Retirement Survey Results – Understanding Our Needs and How To Achieve It?

One week ago, I launched a retirement survey on my blog and said I will release the results and also write it into a blog post. Thanks to all who have done the survey. There were quite a good handful of responses which made this blog post possible. The purpose of this post is to show what other readers, like yourself, think about retirement needs and then I will provide some examples to show how we can actually achieve our targets for retirement. Let’s begin.

Survey Responses

Q1: At what age do you hope to retire?

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For the first question, most people are looking to retire at the age of 50-55 years old or 55 to 60 years old. This seems to coincide with the time we would be getting our CPF at the age of 55. I guess its also a achievable age to retire after working for about 30 years or so. There are also quite a number of people who are looking to retire at the age of 40-50 years old. Let’s see how is this possible in the later part of this post.

Q2: How much do you think you need per month when you retire?

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For question 2, people generally think they need about $2000-$3000 per month for retirement. There are mixed responses where some think they need $1000-$2000 per month while others think they need $3000-$4000 per month. I guess this depends on individual lifestyle and preferences. We will look at how to achieve our desired monthly income for retirement too.

Q3: How much savings do you think you need by the time you retire?

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For question 3, it seems like most people believe they need at least 1 Million dollars to retire. Some felt they just need about $500,000 to $1 Million.

Q4: Choose which instrument you would use in order to reach your retirement goals (Select all that is relevant):

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For question 4, most people feel they can use a variety of instruments to reach their retirement goals. Stocks and CPF savings are 2 of the best instruments which people feel they could use.

Q5: Do you worry you would not have enough money for retirement?

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For question 5, most people are worried about having not enough for retirement. I guess its very hard to know what will happen in the future so people are generally worried. However, I think if we plan well ahead and have more information on how to achieve our retirement goals, it will be much better for us.

Achieving our retirement goals

In summary, the survey results show that most of us want to retire around age 55 with a monthly income of $2000-$3000 and we think we will need $1 Million in order to achieve that. Let’s say if we start saving and investing at the age of 25, how much must we save to achieve that? How about if we start later, can we still achieve our retirement goals?

The Millionaire Dollar Grid

I came across this million dollar age grid from I love the grid because it shows very clearly how we can achieve our goals in just one grid.

This grid assumes you start with $0 and your savings are invested at a 7% annual interest rate. Let’s take for example you start at age 25 saving $16,000 a year and investing it at a 7% annual interest rate, you can achieve $1 Million dollars at the age of 50.

Even at 50 years old, if you manage to save and invest $40,000 a year, you can become a millionaire at age 65. But, do we really need a Million dollars to achieve $2000-$3000 per month income during our retirement years?

Getting the monthly income for our retirement

There are a few methods for drawing income for retirement. The first is drawing out from our lump sum savings for our monthly needs until it runs out. This is what a lot of people have done. $1 Million dollars will only last 27 years if we draw out $3000 every month.

The second method is to get a monthly income through an annuity. We pay a fixed amount of money to buy into an annuity then get monthly payments when we retire. In Singapore, all of us are enrolled into a national annuity called CPF life. Through the survey, CPF savings was one of the top choices which many of us will be using for retirement. Through the CPF life scheme, a sum of $249,000 at age 55 will get us a monthly payout of about $1860 to $2000 when we reach 65 years old. This will be paid to us all the way until death. It seems like we don’t need $1 Million to get a comfortable income of about $2000.

The only problem I guess people have with CPF is the payout age is too late. It would be better if there is some kind of payment before age 65 but I guess we would need a lot more savings in the account to get the same payout if that ever happens. Nevertheless, I still think CPF life is a good income stream for our retirement. For us who want to have some income stream before age 65, we would have to plan something additional which leads me to the third method.

The third method to get monthly income is through investing in good dividends stocks. When we have accumulated some savings, we can invest and get some income through dividends. Let’s just use 4% as a safe margin for dividends. If we have $1 Million in cash and invest to get 4% dividends, this would translate into $3333 per month for us. The problem is $1 Million may be somehow hard to achieve for some people.

The combination strategy for retirement

I’ve mentioned retirement a lot of times in this article but to me, achieving the savings or monthly income is not to retire and do nothing at all. Its all about having some freedom to choose what we want to do in life instead of being stressed at work because we have to work for money.

As mentioned, CPF life is one of the monthly income streams we can look forward to. However, it only pays out at age 65. We can probably have some plans to achieve a certain monthly income through stocks investing or other methods before age 65. Targeting to save $500,000 and invest at 4% interest would get us $1666 per month. This could probably be achieved before age 50. Once we reach age 65, CPF life would payout probably $2000-$3000/month depending on the sum we have in our accounts. The maximum amount in CPF now is $249,000 which pays out about $2000. By the time most young people, in their 30s currently, reach retirement age, the amounts should have adjusted upwards so they could be looking at payouts of $3000 or more. If you’re reaching 55 soon, you could plan to get more than $2000 in monthly payouts. The CPF retirement sums will increase accordingly to adjust for inflation.

