Passive income, CPF savings and a topless pic.

I have a friend of more than 20 years who used to be fabulously fit. 

Now, he is "flabulously" fat. 

He is even fatter than I was last year before I embarked on my effort to lose weight.

A few months ago, he said I looked unhealthy because I lost too much weight in a short time. 

Basically, I lost plenty of fat without gaining enough muscle mass. 

My entire frame shrank. 

Imagine that. Horrible, isn't it?








I was climbing stairs, lots of stairs, but I wasn't doing enough upper body workout. 

The solution for me, I found, was simple. 

Do more push ups. 

This is a simple and effective exercise that I can do at home. It builds stronger arms, shoulders and chest. It helps to strengthen the core too.






Anyway, when I saw my friend again recently, he said he has decided to lose weight too. 

It won't be an exercise to look fabulously fit but an exercise not to look "flabulously" fat. 

All he wants is to be able to wear swimming trunks to the pool again instead of a pair of board shorts.

He said,

"You can definitely go to the pool in swimming trunks now."






I don't enjoy swimming very much and walking around outside in a pair of trunks is like being clad only in my undies for all to see, I have always thought.

He said,

"But you can do it with confidence now."

Yes, I know what he meant but I would still feel uncomfortable being mostly naked in public.

My family and friends know that my determination to lose weight has everything to do with health and very little to do with looking good. 





I was probably somewhat extreme earlier on in my attempt to lose weight. 

I was really driven by fear.

This is similar to my determination to be frugal when I started life as a working adult. 

On hindsight, I was probably too extreme for many years of my life in allowing myself only $300 in spending money each month. 

Again, I was really driven by fear.





When we fear something, we are likely to take measures to avoid it.

The fear that my health might worsen drove me to lose weight. 

The fear of growing old and destitute drove me to be frugal.

Unless you are new to my blog, you would know that my frugal lifestyle is an important ingredient in the recipe for achieving financial freedom.





Now, I am pleased to share that my health has improved mainly due to my weight loss which has been achieved mostly through dieting and, to a lesser extent, a moderate exercise regime.

In the conversation with my friend, I joked,

"I will only feel comfortable being mostly naked in public if I could hide my face."

We had a good laugh and, then, he said,

"Why not share in your blog? You are faceless there. You might inspire people like me to lose weight too."






OK, I am comfortable sharing how much is my passive income and how much I have in my CPF accounts only because I am an anonymous blogger. 

The purpose is to inspire by sharing my own experience. 

To be honest, I was afraid I might regret it but so far, so good.

So, I guess this is another first for AK and I hope I don't regret doing this. 





With some trepidation, I share here a topless pic of myself taken today:

Ooops. Wrong photo. It should be this one:

If you are overweight and think that losing weight is too difficult, I hope you will think again.

I believe that any overweight person mentally strong enough to go on a journey towards financial freedom is mentally strong enough to go on a journey to lose weight. 

I am putting an emphasis on mental strength because it is about discipline.

Losing weight is not an easy journey. 

Like our effort to achieve financial freedom, we have to make positive changes and stay the course.

However, compared to trying to achieve financial freedom, losing weight is much easier. Believe it.





Related posts:
1. My food bill grew in size!
2. Being fallible in dieting.
3. Essential habit to becoming richer.

AIMS Property Securities Fund (formerly MPSF).

A conversation with a reader led to a discussion about an old dusty investment which I would not have made knowing what I know today:

Reader:
if you like aims cap reit management so much, then do you like aims property fund?

both are listed in sg

 

Assi AK

Different animal

I have a legacy position

It was MPSF
it is a fund of funds
just that alone made it a mistake

Reader:

coz aims cap reit is steadily dropping but aims property fund is steadily increasing

 

Assi AK

the rights issues (two, iirc) were very cheap and i bot more

a few cents per unit, iirc

those were cheaply bot

quite happy

but it still doesn't change the fact that it is a fund of funds which i would not touch these days

Reader:

i guess you would rather diversify them yourselves than to pay extra management fees

Assi AK

lack of transparency too... many funds they own are not listed

that makes it worse

i got into it based on recommendation by a friend who invested tons in it (including his mother's money)... lost most of it

In case you are wondering, AIMS Property Securities Fund (formerly MacarthurCook Property Securities Fund) is still in my investment portfolio.

I took up the rights units I was entitled to and I also applied for excess rights during the fund raising exercises after crunching some numbers and deciding that the fund would be able to pay decent enough dividends in due course.

