Moneytology: Simple, common-sense & reproducible

2014-10-30T13:11:00.000+08:00

Just added 2 more work sheets + made the EPF portion better for (1):

Google Sheets contains:
1. Crystal ball gazing into your financial future based on your yearly savings, EPF savings, etc VS retirement age, retirement lifestyle cost, other 7 specific goals' costs, etc

2. Asset allocation planning

3. Investments & trades tracking

https://docs.google.com/spreadsheets/d/13lkpnpvDajVJ__b62aZSMcHP4MD8bxMTZbOYH6_32bQ/edit?usp=sharing

Financial Freedom SHARED - Google Sheets

DOCS.GOOGLE.COM

2014-10-29T13:24:00.001+08:00

Just created this on Google Sheets for my team member to "see" and play-with, for visualizing & planning her future cash flow.

https://docs.google.com/spreadsheets/d/13lkpnpvDajVJ__b62aZSMcHP4MD8bxMTZbOYH6_32bQ/edit?usp=sharing

Thus - thought it'd be useful to others too.
Please note:
1. Please make a copy to your own Google sheets in order to edit at your own private pleasure.
U won't be able to edit the version i shared.
To make a copy: File >> Make a copy

2. EPF variables - specifically tailored to Malaysia
If U do not have any such items (it's like 401K, CPF, etc), just zero-rise the variables.

3. Goals 2 to 7:
If U do not have them, zero-rise them.

4. Does NOT calculate taxes on investment or trading returns.
Please factor taxes in to get the net returns pa % expected.

5. Focus on Column D, Row 14 onwards - this is the cash-related investments that will be funding your retirement and goals.
If the row's cell is NOT red, U should be ok.
Red = no more investments to fund anything from that year/row onwards

6. Anything else?
drop me a line here and i'll see if i can incorporate the idea OR clarify usage of existing.

https://docs.google.com/spreadsheets/d/13lkpnpvDajVJ__b62aZSMcHP4MD8bxMTZbOYH6_32bQ/edit?usp=sharing

2014-10-24T13:59:00.002+08:00

Ah... nearly 2 years have zipped by... and things have been chugging along still.
No severe fear (just greed in markets) until recently in Sep/Oct 2014.

These 24+/- months:

Median net worth growth was about 15%-26% based on a 12 months' moving median.
Average net worth growth was about 11%-18% based on a 12 months' moving average.

Looks like growth from frugal living (savings) being an impact on net worth growth is diminishing as net worth gets higher.
ie Salary has stagnated but cost of living, even frugally, has increased.
Sigh.. what to do, slave to my bosses.

Bottom line:
I'll have to explore other avenues of net worth growth, active or passive,
as salary stagnation Vs cost of living is hit
+ value equity buys are harder to come by with markets going up & up and away (until recent Sep/Oct 2014 hiccup).

Please note - this post is not to brag but to share
a. If we track it, we can manage it better (look at corporations & business world)
b. As we track it, we will "see the light at the end of the tunnel", and it's not an oncoming train
c. Simplify, save and invest consistently and holistically.

Just a thought.

2014-10-24T13:30:00.000+08:00

Whoa.. haven't updated since.. 2012!

Been looking for deep value buys but hard to find things to dive deep into, thus since end 2013 been exploring trading US stock options with a small % of my portfolio.

Dang interesting them stock options, even to an investor (ie. not as a trading tool).
An example and contrast vs "traditional stock investing"
1. Traditional stock investing on Nestle
a. Place order to buy at 60 for 200 units, then wait for order to be filled.
b. IF order not filled for the day, repeat until filled.
c. Bottom line: Can be long time before being filled... "wait till neck also long", while not making $
VS
2. Selling Naked Puts option on Nestle strike price $60
a. Place order to sell naked PUT Nov 2 contracts (200 units), for $0.10
b. Order filled as the "cost of insurance" is comparatively low & i get $0.10 *2 contract *100 units per contract -commissions/fees in pocket
Note: Put buyers may buy Naked Puts as an insurance hedge against falls in their stock's price
ie. Put seller is contractually obligated to buy the stocks at contracted strike price if forced by Put buyer
c. IF Nestle doesn't fall to $60 by contract date (Nov), i keep the premium paid by buyer
Repeat 2a. for next month until Nestle falls to $60
d. IF Nestle falls to $60 by contract date, i get "assigned" and must buy Nestle at $60.. dang! :P
e. Bottom line: While waiting / fishing for my value price, i get premiums + when i get hit with an assignment, dang.. i'm so sad.. bwhahaah.

Just a thought :)

Tracking of growth / net worth - 2011 to 2012

2012-07-12T16:57:00.001+08:00

Ah... another year gone & things have been chugging along.
Fear & greed was my constant companion, especially in 2011 Aug (fear) & 2011 Dec (greed).

These 12+/- months:

Median net worth growth was about 17%-18% based on a 12 months' moving median.
Average net worth growth was about 24%-26% based on a 12 months' moving average.

Returns from investments were not as great as the ride from 2009 > 2010 > 2011, thus, the growth was mostly thanks to frugal and simple living.

Please note - this post is not to brag but to share
a. If we track it, we can manage it better (look at corporations & business world)
b. As we track it, we will "see the light at the end of the tunnel", and it's not an oncoming train
c. Simplify, save and invest consistently and holistically.

Just a thought.

Basics covered - Q & A makes it lively

2011-08-09T20:54:00.002+08:00

G' day ladies & gentlemen.

Since $ management and investing basics are so.. basic and common sense (IMHO), thus not much for me to add here unless there are questions posted.