Achieving monthly income of $2000-$3000 shouldn’t be that difficult if we use the right tools. Saving up and investing in stocks is a good way to build some passive income while CPF life also provides some stable income in our later years. If we can achieve $1 Million, it would be good but it seems like even if we did not have $1 Million dollars, we could still retire quite comfortably.

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Survey Shows Singaporeans Worry About Having Not Enough Retirement Savings

A few days back, I posted a survey conducted on my blog to show what other readers, like yourself, think about retirement needs. You can read it here if you missed it out. I then received a press release from Blackrock Global on a survey which they did on retirement savings too. I found that the findings were quite insightful so I decided to share it here:

Singaporeans are not doing enough to prepare for retirement, according to BlackRock’s Global Investor Pulse Survey 2017. The discovery comes at a time when insufficient funds for retirement has become an increasingly pressing concern worldwide, in light of today’s low-yield environment.

BlackRock’s annual survey polled 28,000 people throughout 18 markets – including 1,000 in Singapore – by asking questions on financial and investment management and the likely impact on their retirement.

Kevin Hardy, BlackRock’s Country Head of Singapore, said: “It is promising to find that Singaporeans are acutely aware of the need to save for retirement and worry about not saving enough. This mindset is essential when seeking to reduce the retirement savings gap, which is caused partly by today’s low-yield environment.”

He added: “Singaporeans’ expectation of a 5% annual investment return seems reasonable compared with their regional peers, but underestimating their life expectancy is the other caveat to address as they plan for retirement. This is especially important for women who are normally expected to live longer than men.”

Results showed 64% of Singaporeans worry about running out of money in retirement, the highest proportion in Asia Pacific. Nearly nine out of 10 Singaporeans (87%) believe they are responsible for their own retirement income. However, this realization has yet to spark action – only 68% have started saving despite the fact they save an average 15% of monthly income, the highest rate worldwide. Some 84% are saving beyond the mandatory requirement of the Central Provident Fund (CPF), or in other forms of savings plan. But it is clear respondents are underestimating how much they will need for retirement, in many cases by as many as six years.

Singaporean investment leans heavily on cash – 47% on average, which is slightly higher than in other parts of the region but much lower than the rest of the world – meaning Singaporeans may not be able to achieve enough income from their existing portfolios.

More than 62% of millennials have begun saving for retirement  

Millennials in Singapore demonstrate a high awareness of the need to save for retirement, and are concerned about outliving their savings and becoming a burden to their families.

Nearly two-thirds (62%) of millennials have begun saving for retirement, a significant increase from 2015 (56%). More impressively, 87% of those now saving are making additional investments beyond the mandatory CPF requirement. In fact, 27% (vs 24% of Singaporeans generally) are saving into private pension plans, and 22% (vs 18% of Singaporeans generally) are making further voluntary contributions to the CPF. This represents the highest proportion across all age groups in both categories.

Sentiment is generally positive amongst millennials, with half (50%) feeling confident of accumulating adequate retirement income, while 49% are confident of making retirement-focused investment decisions (scoring higher than the average among respondents in Singapore). This indicates positive investment behavior from the younger population.

Yet to fully embrace technology and professional financial advice  

Singapore is home to a technology-reliant population, with online channels (55%) being the main source of investment information before financial advisers (42%) and family and friends (39%). Although most are using technology for basic functions such as information-gathering, routine monitoring and everyday banking, a fifth (20%) of Singaporeans find technology helpful in monitoring their retirement prospects. This is seen to be providing motivation to adjust spending patterns, retirement dates, income expectations and portfolios.

In fact, 64% of Singaporean respondents are willing to buy an investment online. Of this group, nearly half (46%) said they prefer to obtain professional advice either before or during a transaction, while 36% need reassurance from a trusted brand. It becomes evident that financial advisers and technology are used as complementary sources of information when Singaporeans make investment decisions.

Hardy said: “Technology provides ease of access to information and can be a useful tool in enhancing financial knowledge – but the human component should not be ignored. Ability to harness the potential value of both technology and face-to-face financial advice will generate greater confidence in long-term investing, as Singaporeans build their desired retirement income.”

Narrowing the retirement savings gap 

It will take a long time if we just rely on savings for retirement. We should learn how to make our money grow as well to reach our retirement targets. Income is also important as if we have higher income, it makes it easier to save without having to squeeze ourselves too much.

Hardy said: “Investors need to periodically track and evaluate their progress against targeted savings goals, especially as they will likely spend more years in retirement than expected. It is important to make cash work harder by taking on some risk to generate desired retirement income. We find income-related products such as dividend-growing equities or high-quality debt to be popular among Singaporean investors. This can be a great means of delivering higher income than cash within diversified portfolios, without sacrificing asset growth.”

