Monday, August 6, 2018

Livin' in Singapore (Money Talks!)

Let's talk about some numbers here living in sunny Singapore. I always considered Singapore a great place to live... assuming you have tons of money. 

Breaking It Down

Now let's assume you don't have that money and are, like me, recently working and looking to achieve the adult goals of home, marriage and family. Some simple numbers as of 2018 (obtained from various websites with a quick google search.)

A 4-room HDB flat, even with grants, can cost around $280,000, give or take, according to location. We have the more expensive flats in the central location and the cheaper ones around Woodlands and Punggol. 

A wedding can set you down by maybe $30-40,000,  children even more. a 2016 article by Today highlights the cost of  raising a child, which cost on average $260,000. Two or more if you can afford it indeed.

Those are the numbers if you want a child, a house, a wedding today.  That does not include good ol' inflation, which in the past 40 years averaged around 2.60% from 1962 until 2018. You may just about break even if you invest all your money into a DBS Multiplier account, or just shove the money back to the government as saving bonds. That's in a way better than putting it under your pillow, but only marginally better.

Cars. Even the cheapest cars currently cost around $80,000. Correct me if I am wrong here, with all the taxes, COE, fuel rate and stuff, its probably going to be higher than that. 

If we want the adult goals mentioned above, and assuming having two kids, it will be nearly 900k assuming we want two children in our lives messing up our sleep. Those numbers do not look good, especially since the median pay of Singaporeans in the job market is at $4,232, and that amounts to 55k. If we want the full package, it will require nearly 20 years of working just to get those things, and thats assuming we neglect every other aspect of life including eating and drinking. Not that possible of course. 

Now, I may sound extremely negative about all this, but that's not saying I am not happy to be Singaporean. There are some perks that allows Singaporeans to benefit as well. 

I especially like the lack of any taxes on investments. I for one do not need to worry about any capital gains nor dividend tax in Singapore, and that's one beautiful thing. The numbers above may be disheartening, but are entirely possible to clear and still have good savings left, if we embark on the active journey to invest and make our money work for us. 

And I guess that's what this blog is about. Knowing the numbers above, I would say there is a motivation to just hit the brakes on what we think we may want (a car? nah) and focus on how to spend our money and time wiser. It may not be easy to retire at 35 or even 40 unless there is a constant growth in our portfolio, but I would say that if one could retire even 10 years earlier just because of sound investment making, that would legitimately be worth it.

Don't waste your time. Start investing now. Pick up that book that you have been thinking about reading. Read Investopedia. Devour annual reports. Throw some money into the stock market, even as a trial, just so you know how to buy stocks. Stop thinking about doing, and start doing. 


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