Drinks and Party - what's your indulgence?

So it was TGIF yesterday, and after a hard and gruelling work at week, I think all of us can related to letting our hair down once the weekend rolls around.

However, due to time-table clashes, I was not able to join my friends for a Friday night of drinks yesterday, and from the group chat that I saw this morning, the bill per pax averages out to between $150 to $200. I do hang out with them sometimes, and I would say that's the average amount each shells out for a night of 'catching-up'.

As I started my trip back to financial independence last year, I have used YNAB, and my monthly allocation to personal dining out is only around 200-400 per month. I would say 1 night out with them would blow my entire month's budget. So in that sense, I have now preferred to have cheaper alternatives like house parties etc, where you can still drink (if you want to), but at a much cheaper rate. [I hope they do not read this entry!]

I think everyone have their own indulgence of choice. I use to have more indulgences I think, but I have learnt to cut down some to get my budget in order.

Café-hopping - those Instagram worthy moments with oh-so-lovely food. I know there are some people who do café-hopping every weekend

Fancy restaurants - A friend of mine don't drink tap water at restaurants, and always order sparkling. That's at least $6 just for plain water at meals.

Transport - There are some who swears by taxi every where they travel. Each trip could be around $20 - 1 month? around $1,000 I guess.

Shopping - enough said.

Hobbies - Some folks travel once every two months.

Of course, I have the largest indulgence to support, my car. I guess that's why some things have to go!

I won't call it a sacrifice - some things I do not really enjoy. I like hawker food over cafes anyway, kopitiam kopi to fancy Americano. I do not think my quality of life suffered, and I do feel that my money is spent on more meaningful things (like my retirement fund)

I guess, as long as 1 has the budget, and has a well worked out resource allocation plan, one should feel free to indulge in whatever they want to. After all, life is short. If you do not have an interest or two to indulge in - what's the point in living?

Spend on yourself in the present, but don't forget to spend on yourself for the future. :)

Update Feb 2016

In addition to recording my transactions, I also decided to track down on a monthly basis, how much passive income i receive from dividends

Total of $815 for the month of February. Given that i only hold 15,000 STI ETF shares, seems like February is a good income month for me.
The yield of the ETF is around 3.5% to 4% at this current price now.

Also elected to receive dividends in the form of scrips for Frasers Commercial Trust since i do not need cash at the moment, so might as well reinvest it back in.

Added 500 shares to my STI ETF for this month, at a price of $2.65. A lot of people are avoiding the markets given the volatility, but my thinking is that if i am comfortable buying in at $3.30, i should be even more comfortable buying in at a lower price.

Gonna be adding positions on a regular basis going forward!

Windfall

Well, sad to say, i did not turn into an instant millionaire following my previous post - 12-million Hong Bao draw.

I did have a consolation 'prize', as my company announced the year end incentive award (or bonus). So with the windfall (well, being able to keep my job is already good enough for me!), any bonus award can really be considered a bonus.

As with any windfall received, adequate planning is required, otherwise it will all be squandered away. Many stories on the net about people spending their inheritance within a month!

So i took the opportunity to plan out what to do with the excess amount that i will receive, and came to the conclusion - money will never be enough. No matter how much i have, i will be able to find ways to fill it up.

I will sock away 40% to my household account, and build up my emergency cash. 

The emergency cash is in line with my resolution for 2016. See Goals 2016. Given the current economic climate recently, i guess it is better to be conservative on my part to increase my buffer.

I will also take the opportunity to replace my fixed assets, namely my laptop, which has been with me for the past 6 years. 

Other non-savings expenses include allocating the bonus to my annual travel plans, as well as other expenses like giving a bonus to my family as well.

My regrets in coming up with this budget? I did not manage to allocate to 2 categories:

(1) Increasing my personal war-chest. I guess that would come with my monthly salary instead.

(2) Accruing for the tax on this bonus. Again, it would have to come from my regular budget.

What about you? I hope you have had a windfall recently as well. :) and please do share with me how you intend to allocate them.

12 million Hong bao draw

Would you be buying a dream by 'investing' in a lottery ticket for the $12 million Hong bao draw?