About the BlackRock Global Investor Pulse Survey
The BlackRock Global Investor Pulse Survey is one of the largest global surveys ever conducted and surveyed 28,000 respondents in 18 markets. In North America: The US and Canada. In Europe: France, Germany, Italy, the Netherlands, Spain, Sweden, and the UK. In Latin America: Brazil, Chile, Colombia, and Mexico. In Asia: Mainland China, Hong Kong, Japan, Singapore and Taiwan. The survey in Singapore involved 1,000 respondents. The survey took place in January and February 2017 and was executed with support from the TNS Group, an independent research company.


What drives stock price volatility and how can I profit?

The Singapore Stock Exchange (SG) has been in a downswing lately and has also seen some volatility. This doesn’t mean there is a lack of profitable opportunities for investors – it simply means that they need to understand how to anticipate and profit from stock volatility.

That entails gaining an understanding of what is driving prices, so that the investor has an insight into why a stock’s price is rising or falling.

Financial results always causes volatility

One of the key drivers of volatility in a company’s stock is when the company reports its financial results. Some companies report quarterly, others half-yearly or annually. Companies often have surprises in the reported figures – both on the upside and the downside.

All stock exchanges and internet forums generate a lot of discussions and speculations, so before the actual results are announced, prices often move sharply, in reaction to the latest rumour about what the results will show.

Surprisingly, the volatility sometimes continues for a few days after the results are out – this is largely due to portfolio managers adjusting holdings, given the numbers that have actually been reported.

And of course, the market often overreacts, so that a swing in one direction or another is followed a few days later by a swing back in the other direction. Observant investors who are following key Singapore Exchange stocks, can develop a feel for when to buy and sell, to take advantage of this volatility.

August 2017 Financial Results

Property companies are definitely doing well, in fact six out of the ten best performing stocks this year, are real estate stocks. After the government relaxed some development restrictions, analyst are forecasting a continuing rise in real estate stock prices. UOL Group, City Developments and others are leading the charge.

In the August results reporting, one of the stocks that saw price swings around the reporting dates was Singapore Airlines which had a moderate 5.6% year-on-year growth in revenue in the passenger business but strong results from the cargo unit. 
However, this was put in the shade by the Hotel Properties limited (HPL) result – the company reported profits up 23%. And after a 77% rise in profits in Q1, Capitaland, Singapore’s largest property developer, followed it up with a doubling of operating profits in Q2. 
Analysts reports are worth reading
It’s well worth reading the analysts’ comments on these companies when they report. There is often background information that can help you understand whether the result is caused by special accounting measures or unusual trading conditions, or whether the company’s performance is likely to be sustained. These two different scenarios are vital for knowing whether the share price is going to be underpinned and steady, or very volatile. Market expectations that a company will constantly outperform are difficult to meet, and disappointment from investors at a missed target can result in the share price dropping.
As a private investor, you can take advantage of these volatility using a spread trading account that allows you to profit from price falls as well as price rise. However, be careful to choose a well run broker, such as CMC markets

Global environment always influences volatility
All stock exchanges are now part of the global information flow, and Singapore is no exception. Investors don’t like international tension, such as the situation between the US and North Korea. They also dislike uncertainty, such as how far US interest rates are likely to rise. All of these factors add to volatility.
Price volatility is always greater before key Federal Reserve announcements or major US economy statistics such as the non-farm payroll data released each month. 

Mergers and Acquisitions (M&A)
M&A activity, even when it’s based on rumours and hotly denied by the parties involved, can send share prices into overdrive. But Singapore has seen a slow start this year in terms of M&A activity. Some property deals have taken place, but nothing like the contested takeovers that really encourage price movements, on the back of the uncertain outcome. 
The investor who carefully observes these market fluctuations can start taking advantage of highly volatile prices to make excellent profits.
*This is a guest post


Optimising Joy In Spending

As people who are embarking on the path to financial freedom, sometimes we may be too hard on ourselves when it comes to spending. Recently when I looked at my credit card statements and realised I’ve spent more than I should, I can’t help to think if I’ve lost track in my financial journey. But upon closer look at my financial situation, it really doesn’t hurt to spend a bit more. A few hundred dollars more spending doesn’t really hurt much, does it?

As a financial blog, I’ve been writing a lot on save save save. But perhaps, we could derive joy from spending and still achieve our financial goals. How can this be done?

The secret is in optimising our joy in spending. When we tell people who have trouble saving money to cut down on their expenses, it can be hard. People would say “Why you save so much just to bring it to your grave?”, “Isn’t it miserable not to spend?”, “If we save so much now then what if something happens and we can’t even use the money already?”.

Let Joy drive your spending

Let’s be honest, there are some things we derive joy from and some things which we don’t. Somehow, even if we don’t derive joy from, we still spend nevertheless. For example, you’re an introvert and you spend your money going to bars which you don’t really enjoy. However, you like going to the gym but because you spend most of your money going to bars, you don’t have much left for a gym membership.

