Build a bigger retirement fund with CPF-SA (UPDATED).

Young working adults could use their CPF-SAs to grow their retirement funds, risk free, at a faster clip.  

This is a valid and relatively fuss free approach to long term wealth accumulation.

If you think that the additional 1.5% per annum paid on the CPF-SA does not amount to much, I would encourage you to read a blog post of mine written more than two years ago. 

In the last few paragraphs, I explained how transferring funds from CPF-OA to CPF-SA could significantly boost returns.

See: 
Do you want to be richer?





The additional 1% interest paid annually on the combined first $60K in our CPF accounts is another strong incentive for us to use our CPF accounts to grow our retirement funds.

If you are interested to know more, go to the comments section of the blog post:

Want to be wealthier without higher risk?

For risk free, long term savings with significantly higher returns, the best option for average Singaporeans is still the CPF-SA.






Other related posts:
1. SRS, CPF-OA and CPF-SA.
2. SRS: A brief analysis.

Protect your iPad mini.

Thinking of protecting your iPad mini from knocks and don't want to spend too much money at the same time? How does US$3.81 sound to you?

Yes, for only US$3.81, you will get a TPU shell for the iPad mini! Free shipping!

It comes in various colors too!

 

Shop online at:

 and search under New Arrivals.

You can't miss it!

Related post:
Save money with low prices and free shipping globally!

Category A COE hits record $77,201!

The premium in Category A, for cars below 1,600cc, surged $6,200 in the lastest bidding exercise, surpassing the previous high of $73,501 set in early August.

Easy financing is contributing to continuing demand. "Demand is still there, even as the economy slows down, and it is being propped up by cheap loans. So, as long as the monthly repayment is within the buyer's budget, he will get that new car."

(Source: The Business Times, 8 Nov 12.)

My reaction to this bit of news? This is totally mind-boggling!

Boggled at #1:
$77,201 for a certificate to own a car and a small one too.

Boggled at #2:
If monthly repayment is within budget, buy the car!

There are many rich people in Singapore. Bloomberg reported that there are 17 millionaire households out of every 100 households in Singapore in June 2012! Exact figure: 188,000 households.

I guess if buyers are able to afford a car at such astronomical prices using their own savings and if they really need the car, it is ok. If they don't need a car, why buy one?

However, if buyers are only able to afford a car because of the cheap loans available (which suggests that they have insufficient savings), it is not ok. This is especially so if they don't need a car.

Just off the top of my head, buying a $120k 1.5 litre Japanese car today and, to lose as little money per year to depreciation as possible, driving it for 10 years could see the buyer taking back only $7k at the end of the period. That is a loss of $11.3k per year or $942 per month!

In the above scenario, if the buyer draws a monthly salary of $4k, almost 25% of his monthly earned income is gone with the wind! If he really needs a car, it would be more prudent to look for a pre-owned car with a monthly depreciation of $400 or so. This would be a less destructive 10% of his monthly earned income.

People usually look at the running cost of car ownership: petrol, parking, road tax, insurance, ERP, maintenance and repairs. They sometimes forget depreciation which is a bigger than ever consideration in today's environment given the high price of the COE.

Any person thinking of buying a car in Singapore now, please think and think again.

Related posts:
1. Quick, buy a new car cheaper now!
2. A new car for $75,000?
3. Bought a new car!
4. The price of my car now.

President Obama wins! What next?

President Obama has been re-elected! Seems that Mr. Ben Benanke's job is safe. More quantitative easing, a weaker US$ and stronger inflationary pressure? Seems like it.

People are concerned about the "fiscal cliff". Could it turn out to be a non-event? Could the Democrats and Republicans reach a compromise?

What is the "fiscal cliff" all about and why should we be concerned?

If the current laws slated for 2013 go into effect, the impact on the economy could be dramatic. While the combination of higher taxes and spending cuts would reduce the deficit by an estimated $560 billion... the policies set to go into effect would cut gross domestic product (GDP) by four percentage points in 2013, sending the economy into a recession.

See full write up at: The fiscal cliff explained.

President Barack Obama won re-election in a tight campaign, besting Republican presidential nominee Mitt Romney in enough swing states to secure four more years in office.

The specter of gridlock would undoubtedly loom before Obama as he confronts an immediate task in addressing the series of automatic tax hikes and spending cuts – the so-called “fiscal cliff” – set to spring into place at the end of this year. As Obama won a second term, House Speaker John Boehner, R-Ohio, said Republicans’ retention of their House majority meant “the American people have also made clear that there is NO mandate for raising tax rates.”

