresee myself to be adding into any investments, as Mr Budget will have to fork out additional money for the renovation of his overseas condo in Malaysia, to be used to provide rental income as well as short to mid term investment.

If there are opportunities to sell off the condo, Mr Budget might consider doing so as the monthly mortgage for the condo might be slightly stressful.  Will probably talk about my overseas properties in the future.

So what have we done this month towards our financial goals? 

  1. Mr Budget added on S$12,000 worth of positions onto dividend generating assets.
  2. Mrs Budget added on S$8,000 worth of positions onto dividend generating asset.
  3. Started this Mr and Mrs Budget website – articulating our thoughts into words gives us clarity on our financial plans, and hopefully open up new opportunities to us in the future.
  4. Booked our honeymoon trip to Japan using miles! This will be our first ever business class experience. 🙂

How have your month been?

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Will We Quit And Travel The World After We Hit Our Financial Goals?

Both Mrs Budget and myself counts ourselves as relatively lucky. As compared to most of our peers, we have the option to plan for our early retirement, and have the means to work towards that.

We count ourselves lucky too as we are aligned in terms of how we view money, and our aspiration towards building a comfortable future together.

For myself, being financially independent means that I will have the option to do meaningful work, work that I enjoy. For the Mrs, that means having an option to leave her current comfortable but mundane job and probably spend time with our family and live a carefree life.

I always ask Mrs, that we should spend more time talking about the kind of lifestyle we want. As much as we are actively managing our finances and have a clear goal, I have to admit that we don’t have a clear idea of what we want to do after we reach our financial goals.

Are we going to call it quits and just travel around the world? 

Will that make us happy? 


But for how long? 

I envision that we will probably take a year long break to do the round the world trip with our miles accumulated, and that I will probably be bored and slightly lost after that.

There are a few (couple) bloggers in Singapore who have retired early, and here are what they have been up to:

  1. Sipping Coconuts – couple retired by age 34, travelling around the world now
  2. Thomas and wife / 15 Hours Work Week – couple, semi retired for 6 months and is now bored
  3. Der Shing and wife – retired before 40 for selling off company, angel investing now as their meaningful full time job

There are various articles around the world which revealed that many who had the opportunity to retire early (less than 40 years old), after quitting their jobs, had been facing with a loss of identity and saw their social circle shrunk, mostly because their peers are all still working. 

Because of that, while we plan for our financial independence, I don’t think Mrs and myself will be able to retire 100%. Doing meaningful work and working alongside smart people is still something that I enjoy a lot, and will be something I will be pursuing should we manage to hit our financial goals. 

For now, we have enough miles to do a round the world trip, which we plan to do so hopefully in the next 2 years before we try to have our first baby. 🙂 

However, after we hit our financial goals, which is to have a joint net worth of over S$2,000,000 by 2027, we will most likely explore some form of meaningful work so that we won’t be lost sheeps. By 2027, the Mrs will be 36 years old and I will be 39 years old!

And we have 8 years to figure out what we want to do when the day comes.