Or if you love travelling with your family and friends but because you bought a new car which you don’t really need which results in you needing to pay a huge amount for the monthly instalment that you do not have much left for a vacation. In this case, it would be better to find cheaper alternatives for transportation and free up more cash for overseas trips.

Also, maybe we have signed up for various cable TV channels but we don’t even watch TV much? This money could be spent better elsewhere such as going for a nice meal with your loved ones.

The key is to optimise joy in spending by deriving joy from it. It sounds simple but you’ll be surprised many people spend money on things they don’t enjoy at all.

Optimising Joy In Spending

Many years ago, I heard a saying that if you can buy things without looking at the price tag, that’s the time you have reached financial independence. However, I’m sure most of us here still look at price tags before we purchase stuffs else we’ll be broke by now.

I try not to look so much at price tags now but at the quality of the product. Even if I see something as “expensive”, I will think about the quality of it and whether I do derive joy from this spending. For example, a holiday may be “expensive” if we travel on a non budget way. Taking Singapore airlines is more expensive than taking budget airlines but the quality and comfort is a vast difference. Going for a better hotel may cost us a lot more but the comfort of our family and the experience will make it worthwhile.

It has been proven that spending money on experiences brings us more longer lasting joy than buying stuffs. We may have bought some gadgets and forget about it 1 year later but the experience and joy of travelling with our loved ones can still be felt even many years later. Think about the last happy time in your life. It probably is some experience you had with your friends and family isn’t it? Now, think about the clothes or gadgets you bought last year, can you still feel the joy of buying it? Probably not.

Action time

Now, for your own life, are you able to optimise joy in your spending a bit more? Why not review the ones which doesn’t bring you much joy and channel the free up cash into things that bring you more joy? In this way, we could be even happier prioritising on the right stuffs.

Lastly, remember that spending money on experiences brings us more long lasting joy. It could be a good family meal, a meet up with friends or a vacation with our loved ones. We will certainly remember the experiences we had even many years later.

Let’s optimise our joy in spending!

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5 Lessons I Learnt From Those Who Have Achieved Financial Freedom

Let’s be honest, all of us want to be rich. I started my financial journey many years back by finding out how the rich manage their money and how exactly I can do it like them. However, most probably, the information you’ve been finding is all directed at the super rich. How about common people like you and me? Are we able to have a little more money so we can not worry about it anymore?

Throughout the years, I’ve had the opportunity to meet and speak to people who have became financially free. Every time I talk to them, I learnt something new and truthfully, its not as complicated as we thought it would be. In this article, I will list down the lessons I learnt from my interactions with these individuals who have managed to get out of the rat race.

Lessons I Learnt From Those Who Have Achieved Financial Freedom

1. Financial freedom is not just about saving money

The first lesson I would bring out is that financial freedom is not just about saving money. Oh wait, do you mean I don’t need to save money? That is not true either. I’ve seen people who have achieve financial freedom as a single person, as a married person and even as a person with kids. When I look at their lifestyle, certainly it is not just about saving money.

Most of the time, we start off our financial journey frantically saving as much money as we can. However, in our younger days, we would realise it is very difficult to save money not because we spend too much but because we have limited income. As our income increases, we would find it easier to accumulate wealth. This brings me to my next point.

2. Low income is not easy to achieve financial freedom

Income is an important equation in financial freedom. To put it simply, if we earn $2000, saving $1000 is 50% of our salary. But if we earn $4000, saving $2000 is 50% of our salary. It is impossible to save $2000 with only a $2000 salary.

Therefore, it is important to focus on upgrading our skills to increase our income. When we are younger, we should focus on getting more experience so our value becomes greater and greater. If we are unable to go up the corporate ladder, there are many other ways to create more income through part time business and freelancing etc.

3. Cash must always be flowing

Another lesson I learnt is about cash flow. The reason why its called cash flow is because it must be flowing. In business, if cash flow stops, the business is in danger. This happened to several oil and gas companies who could not generate enough income to redeem back the bonds they issued out. In our personal lives, this is liken to having not enough income to sustain our lifestyle. This could be due to overwhelming debt because of poor financial management or just pure overspending. It could also be due to not enough income or not enough cash to sustain our life if we lose our jobs.

4. Make your money work for you as early as possible 

This point is about investments. When I speak to those who have achieved financial freedom, they would always say that I’m still young and its the best time to grow my money now. Then, when they talk about investments, its always not about the hot stock or the best tips but about the most boring and routine investments they keep doing over and over again.

The safer the investment, the better it is. That’s the wisdom I learnt. It can be so safe that they even recommend putting your money into CPF to get the 4% interest which is sort of guaranteed by the government. For stocks, we just have to buy low, get dividends and sell high. One strategy I’ve heard again and again is buying into stocks at an attractive valuation, selling partially when its at a fair price and then buying back again when it goes back down. This is like keeping a base of your capital in the stock and then trading around it over time.