Read full story at: NBC News!

The story does not end with President Obama's re-election, for sure. Another chapter is about to begin.

Want to be wealthier without higher risk?

More than a year ago, I wrote about a conversation I had with someone who was worried about the effects of inflation on his personal wealth. By chance, I met him over the weekend and we spoke briefly. He lamented that he did not listen to me as he could not come to terms with the idea that to protect his wealth, he had to take risk.

This reminds me of a saying in Hokkien I heard recently:
Afraid that grasping too loosely might let the bird fly away and that grasping too tightly might kill the bird.

So, fearing the wealth destructive effects of higher inflation, he wants higher returns from investments that have higher risk but the problem is that he cannot accept the higher risk!

If not for the fact that he looked so serious and troubled, I would have made a joke out of it.

This person is very careful with his money. Perhaps, too careful. Well, he has a family to care for and with young kids, I suppose he is right to fear risk. If there should be an investment that would offer him high returns with near zero risk, I am sure he would have jumped on it, but is there such a thing?

Anyway, I did not know what to say to make him feel better and after making some small talk, I bid him farewell. Would you know what to say to make someone feel better in such a situation?

Some people are just ill disposed to risk taking. Live and let live, I guess.

The paradox is that he is actually already taking risk by leaving his money in his bank account in the current low interest rate, high inflation environment and he is definitely not growing any wealthier.

Related post:
To protect our wealth, we have to take risk.

Music and movie!

 

 

I am Your Superstar -

Win a 2NE1 Limited Edition Autographed CD

with Nikon CoolPix S01!

Find out how at: NikonClub!

 

It is movie time!

 

Do you have a pet? Everyone who has a pet would know how heartbreaking it is when your pet leaves you.

For Victor Frankenstein he doesn't want to lose his beloved pet dog Sparky. He brings Sparky back to life only to face unintended and monstrous consequences.

Catch Tim Burton's Frankenweenie for a thrilling ride of comedy, adventure and horror!

 

See the previews at: Frankenweenie!

 

Sound Global: Smart money is buying.

On 17 Oct, I mentioned a downside target of 48c for Sound Global's share price. This might or might not materialise. Personally, I am not averse to buying a few bids higher if the technicals tell me that it could be a good idea.

As Sound Global's share price declined, volume has also declined. This picture of a low volume pull back suggests that the selling is weak. Indeed, looking at the MACD, we see a higher low possibly forming. Looking at Chaikin Money Flow, we see how money flow has turned positive even as its share price weakened lately.

Immediate resistance is at 51c while immediate support is at 49.5c.

This is another stock I am accumulating on weakness.

Water treatment investments are set to double in the 12th Five Year Plan Period (2011-2015) to CNY430b in an effort to improve China’s wastewater treatment rate to 85% by 2015, from 77% currently. Commercialisation and privatisation of the Chinese water treatment market is also a long-term trend. With over 20 years of experience, Sound Global has become one of the leading one-stop integrated wastewater treatment solution providers in China, with a respectable market share.

 

In our view, Sound Global’s revenue will be supported by: 1) continuous order wins thanks to a long-term relationship with the government, and 2) more BOT projects entering their collection period. A hike in water tariffs in China will also have positive effect on revenue.

 

Although we are positive on Sound Global’s revenue outlook, its high net margin of the past few years would be very hard to maintain, in our view. Recent high-cost borrowing will weigh on the company’s net margin for the next few years, assuming it does not redeem the senior notes before maturity.

 

Sound Global is trading at a large discount to its peers (6.7x FY12PE based on consensus vs average of 12.8x for HK-listed peers and Hyflux’s 16.7x). We currently do not have a rating and target price on Sound Global. However, we think the deep discount may not be justified given Sound Global’s comparable net margin and higher-than-peers ROE. Sound Global is worth considering if investors are looking for cheaper alternatives.
 

(Maybank Kim Eng, 8 Oct 12)

Related post:
Sound Global: Accumulate on weakness.

CapitaMalls Asia: Any correction is a buying opportunity.

CapitaMalls Asia's share price is enjoying a strong follow through after breaking resistance. Further increase in share price is likely to meet stronger resistance at $1.93, the 138.2% Fibo line. Overcoming this resistance level would see the next two golden ratios at $2.00 and $2.07 providing resistance.

It remains to be seen if $1.84 is resistance turned support. Stronger support is at $1.705 as that was a many times tested resistance that finally gave way after a period of seven months. Bears would have to be out in full force and more in order to push the share price below $1.705 as the bulls who missed the boat earlier would likely try to get on the boat at this very price, give or take a couple of bids.