Getting in years ago when I did at a much higher price without fully understanding what I was getting myself into was a mistake.

However, participating in the rights issues after doing much more research and deciding that it had become a bargain then has proven to be rewarding.

All investments are good investments at the right price.


For more information on the fund:
http://www.macarthurcook.com.au/mck/en/Investments_Funds/Investment.aspx?id=2

"Units on issue in the Fund will be consolidated on a 1 for 10 basis." - 4 July 2016.

Related post:
AIMS AMP Capital Industrial REIT

Trump won the election and I lost my life savings.

• Reader:
• "Recently, my friend just shared with me that he lost 80k on the day that trump won the election. He went to short jap futures seeing that the DJIA futures were tumbling. The media were calling for doomdays and he shorted aggressively. In the end, he got stopped out. Now he has lost his entire savings. I wonder how long he will need to save another 80k. Now no more ammo to invest if a crash finally happens. I also didnt expect the market to recover that fast and break new high thereafter. Any special advice for the friend of mine.. It seems that he doesnt learn from his mistakes..."

• 

  
  

  Assi AK
  

  Ask him to read this for a start:

Position sizing, war chest, volatility, nibbles and gobbles.

Don't ever throw everything we have including the kitchen sink into a gamble. 





We should be smart enough to know that it is a gamble and be realistic enough to know that things could go horribly wrong.

Don't ever think that we are invincible.

The moment we think we are invincible, we might just fall into a hole which might take us a long time to get out of.





Related posts:
1. Grew more daring and lost $100K!
2. How to make recovering from losses easier?

Why worried metrosexuals seek help from AK?

There are two parts to this blog post. The first part was written a few weeks ago before I decided to take a break from blogging. The second part was written a few days ago.

---

FIRST PART

---

Readers who have written to AK to ask for a private meeting would know that they are likely to have a reply in the negative. This is mainly because AK is a very private person. Well, it also has to do with the fact that he is very lazy and finds it a bother to meet people.

Recently, I received an email from a couple who were introduced to my blog by a mutual friend. Yes, it was signed off by both of them, two names. Later, they told me it was to be doubly sincere. Does it work that way?

Anyway, they read a few of my blog posts which our mutual friend suggested and found them mind boggling! They found them so mind boggling, in fact, that they picked up the courage to write and requested for a private meeting with me, explaining to me their current situation and how they were worried about their financial future. As usual, I wrote them a short reply, politely declining the request.

The next day, I received a call from my friend. He was roped in to help persuade me. He said that the couple were very private people just like me and they did not trust advisers in the banks or even insurance agents. They would prefer to talk to someone who has no vested interest like me.

When I told my friend that they could wait for the next "Evening with AK and friends", he said they were genuinely worried about their ability to achieve financial freedom and did not want to wait. 

They had a whole gamut of questions and would prefer to have me to themselves for a few hours and were, in fact, willing to pay me for my time.

---
SECOND PART
---

I met up with the couple a few days ago in their flat. Yes, it was a home visit as the couple felt more comfortable meeting at home. Quieter and more private. As the meeting would probably last a few hours, I agreed that it made sense to be in a comfortable environment too.

Their home was definitely comfortable. It fact, it could be an understatement.

It was a HDB flat but it felt like the hotel suite I stayed in Hong Kong once upon a time (and I blogged about it in my travel blog before: here). It was really very nicely renovated. It was obvious that they spared no expense.

When I remarked at the relative opulence of the interior deco, they told me they loved travelling and always stayed at 5 star hotels. Coming back from their travels, they didn't want the feeling of luxury to go away.

I could not resist asking how much the renovation cost. The most expensive HDB 3 room flat renovation I knew up till then was $60,000. They wouldn't tell me how much their renovation cost exactly but they told me it was a 6 figure sum!

I felt like the church mouse there and then. Now, something like that was mind boggling to me.

When our mutual friend told me the couple were "metrosexuals", it probably didn't register but when I saw the couple, I understood.

I first came across that word when the newspapers used it to describe an MP of ours, Mr. Teo Ser Luck, years ago. It sounded posh and it sounded expensive.

"A metrosexual is especially meticulous about his grooming and appearance, typically spending a significant amount of time and money on shopping as part of this." 
Source: Wikipedia.

They were both well groomed and well dressed. I was dressed in my Uniqlo best but I probably looked a bit shabby. Shabby chic, maybe?