5. Live off dividends and you’ve reached financial freedom

Many have stopped working because they realised they could survive on stock dividends alone. This is the path to financial freedom. We must know that achieving this is not by buying into the stocks in just a few days or a few months. In most cases, this takes many years to build, buying into opportunities when it comes. For example, some of them have stocks in their portfolio which they bought at such attractive price that the dividends they received have covered their initial cost and they are still getting dividends until now.

When crisis strikes, the dividends can be more than 10% when the stock price is very low. This happens for most Reits during a crisis. If the company survives the crisis, the price recovers and dividends increases as well. Its such a good investment that you won’t even have to sell the stock ever again.

Financial Freedom Is A Journey

There you go, 5 lessons I learnt from those who have achieved financial freedom. The last and final wisdom I would like to share is that financial freedom is a journey. It certainly takes time and patience to stick with what we have to do. We should never think of getting rich quick as it could land us into a much worse state than what we can imagine.

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The Two Japanese Reits Which Got Acquired – What Can We Learn From This?

It has been a fruitful journey investing into Japanese Reits for the past few years. Saizen Reit was the first Japanese reit which was acquired earlier before. Recently, Croesus retail trust, a Japanese reit which owned Japanese shopping centres was also successful acquired just last week. What makes them so attractive that both reits from Japanese were bought over at a premium price?

I’ve written extensively on Croesus Retail Trust as early as back in 2013. The timeline of the posts are as follow:

The purpose of the sharing of the previous posts is to look back at my thoughts and why I invested in Croesus in the first place. Time pass very fast. 3 years plus just went past like that. As you can see, in April 2015, I went for a Croesus retail trust retail investor day where I manage to hear from the top management of Croesus itself. I wrote in my blog that I was happy with what I heard and the management knows what they are doing. As soon as a rights issue came, I immediately subscribed to it to increase my holdings in this investment.

Last week, Croesus was acquired at a price of $1.17. My average price for the reit is about $0.80. This represents a gain of 45%+. Including dividends, the total ROI for this particular investment works out to be about 81%. It was a long journey nevertheless.

What caused the Reits to get acquired?

The most important lesson is to find out what cause the reits to get acquired and hopefully we can always buy into the right companies which generates value for shareholders. In the case of Croesus, when I first invested in it, it was purely base on the fact that the Japanese government was aggressively trying to expand their economy through quantitative easing. They had a target of 2% inflation back then when Japan was facing decades of deflationary economy. Noticing that this was an opportunity, I went to search for companies which deals with properties in Japan. Saizen Reit and Croesus came up as an investment choice.

Next, I looked at the stability of its income which is important for a reit or business trust. Saizen reit was in the residential rental business so it was really stable. It was rare for a reit to be in the residential business. Croesus on the other hand is involved in shopping centres which had some risk in itself. However, upon a closer look, Croesus management were quite committed in achieving good value for shareholders through the many positive rental yield acquisitions and AEIs. They were committed in keeping the company’s balance sheet healthy also.

Finally, the Japanese reits was trading at an attractive price which was below their book value. Many of their properties were valued conservatively when you compare their properties valuation against the other nearby properties. Furthermore, Japanese real estate and rental prices were going up steadily over the years which was an added positive development. All these attracted other big investors to offer attractive prices to takeover the 2 companies. Sure enough, it happened and shareholders got rewarded.

There will always be more opportunities in the future for those who missed it. For fellow shareholders of Croesus retail trust, congrats to all!

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What Happened To Comfortdelgro? – The Taxi In Distress

Comfortdelgro has been on the hot seat for the past few weeks with share price dropping to a low of $1.98 now. Grab and Uber seems to have an upper edge in this taxi business competition. It is crucial to review Comfortdelgro’s business at this junction to see what it is really worth. Separately, it didn’t manage to get the new Thomson East Coast line which could have boost its operating profit by about $12-$18 Million a year. Let’s take a look at its different business segment and break it up to see what it is really worth.

Public Transport Services Business

This is essentially its core bus and rail business segment with revenue at $1147.8 million and operating profit at $86.2 million for 1H 2017. If we annualised the revenue, assuming this segment continues to grow at the same rate, we should see revenue at $2294.2 million. For this segment, there will also be contribution from DTL-3 which will be opening in October 21 this year. If we assume their ridership to double which adds about 200,000 ridership daily, the revenue contributed for this FY will be around $8 Million. 
We should see operating profit for the full year at $177.3 million. 
FY2017 Operating profit: $177.3 Million
Taxi Business