All the daily MAs are rising and the picture has turned nicely bullish. Any correction to test supports would be a buying opportunity.

We reckon there may be opportunities for CMA to monetize some assets in 2013, such as Queensbay Mall and its 50% stake in ION Orchard. With continued strong underlying performance from the malls, we maintain our BUY recommendation. Target price is raised to SGD2.25. (Maybank Kim Eng, 29 Oct 12)

Related post:
CapitaMalls Asia: Broke resistance.

China Minzhong: Accumulate on weakness.

There are a few stocks which I would like to accumulate on weakness in the near term. China Minzhong is one such stock.

Many like Jim Rogers have put forth a convincing case of an impending food crisis. In the event of global food shortages, it is logical to expect food prices to rise. So, investing in food producers seems to make good sense.

Improving numbers, insider buying, an experienced management and the right industry, I believe China Minzhong is a good company to invest in. Also, there could be more positive catalysts and these could push its share price higher.

After hitting a low of 53c in early June, its share price rose to hit a high of 87.5c on 19 Oct. That is a meteoric 65% increase in a short span of 4 months.

The daily chart is showing some fatigue. Some consolidation is to be expected. The immediate support is at 78c. If that should go, next supports are at 74c and 70c. The MACD which is a pure price oscillator suggests that supports could continue to be tested. However, the Chaikin Money Flow does not show any significant outflow of funds which suggests that long holders are not in any hurry to sell. We could see share price doing what Daryl Guppy calls a correction using time which means people waiting on the side hoping to get back in when there is a price correction could be disappointed.

The weekly chart shows quite clearly that the downtrend has reversed. Breaking immediate support could see share price declining to test the 20w MA in the longer term. This currently approximates 71c. As the 20w MA is rising, the longer term support would be a higher value over time. The declining 100w MA, currently at $1.10, could cap any further price increase in the near future.

Buying when there is a test of supports with longer term MAs rising seems like a good idea. However, remember, TA shows where the supports and resistance are but it does not mean that they will be tested.

Related post:
China Minzhong: Opportunity in slowing momentum.

“If food inflation in China remains high, there is a high chance that the management’s revenue target (of 15% growth) could be surpassed.” Maybank-KE keeps a Buy call with $1.16 target. Read full article in The EDGE.

AirBook at US$464.96 only!

Looking for an inexpensive and sleek notebook? This looks cool and the price is amazing!

CPU: Intel Atom D525 Dual Core, 1.8GHz.)
Chips: Intel NA NM10.
OS: Windows XP.
Hard disk: 64GB SSD.
System memory: DDR3 4.0GB.
Aluminum Shell Slim Notebook Computer.
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Touchpad: With touchpad.
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LAN: 100Mbps Ethernet Access.
Storage device: Reader modules (SD/MS/MMC),MAX. 32GB.
Camera: 1.3 mega pixels camera.
I/O Port: 3.5mm audio jack, 2 USB 2.0 ports, Card Reader (SD/MS/MMC), DC IN, Mini HDMI. Adapter power supply: 100-240V Input; 19V/2.2A DC Output.
Battery: 7.4V/4200mAh.
Dimension: 334.5 x 223.5 x 21.8mm.
Weight: 1.45kg.
Language: English   

US$ 464.96! Free shipping!

Check it out:
13.3 inch Aluminum Shell Slim AirBook Notebook Computer with WIFI

Related post:
Save money with low prices and free shipping globally!

Black, white or grey?

I enjoy reading but the kind of stuff I read is mostly related to money and investments these days. Gone are the days when I would read a book of fiction every week.

A friend told me I have no life because I don't read the "Life" section of The Straits Times. Droll.

Anyway, just now, I read a story in Yahoo which evoked within me a mixed feeling of condemnation and sadness for the guilty party. Many times, things are not black or white although I would prefer for them to be so as it would make life easier.

This story has nothing to do with money and investments:

A 32-year-old female Singaporean teacher was sentenced to a year in jail on Monday for having sex with a 15-year-old boy in her school, local media reported.

The teacher, who was married with two children, started a relationship with the student last year after she started counselling him, the Straits Times daily reported on its website.

The teacher-student-monument in Rostock, Germany.

I think it is more common to read about male teachers in such cases or am I being sexist here?

After reading the story, my initial reaction was that the female teacher deserves the punishment. Pure and simple. Then, although I still think she should be punished, I feel a bit sad for her.