I won't be sharing the details but, in the next few hours, I answered all their questions and made quite a few suggestions to help them achieve financial freedom. Big adjustments would have to be made.

As we chatted, to them, the topic wasn't mind boggling anymore, it was almost depressing.

They have probably enjoyed their lives to the fullest but now find it difficult to envision an enjoyable life in their golden years.

As they are in their 40s, I told them that they would have to work doubly hard now to achieve financial freedom not by 55 years of age (which is what they want) but possibly by age 65 (when CPF Life starts paying them a monthly income for life).

Obviously, they were not thrilled by the idea.

Realistically, however, without making any adjustments, they might never be able to retire (even with CPF Life's monthly payments) if they want to maintain their current lifestyles.

They still looked somewhat depressed when they shook my hand as I was leaving their home (and I am quite sure it wasn't because they had to give me a red packet as promised) but there was determination in their voices when they told me they would take all my suggestions to heart.

They said they wished they had done all that I did in the last 20 years. I could only smile and wish them the very best on their new metaphorical journey. All of us could do with a bit of luck, after all.

So, why did these metrosexuals seek help from AK? Definitely not because AK has good fashion sense.

Remember, we have choices in life. While we still have time on our side, choose wisely.

Related posts:
1. Work hard and plan early.
2. Too late to plan at age 57?
3. Retiring before 60 is possible.
4. Wife on retirement adequacy.
5. To be a happy peasant.

Breadtalk, Old Chang Kee and QAF Limited.

I avoided buying Breadtalk's stock for a long time, probably for as long as I avoided buying their bread and I definitely have never bought their "fresh" soya bean milk before. All so expensive.

Yes, I know. AK is very giamsiap. Terrible!





A very high PE ratio and gearing makes the stock unpalatable. 

To make it even less attractive, the dividend is peanuts. 

Give shareholders only enough money to buy some bread, maybe.

However, I revealed that I nibbled at Breadtalk on price weakness during the last "Evening with AK and friends". Why har?





Reader:
Sir, there is one thing that puzzled me. You mentioned that you bought Breadtalk, but this seems contrary to certain principles which you always talk about. 

For example, the stock doesn't seem cheap, seeing that the PE of 44 is near its 5-year high. 

Second, the stock doesn't give very high dividends (you already explained this point). 

It is the first point that puzzles me, since you have always talked about buying an asset when it is cheap. How come this time it is different leh?





Assi AK:
If cash flow from ops is strong and CAPEX reduces, earnings will improve.

BT has strong CF... CAPEX needs to come down and if/when it does, earnings will go up and PER will improve. 

They could pay better dividend then. 

Not for the pure income investor.

Tsk, tsk...

Not for the purist income investor, to be sure, it is a smallish long position for me.

Consistent with my philosophy (remember "the pyramid") and to put things in perspective, it accounts for less than 1% of my portfolio.

Related posts:
1. Old Chang Kee versus Breadtalk
(Why AK prefers OCK to Breadtalk?)
2. QAF Limited.
(If you like bread, QAF is yummier!)
3. Bought cheaper bread on BREXIT!
(AK bought more at $1.03 a share.)

A good wife worries about retirement adequacy.

A recent conversation with a reader:

Reader says...

I have been a silent reader mostly for several years now. 

And i am ashamed to say that i now feel like i have not learned well from your blog, and am caught in this situation where i just do not know if i should bite the loss of almost 15k, or just continue with the plan i bought from my FA. 

Hence, I am writing to hear your advice.




I am 34 years old and my other half is 36... purchased a Retire Happy plan last year. 

My husband purchased it mainly because of me.

I was doing a review of this plan and chanced upon your words of wisdom on this Retire Happy. 

And then i realised that i might as well have topped up my own CPF account.




What should i do now?

Even though its my hubby's money, it is foolish to continue with a plan that is not value for money.

If i terminate the plan now, I will lose about 15k, which is damn a lot of money. 

If i don't, there is no guarantee that my hubby will save. 






After i have explored the CPF option, we are shocked to know how good it is but my husband still says he won't be maxing out his CPF as he doesn't have enough cash.

The most sensible and logical thing would be for my hubby to max out his CPF with the monies he is using for my plan and use it to provide for our retirement, but honestly, money is truly emotive and i don't know if he can.

What should i do, AK? I feel like a foolish wife now.

Would be eternally grateful for a response.

AK says...

I am only talking to myself in my blog. 

If you overheard me talking to myself, you have to decide if I make sense. ;)

I think you know what you want to do.