*correction - should be $13.9 million instead!

Some financially savvy folks are saying that they might as well save the money and invest it for the long term, since that is a more sure-win bet.

Me? I won't hesitate to admit that i would be one of those buying a hope and a dream. To me, that amount won't cost me my financial freedom, at the most, it's only the cost of a lunch.

And are the odds really stacked against me? 

We can say it is 50/50, since there is only 2 outcome - either we strike, or we don't. [Just kidding!]

Singapore pools kindly disclaimed that  the odds of winning the jackpot is 1 in 13,983,816.

Odds of winning Toto 

Given the winning prize is $13.9 million, what's the payoff? 

The payoff for a $1 dollar bet would be is [1/13986,816]*13,900,000, which is approximately close to 1!

Why wouldn't i buy a dream with $1?

Of course, assumption is that there is a sole winner (although in such cases, there are usually multiple winners, and the prize money are split a couple ways)

This is a post made in jest - no way am i encouraging people to gamble!

Happy New Year!

Wishing everyone a prosperous new year!

May the year of the Monkey bring great health and wealth to you.

What is the monkey's abilities?

Monkeys are agile, quick and very nimble. My wishes for us is to be as agile and nimble as the monkey. When the opportunity comes (or we are already in a time of opportunity), be agile and nimble to take advantage of it to have many prosperous years ahead.

And of course, stay healthy! For health is indeed wealth.

Consolidating bank accounts

One more step in organizing my personal finances. I closed my UOB savings account and consolidated it with my UOB One Account to earn higher interest rates.

Why did i open up the savings account in the first place?

(1) I have the concept of 'paying myself first'. Instead of the formula. 'Income - Expenses = Savings', i try to adhere to the formula of 'Income - Savings = Expenses'. Having that separate account allowed me to transfer money from 1 bank account to the savings, so that i wouldn't touch it.

(2) I'm also quite compartmentalized. So if i designate 1 account for savings/investments, it feels much more neater to me from an accounting perspective. Dividends from investments goes into that account, and EPS to the various brokerage accounts i have are also directed into it.

Why did i have it closed now?

(1) I don't really need it now. All i actually needed was a way to keep and budget the money away, even if it's in a single bank account. As you may know, i use YNAB, and YNAB allowed me to budget my savings/investment money (as well as other expenses categories) so i wouldn't accidentally used it.

(2) The savings account i have generates next to nothing in terms of interest. By consolidating the money into a higher yielding bank account, the money is 'working' harder in generating extra returns.

It really is quite troublesome, changing bank accounts. Sending hard copy forms for the closure and linkage forms for, and changing bank account for the CDP direct crediting services.

I went through the process once for changing GIRO for my recurring bills, and thankfully, this process is much easier and less troublesome.

Happy to take one more baby steps to organizing my finances. Organised my credit card to get more rebates, and now bank accounts for higher interest.

More steps to come!

If you have any ideas, please do share with me :)

Save more for a rainy day

Had a lot of uncertainty as my company was finalizing the corporate strategy over the last few months, and it was finalized a few days back.

The result? A retrenchment exercise a few days earlier. It's my first experience of seeing colleagues just disappearing from office. A call from a conference room, a chat with the line manager and HR, and off you go. Sounds cold and harsh but that's the way it is. Office appears colder and quieter in the aftermath.

Supposedly the package offered is reasonable. Not very sure, as the 'chopped' workers did not return to their desk to speak with us after the conversation with HR.

Had a couple of thoughts going through that day.

(1) Wonder how those foreigners on employment pass cope - without a job, they need to leave the country in a month's time.
(2) Grateful that I wasn't on the redundant list
(3) If i was made redundant, how long would i need to get another job in these economic climate?

Guess it was at thought (3) that it really strikes home that you really need to have a buffer of emergency cash in case an unfortunate incident happens (even though there's a redundancy package). Also, multiple source of income is crucial. We should not be overly reliant on 1 source of income, or an employer, and having adequate reserves is most important.

Ultimately, my wealth is my business. No one cares about my personal finances more than myself.