This is the tricky part to analyse but I will try my best to make sense of the numbers. Revenue stands at $618.5 million and operating profit at $72.3 million for 1H 2017. The fleet size of comfortdelgro is about 15,472 as at July 17. This is down from the fleet size of 16,821 in 2016. I estimated the rental of each taxi to be $120/taxi per day. At this junction, the taxi business is estimated to shed $59 million in revenue for the whole FY2017. 
The estimated revenue drop for Singapore’s taxi business alone will be around $59 million. There are still other countries’ taxi segment which may also face headwinds. If we assume a $70 million drop in revenue, full year FY2017 revenue should come in at $1270.8 million. 
Assuming total cost stays the same as FY2016, operating profit should come in at $97.5 million.
FY2017 Operating profit: $97.5 Million
Bus Station

The bus station business should remain stable. 2Q 2017 profit came in at $3 million. Annualised this, we should see a profit of $12 Million for FY2017
FY2017 Operating profit: $12 Million

Automotive and Engineering

This segment will see a decrease as lesser taxi fleet size means lesser servicing revenue also. 2Q 2017 profit came in at $11.4 million. Annualised this, we should see a profit of $45.6 million. A further reduction of taxi fleet will put pressures on this segment moving forward. So a conservative profit of $45 Million can be expected. 
FY2017 Operating profit: $45 Million

Inspection and Testing Service

This segment should remain stable too. Profit for this segment should come in at around $30 Million for FY 2017. Q2 2017 came in at $7.6 Million. 
FY2017 Operating profit: $30 Million

Car rental and leasing

Car rental has been facing a lower leasing fleet in Singapore and China. The profit should be about $6.4 Million for FY2017.
FY2017 Operating profit: $6.4 Million

Driving Centre Business

This segment should remain stable. Profit for FY 2017 should come in at $11.2 Million.
FY2017 Operating profit: $11.2 Million

Total Value of CDG’s business

Now, we can add up the different segments and get the FY2017 estimated profit to derive the actual value of the company. Total operating profit for FY2017 should come in at $379.4 Million. This is 17.9% lower than in FY2016. With this, profit attributable to shareholders should come in at $246.6 Million. 
With outstanding shares at 2162.8 Million, EPS will be estimated 11.40 cents for FY2017. With this EPS, PE ratio will be 17.37 at current share price of $1.98. 
To put things into perspective, if the taxi fleet decreases by another 2000 for the next few months, EPS will be about 10.4 cents. This means the PE will then be 19.04 at current price of $1.98. Looks like at current price of $1.98, it will only seem fair if taxi fleet does not drop too much again. If taxi fleet continues to drop drastically, the situation can get much worser. 
Business times had a very good article on Comfort Delgro valuing its business at $1.70 if we exclude the taxi business. This is using a simplistic 20 times multiple of net profit. Of course, this will only happen if all Comfort taxis disappear from the streets once and for all which I don’t think will happen at least for now.

It is also interesting to note that despite all the competition, the average daily number of taxi trips only slightly decreased by about 1 trip per day as compared to 2016. Comparing to 2015, the average daily number of taxi trips decreased by about 2 trips per day. Average daily number of taxi trips stands at 17.8 for one shift taxi and 27.5 for two shift taxi as at July 2017. This means that taxi drivers can still earn quite a decent income even with the fierce competition from private hire cars. 

There are many factors to consider in this investment and it is definitely not for the faint hearted. From my perspective, Comfortdelgro’s taxi business should still continue to exist in Singapore but probably at a smaller market share in the future. It would be quite hard for it to go back to its $3 stock price value as the market adjusts itself to consider the future value of the company. For grab and uber, it is still an unknown how long they can keep offering discounts and burning cash month after month. How the taxi industry will evolve in the future will be for all to see.

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Money Hacks To Make The Best Out of Your Money – Part 1

Money comes and go like a running tap water. However, we can always make the best out of our money by using a few simple hacks which I’ve done over the past few years. I believe this has significantly added to my savings and at the same time I still continue to enjoy the finer things in life.

Some of the hacks I employ includes:

1) Enjoying higher bank account interest

2) Getting cashback on my spending

3) Finding the best deals (Dining, movies, shopping etc)

4) Travelling smartly

Let me share in detail what I do to make the best out of my money which you can too to make the best out of yours!

Enjoying higher bank account interest

Since 2005, I started putting my money into higher interest account because the banks in Singapore just slashed their interest rates like nobody’s business. Since then, I’ve switched a few accounts here and there because interest rates in the accounts changes over the years too.

For now, my 2 main high interest accounts are from OCBC and CIMB. OCBC 360 is easy to use and we just need to meet 2 criteria to enjoy 1.5% interest rates on the first $70,000 in the bank account. I just need to credit my salary and also pay 3 different bills to get the 1.5% interest rate. This is easily an additional free $1050 for the year.

Above $70,000, I put into CIMB fast saver account to earn 1% interest on the first $50,000 and then CIMB star saver to earn 0.8% on any balance. The best is there is no conditions to meet for CIMB so its very straightforward. It is very easy to open too just need to do everything online without the trouble of going down to the bank.