Does it make sense to continue sending money to where it is not treated best?




I understand that things are not as straightforward in your case because you are trying to force your husband to save money. 

Frankly, however, what is to stop him from not making regular payment towards Retire Happy?

I feel that if he is committed enough to pay regularly now, you should trust him.




Instead of paying Retire Happy, ask him to pay you and you manage the money. 

You could take the money, do MS Top Up to his CPF-SA and not keep it for yourself to show that you are doing this for him and the family. :)

To be quite honest, we cannot be sure of anything in life. It is all about trust. 

There is no guarantee that things will always go our way. 





We just have to do what we feel will give us peace of mind.

It depends on what we believe in.

I believe in having a risk free and volatility free portion in my investment portfolio. 

I believe in having an annuity that pays me not for only 20 years but for life. 

I am lucky to be a CPF member and I am maxing out the benefits of my membership.






Related posts:
1. Retire Happy.
2. How many $29K do we have?
3. How to upsize $100K to $225K?

Selling a car or a flat yourself.

Things change and that is one of the few constants in life.

Some changes hardly matter but some changes affect our lives in a big way. 

Changes could also be catastrophic. 

Remember the Dodo.

What is this leading to?




A few months ago, I sold my car without going through a middle man. 

Cars of the same make, model and age at pre-owned car centers were going for upwards of $50K at that time. 

I was offered $40K to $45K by different resellers then.

I decided to find a new owner for my old car myself. 

It was a relatively short search as a friend was looking to replace his much older car then. 




We had a win-win situation with the middle man removed.

It did mean, however, that we had to visit LTA in Sin Ming, queue up for more than an hour to do the transfer of ownership but that was just a minor inconvenience.

If you are thinking of selling your car, you might want to do it yourself. 

It is quite easy:
http://www.oneshift.com/used-car-buying-guide/718/how-to-sell-your-car-directly-to-a-buyer



Now, if selling your car without having a middle man is a good idea, what about selling your flat without engaging a property agent?

Well, it seems that many people are also selling their flats without the help of a property agent:

"According to figures from HDB, the number of resale flat buyers and sellers who have gone the DIY way rose to 24 per cent in 2015, from 11 per cent in 2010. 

"So far this year, 23 per cent of resale transactions carried out from January to May were completed without a property agent."
Source: CNA





It is probably an understatement to say that real estate in Singapore is expensive. 

Real estate is very expensive. 

A commission of 1% or 2% (as in the case of a HDB flat) is a big deal. 

I remember selling my home a few years ago and having to pay a 5 figure sum to the property agent. 

That is a fair bit of money.

If we can save a bit of money, why not?

If we can save a lot of money, what are we waiting for?




So, how easy is it to do it yourself?

I went to the eCitizen website and found out how easy it actually is:
https://www.ecitizen.gov.sg/Topics/Pages/Selling-your-HDB-flat-A-step-by-step-guide.aspx

"We were surprised because we thought it would be quite complicated. 

"The officer at HDB (Housing and Development Board) was also very helpful to go through the paperwork with us." 
Source: CNA






For a seller who is willing to spend some time to do some work, considering the huge amount of money saved, it is worth it.

“Especially with the emergence of social media, people get connected much easily compared to 10 years ago. 

"That’s why many home owners are now able to find home seekers by themselves or vice versa...”
Source: CNA

Selling your car or flat?

I think it is worth exploring the option of doing it yourself.

Related posts:
1. Fixed rates, SIBOR, FHR18...?
2. Affordability and value for money.

The AK passive income strategy after making $1m.

It has been a fortnight since I announced that I was taking a break from blogging. Time flies.

Does this blog post signify the end of my break?

No lah. I am still on a break. AK is lazy.

This is just a short note to say AK is lazy but still alive. (Wink, wink.)






The first thing I want to do is to share a very thoughtful message from a reader. 

I could tell that it is from the heart and not just lip service:

Thank you for the empathy and well wishes. I truly appreciate it and will (try to) take good care of myself.

After all, why have passive income if we don't spend more time doing the things we want to do?






I should be working because I want to and not because I have to. 

Right or not?

Warren Buffett said this about the importance of having passive income before:

"If you don't find a way to make money while you sleep, you will work until you die."




There is no way in the world lazy AK wants to work till he dies.

Hmmm... OK. How does this sound? 

I have been enjoying myself watching K-drama, spending time pottering around in my planter, tending to my aquariums, eating right (most of the time) and exercising (but not as frequently as a few months ago). 