Under Singapore law, an adult found guilty of engaging sexual intercourse with anyone under the age of 16 -- even if it's consensual -- faces up to 10 years' imprisonment, a fine or both.

The boy is one year away from being legal. Could they not have been really in love?

Of course, there are other issues involved here such as how the teacher abused a position of power and trust. So, if the boy had been a JC student, the teacher could still have been dismissed by MOE but she would have been spared a jail sentence?

Once people are married, they are no longer fully their own person. They are only half a person. Whatever they do, they should think of the other half. If they have children, the responsibility becomes heavier as the children could be psychologically scarred for life through parents' thoughtless behaviour. So, I feel sad for her family too.

Then, I thought perhaps the boy's family could have thought about the teacher's situation and how they could have dealt with the issue differently. People do wrong sometimes. Perhaps, a private meeting with the teacher and a warning that she should stay away from their son would suffice?

Psychiatrists found "no predatory paedophilic tendencies" in the teacher. So, she is not a threat to the young in society at large. Of course, this fact only came to light because the case went to Court.

In a different time and age, could this have had a different outcome?

Read full story: here.

A blast from the past: Singapore blue chips or S-REITs?

I have been blogging for close to three years and looking back, I was a rather prolific blogger. Over the weekend, I read some of my older blog posts and found one which I have almost totally forgotten about.

Those were the days when S-REITs were largely unloved and shunned. Written in the first year of my blog's creation, to anyone who would listen, it was an effort to show that S-REITs could be great investments too.

Readers from my blog's early days might or might not remember this blog post but, I believe, all readers could benefit from the blog post as a reminder for us not to be bigots. It is a reminder to myself as well as I find that I have an increasing propensity to become mired in mental mud as I grow older. Feel the same way?

Then, you might want to read an ASSI forgotten classic:
Building and preserving our wealth: Singapore blue chips or S-REITs?

Three point turn!

This weekend, I am going to leave you with a very short blog post. Nothing original but sometimes, we need a few reminders, don't we?

Man is created in the image and likeness of God but there is nothing Godly about Man.

So, here are the three points which could turn our lives (for the better):

1.  We only need so much money in life. The rest is for showing off.

2.  Keep our needs simple and our wants few. We will have less money problems that way.

3.  Know what and who matter to us. Don't waste time and money on others.

True or not?





I hope we are all truly happier individuals over time. Have a good weekend, everybody.

"Every man is rich or poor according to the proportion between his desires and his enjoyments." (Samuel Johnson)

AIMS AMP Capital Industrial REIT: 2Q 2013.

A DPU of 2.5c has been announced. The REIT goes XD on 2 Nov 2012 and the income distribution is payable on 20 Dec 2012.

Gearing is comfortable at 31.5%. This leaves ample debt headroom for further yield accretive initiatives.

The REIT now has a new source of funding via a $500m Medium Term Note Program. It issued a $100m 4 years 4.9% fixed rate notes due in August 2016. Being an unsecured facility, the cost of debt is dearer but if we should continue to see positive rental reversions, this is still acceptable.

Indeed, the REIT manager has not disappointed as they have been successful in renewing leases with higher weighted average rental with positive rental reversion of some 17.3%. They have also reduced concentration risk as the proportion of leases expiring by 2013 have reduced from 35.7% one year ago to 9.9%. Of course, it remains to be seen if they could secure positive rental reversions by renewing the 9.9% now remaining. Negotiations are in progress.

The management should also continue to work towards 100% occupancy although, at 99.2%, it is already above average for industrial properties in Singapore.

Average security deposit of 7.2 months per property provides a peace of mind.

In the papers, it is reported that distributable income reduced some 5.4% but on a quarter to quarter basis, the reduction is much lesser at 0.6%. So, I wouldn't be too worried.

Although gross property income improved some 3% quarter on quarter, NPI reduced 1.4% due to an increase of 13.9% in property operating expenses. This includes repair and maintenance of some properties which should be a one off expense. Having said this, the management should continue to be prudent in managing expenses.

See presentation slides: here.
See financial statement: here.

Related post:
AIMS AMP Capital Industrial REIT: 1Q FY2013.

First REIT: 3Q 2012.

As the contribution from the divestment of its Adam Road property has run out, First REIT's DPU sees a reduction of 12.5%, quarter on quarter, from 1.92 to 1.68c.

Year on year, however, DPU has improved from 1.58c to 1.68c.

I would say that First REIT has produced sterling results yet again.

Income distribution is payable on 29 November 2012.

See financial statement: here.

Related post:
First REIT: 2Q 2012.