Possible extra cash savings: $1000+ a year

Getting cashback on my spendings – Free $150 Grab Gift

I started using cards to get cashback on my spending when I heard a friend say how he had a debit card which gives 2% cashback on all spending. I went to apply for it and used it to pay for my university fees where I got hundreds of dollars in cashback as a result.

Nowadays, its hard to find a debit card which can give good cashback. One of the debit card which gives cashback is the DBS visa debit card which gives 5% cashback. However, you have to use visa paywave for your payments and have to keep withdrawals from the ATM at 3 times or lesser. For me, this is very hard to achieve.

So, I signed up for some credit cards which gives good cashback for my spending. This is easily done for those who has a stable income. If you’ve started working or have been working for awhile now and do not have any problems controlling your spending, getting a credit card is more beneficial than not having one.

My favourite cashback credit cards is still the Standard Chartered Unlimited card and American Express True Cashback card. Both gives 1.5% cashback on ALL spending (online or offline) and 3% cashback for the first 3 months for the AMEX card. Getting credit cards has even more perks because often there is good sign up bonus. For example, I got $138 credited into my card when I signed up for the SCB unlimited card and additional $100 vouchers.

There’s also a new credit card that gives 2% cashback. This is the Standard Chartered Spree credit card. There is no minimum spend and 2% cashback is given for all online and contactless payments.

Currently, there is promotion to get $150 Grab gift for many of the credit cards below. Promo ends 15 Nov 2017.

There are many other cards available too. Click on the image to apply and grab your Grab Gift:

*Note: Grab Gift only applicable when you apply through the above links

Possible extra cash savings: $150 gift + a few hundred dollars cashback

Finding the best deals

There are many deals I’ve found out over the years which is so good sometimes I don’t believe its true. Fancy some 50% off for your dining? Special discounts for movie tickets? Or half price for your shopping? All these are possible with just a touch of your fingers.

Most deals are found online now. For dining, some of the best websites to make reservations is Chope and Eatigo. For Chope, they give 100 Chope dollars for very reservation made. Just 400 Chope dollars and we can exchange for a $10 restaurant voucher. That’s $10 off for every 4 reservations only.

The best is still Eatigo which is a dining reservation app that gives up to 50% off your total bill for the restaurant you book at. You can get 50% off for a buffet at Swissotel The Stamford or fancy 50% off for some Michelin star restaurant at Marina Bay Sands? All these can be done using Eatigo to book your reservation.

There are many restaurants on the website which you can look through. Many people are paying the full price for their dining but you can enjoy the same meal for just half the price at the same restaurant. That’s the smart way of dining.

Possible extra cash savings: $100+ for each meal

There you go, 3 simple money hacks you can start to make the best out of your money. Part 2 will go more detail into money hacks for movies, shopping and travelling. Stay Tune!

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Money Hacks To Make The Best Out of Your Money – Part 2

Money Hacks is a 2 part series to share about the deals which I used to make the best out of my money. Read Part 1 here.

In Part 1, I shared on the high interest bank accounts, the cashback cards and also the dining discounts which I can get. In part 2, I will write about the deals for movies, shopping and also how to travel smartly.

Finding the best deals – Movies and Shopping

For movies, here are a list of discounts for 3 of the main cinemas in Singapore:

Golden Village Cinemas

HSBC’s Movie Card – $7.50 weekday movie tickets, $9.50 weekend movie tickets

DBS GV iCard – $7.50 weekday movie tickets, $11 weekend movie tickets

Shaw Theatres

Safra Card: $7.50 weekday movie tickets, $10.50 weekend movie tickets and 1 for 1 weekend tickets (for first 500 redemptions per day only)

M1 Customers: 1 for 1 movie tickets on Sunday (valid for first 450 customers only)

Cathay Cineplex

Mastercard – $8 weekday movie tickets, $10.50 weekend movie tickets (not valid for online bookings)

Singtel Customers – 1 for 1 movie tickets every Thursdays (valid for first 500 customers only)


For shopping, a good website is Shopback to get cashback. You can get cashback on all the popular stores such as Taobao, Qoo10, ebay, AliExpress, Lazada, Shopee and many more. There are many other popular stores too which includes food panda, Expedia, Agoda etc

What’s more, you can use my link to get $10 free when you sign up. Sign up here to get your free instant cashback.


Many of you should have heard of Carousell where you can buy and sell stuff. Its getting so popular that I’m hearing more and more people use it. Besides selling your stuff, many people actually buy things from there too. You can get some good stuff just searching around and most of the time its much cheaper than what you get in the retail shops.

Ezbuy is an online shopping portal which brings you the stuff from Taobao without you having to buy your stuff in RMB. There are quite a lot of stuff available for sale and its fairly easy to use. For delivery, you can choose either to deliver straight to your doorstep or choose a location near your house. This can save you quite a lot of delivery charges.