My shrimp tank.

Yes, economically not very productive. 

Terrible!

Bad AK! Bad AK!

What? Investments?

I haven't done anything, really.

For a while, I was loading up mostly on DBS but since my last blog post, I have kept the status quo in my world of investments.

Easy thing to do, doing nothing, you think? 

With the help of anti-itch cream on itchy fingers, maybe so.






For me, it might be easier to do nothing than most because I have an anti-itch cream called "ample dividends".

Not just "dividends" but "ample dividends". 

Well, I think it is ample to someone like me, anyway.

I have such a cream because most of my investment portfolio built over the years is made up of investments for income. 






Unlikely to give me a heart attack, these investments generate regular and meaningful income for me. 

Enough to cover my routine expenses and more, they allow me to go about my business of being lazy with less worry.

What? Being lazy is not a business? 

OK, you win.




So, does AK really have no plan at all when it comes to investments?

Well, I honestly feel that I don't have to do anything to grow my passive income further.

Of course, I cannot buy a Richard Mille watch or a Ferrari car at the drop of a hat (Why would I want to do that, anyway?) but I am financially quite comfortable now, I feel.

homer123 wrote:

I am not at all surprised that Sporean are highly interested in passive income.. One of the most popular blog with more than 12 million pageview by AK71 aka ASSI claimed he has collected more than 1 million dollar in passive income in less 10 years.. more than the average income typical Sporean can make from their salary! 


http://singaporeanstocksinvestor.blo...ollars-by.html

sAVaGEmP5:
I hope u are not here advertising or spamming blog post ? 
Such a lousy written article that taught me nothing new, u dare to post here. Let me see the Lambo, richard mille or the MBS penthouse then consider real pls.
Source: HWZ.

However, if I want to grow my passive income further, it should not be growth at any price which is a mistake many people make, including moi. 

It should be growth at the right price. 






Now, what is the right price? 

Uh oh, that sounds like quite a bit of work, doesn't it?

An easy way to get around having to do more work is to buy on a dip or a correction in prices. 

All else remaining equal, there will be greater safety buying on the back of a 10% or 15% decline in prices. 

Right or not?






I don't know. 

I anyhow talk to myself.

If prices don't decline, it is OK for me too. 

I will just accumulate more cash in the meantime. 

Remember what Charlie said? 

There are worse things to do than to sit on plenty of cash.




Finally, I plan to max out the CPF Annual Contribution Limit in the next 10 years (till I turn 55) by doing more Voluntary Contribution as I no longer have significant Mandatory Contribution.

This will ensure that the risk free and volatility free investment grade bond component in my portfolio stays at a meaningful percentage.

With a focus on passive income generation, mine is a strategy that gives me peace of mind and it makes me happy.





Related posts:
1. Made $1m investing for income.
2. Revisiting a simple strategy.
3. Instant gratification of yield.
4. AAA rated sovereign bond.
5. Having peace of mind.

Investing for income is a journey I do not regret.

Conversation #1

AK:
If you enjoy writing, you will enjoy blogging. It is really that simple. :)

People who start blogging because they think they can make money will (mostly) give up after a while... ;p


Reader:
Money will be the least consideration.




AK:
But it is time consuming... So, you have to think about that especially when you have many comments and also emails to reply to over time...

A good way for me to kill time ;p


Reader:
lol
in a way, u enjoy it?

AK:
Not as much as I used to... quite honestly




Reader:
becoming more of a chore?

AK:
i used to blog about anything i want
i happy i blog
these days, i self censor
also many readers... comments and emails...
i try to reply all...







Reader:
these days, even govt agency reads yr blog lol

AK:
when some commercial outfits write to me... offer to increase my readership, I told them "no, thank you"
i not doing this as a biz
i dun need
ya.... govt read also... say wrong stuff, go to chia thye poh old place... cham... scary
OK... i go take a nap liao

CONVERSATION #2

About: Scolded by wife...

I am thinking about taking a break from blogging and all its related activities.

So, don't be too concerned if you do not hear from me as regularly as before for the next few weeks (or months).




In the meantime, remember that as long as you are doing the right things, you are probably moving in the right direction.


If you believe in investing for income for a better future, it is important to believe in yourself first. 

Believe that you can do it and you will.





Believe that this is a journey worth going on, stay the course and you will surely be rewarded. 

Gambatte!


Related posts:
1. Make $1m by investing for income.
2. AK trying to be most popular blogger?