Travelling Smartly

For travelling, the 2 biggest expenses will be the air tickets and accommodation. Let’s talk about air tickets first.

Air Tickets 

For comparison of the best air tickets, you can use skyscanner which will instantly compare for you the cheapest air tickets across many airlines. In just less than a minute, you can get the best deal for your flight tickets instantly.

However, air lines do not offer promotions all the time so its crucial to know when the promotions are offered. There are a few ways to keep up to date on the promotions. Firstly, you can follow the different airlines on their Facebook page and also subscribe to their newsletter. For Scoot, they seem to offer special rates on Tuesday and for Jetstar, its on Friday. Full fledge airlines such as Singapore airlines do offer promotions too and it can be quite attractive once they have it. Another website to follow is which always have the latest deals updated on their site.


For accommodation, there are more choices now as compared to the past. Besides staying in the traditional hotels, there is airbnb where you can stay at someone’s else home. If you’re going on a trip with your family, you can actually book the whole apartment with kitchen, living room, bedrooms all for yourself. I’ve stayed in a few before and its quite an unique and fuss free experience. Just remember to check the reviews to make sure its good before booking.

For hotels, we can use to compare for the best hotels. You might have used Agoda or before but now with Trivago, they instantly compare against many websites (including agoda and for the best hotel deals. Its the best “skyscanner” for hotels.

Regardless if its getting higher interest on your bank account, cashback for spending, shopping, dining, watching movie or even travelling, there are money hacks which we can use to make the best out of it. With the power of technology and the rise of comparison portals and sites, it makes it easier to get the best deals now.

P.S: I’ve started a comparison portal on my blog too to allow you to compare for the best deals. Check it out here

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Multiple Streams of Income Through The Gig Economy

This year, I’ve been seeing more news on the gig economy. Think of flexible working hours, doing what you love, be your own boss and freelancing. These are all part of the gig economy. In Singapore, about 9% of the workforce here are in the gig economy. That is still not a lot as compared to countries like the US having 30% of their workforce in the gig economy.

Interestingly, an article on the Straits Times said that “about 47 per cent of Institute of Technical Education, 35 per cent of polytechnic and 10 per cent of university graduates went into part-time, temporary or freelance jobs last year – more than double the share from a decade ago.” More and more young people choose to have freedom in their work instead of going into full time work in the corporate world.

Do You Like Your Job?

More often than not, we hear people saying things like Monday blues, cant’s wait for weekend to come, tired of working or I hate my boss. All these are signs that a majority of people don’t really like their job but still have to work in order to survive. This is a stark contrast compared to those in the gig economy where a great majority enjoyed their work as freelancers.

I’m not suggesting that you quit your job right away and go straight into the gig economy as its still a risk to forego your stable monthly income. However, there are some ways the gig economy can benefit us to reach financial independence earlier so we do not have to work for the sake of working anymore. Does this sounds good to you?

How The Gig Economy Can Benefit Us?

The gig economy is getting larger and more connected now that it is easily accessible to most of us or in fact all of us. In Singapore, it is estimated that about 1.5% of the workforce are ‘secondary’ freelancers, meaning these workers freelance part-time alongside other jobs and would include students, housewives or retirees who take on side jobs for additional income.

When I was in town for work, I often see many students riding on their bicycle or e-scooters with a big bag. The names on these bags are familiar, Uber Eats, Deliveroo, Food panda are some of the most common ones I’ve seen. All these are young students earning some extra pocket money.

Then, there’s Uber and Grab where many of them are doing it part time apart from their full time job. I heard drivers can easily earn a few thousand dollars extra just by driving part time. There are even more freelance jobs online. Just a search on Google and you can find any jobs which matches your skills and you can get paid doing it. Some of the categories can be seen below:

I also recently saw some advertisements on a crowd sourced tuition portal called Tueetor. There, you can be matched to any students who are looking for tuition that matches your skills. You can earn some extra money by teaching others. I’ve not tried it before but it does looks good. There are so many requests on the website which we can see from the map. Its like the Uber and Grab of Tuition.

Multiple Streams of Income Through The Gig Economy

I suppose the gig economy will continue to be more popular as people become more aware and savvy on how to take advantage of it to increase their income. This is like a dream come true for those who always wanted to build multiple sources of income.

I personally already have a few friends who are in the gig economy. They can potentially earn double of what the average person of their age are earning. However, as mentioned earlier, it can be risky to quit your job and go straight into the gig economy, though we can start on the sideline first and see how it turns out. If you can offer value, people will be willing to pay for your services.

We can also accelerate our goal towards financial independence through the gig economy. With higher income, it makes it easier to achieve our financial goals and one day we’ll realise we have got out of the rat race. Rather than working in a job which we hate for the rest of our lives, we can make some plans to have more freedom and happiness in our life.

*If you’re interested to create your own financial plan, do check out this article which I’ve written previously. Also, check out how you can retire in 7 years in this article

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