Thus, i'm doing most of my "postings" in forums. They can be found at:
1. Low Yat Net forum:
http://forum.lowyat.net/index.php?act=Search&nav=au&CODE=show&searchid=949495e1aff27eb3a639a21362dc7d8a&search_in=posts&result_type=posts

2. PropertiesWTF: http://www.propertywtf.com.my/wongmunkeong-u827/posts/

Please do post your Qs in these forums and let's share to sharpen each other's minds & Financial IQ.

3. You may also be interested in a pack of Excel tools i've uploaded here
http://forum.lowyat.net/topic/1577849/+698 OR http://www.propertywtf.com.my/post4831.html#p4831
The tools/worksheets ranges from:
Net Worth tracking,
EPF extrapolation based on salary growth %, bonus, etc,
Properties Evaluation (just quantitative) & rental/sale returns tracking
Investment returns calculation (for those stuff like put in $10K for 6yrs, and get $xxx,xxx in 30 years)
Effective rate of interest pa compounded for straight line loans like car loans and personal loans
etc.
phew.

Tracking of growth / net worth

2011-08-06T09:32:00.002+08:00

It's another year or two, and by tracking the details and % of my net worth, I know that the methods put into use / habits are still working and working great. My yearly (moving 12 months) growth's average is still 28% to 30%+ and the median is 24% to 27% . Woo hoo!

Eh, not all of it is due to investments' returns yar, it's also due to my crazy savings (to me it is crazy mar 40%+ excluding bonus, 70%+ including bonus), enabled by simplifying my life.

Side note, just as a statistic, if you save 43% of your investments returns' and spend only 57%, your $ will never be finished - assuming 8%pa returns and 6% inflation.

Please note - this post is not to brag but to share
a. If U track it, U can manage it better (look at corporations & business world)
b. As U track it, U will "see the light at the end of the tunnel", and it's not an oncoming train :P
c. Simplify, save and invest

Updates on my 1st Investment Property

2011-08-06T09:23:00.001+08:00

Hm.. prices shot up like nuts already. I've gotten several offers to buy it off my hand and have finally accepted one - hey, if the market is so eager and chasing things higher, who am I to stand in the way yar? :P

Anyways, IMHO, back to basics.
When the market is crazy, high on fumes and is willing to pay dearly for stuff, i sell.
When the market is crazy, manic depressive and is willing to discount heavily to get rid of stuff, i buy.

Works well in the long run without crystal balls.

2011 08 05 Fri - another Black Fri

2011-08-06T09:19:00.002+08:00

2011 08 05 Fri - Anyone here ran with their hair on fire, looking at the plunge in Dow and the rest of the financial markets?
Heheh - in Malaysia here, i happily gobbled up 2 REITs at bargain prices, thus good gross Dividend Yield expected of 8%+/-, BSDREIT and ARREIT. Too bad others on my target did not drop to my trigger price :P

LPI - rights issue, some thoughts

2010-07-26T17:34:00.003+08:00

LPI or LonPac, has been a good run for me when I bought it at RM9.80 in 2009, missed it at RM8+ :(
Net return, inclusive of net dividends, is about 94%+/-.

I was alarmed when I read that LPI was proposing to do a rights issue of 1 for 10 (held before bonus issue) at RM7. Rights issue is a touchy subject for me, especially when there's no good rhyme or reason tied to it. Thus, I did some simple logic-based calculations to aid my decision to SELL before rights issue or HOLD and buy the rights issue. All criticisms of the calculations are welcomed - I aim to learn :D.

Stocks issued (current) = 138,723,000 shares

Net Assets Per Share (current) = $6.54

Thus, Net Assets = NAPS * Stock Issued = $907,567,482.90

Bonus shares: 1 for 2 = 69,361,500 shares

Rights 1 for 10 before bonus, $7 per rights = 13,872,300 shares

TOTAL Stocks Issued after Bonus and Rights = 221,956,800

NEW NAPS = Net Assets / Total Stocks Issued after Bonus and Rights $4.09

Rights issue $7.00

% premium over NAPS = (Rights $7 / New NAPS $4.09) -1 = 71.19%

Current % premium = (Stock Price $17.86 / NAPS $6.54) -1 = 173.09%

Depressed stock price of $9 in early 2009, premium = 37.61%

Whoops - my earlier post had typos from my itchy fingers, added too many zeros to the stocks issued (current). My bad.

Based on the amended data above, the RM7 for the rights issue is worthwhile, given that it is a premium of 71.19% over the Net Assets Per Share based on the current issuance + the new issuance. Most other "good stocks" are way above the 70% premium of Price / NAPS, eg. PBBank, Nestle, GAB, DLady, Amway.

Any logical error with the above thinking - assuming the NAPS are not calculated too "creatively"?

InvestorExpo at KLCC Convention Centre 17-18 July 2010 10am-8pm

2010-07-17T18:08:00.001+08:00

By the numbers...

1. Reached by 9:50am (yeah yeah my watch is permanently 10 minutes fast)

2. Queued and filled-up form

3. 15 minutes later.. registered and got the "goodie bag"

4. Over zealous guard stopped me from going in, stating I've not registered, even though I kept telling him I did and showed him the "goodie bag". Blood boiling... told him to go check his own SOP and after he did, he relented.

5. Egads.. 20 minutes exploration and asking around.. that's it.

Nothing incredibly interesting

a. Mostly vendors giving talks about their own products in "seminars" (ahem ahem - edutainment or marketing),

b. Alternative investments like wine collection (er.. i think alcohol + investment is a no-no for me, just like alcohol + driving heheh) & land banking

c. Some hot looking women though - I guess what works for car sales will work for "investments" too. I think it's a proven psychological thing - aroused males tends to take more risks, google it ;P.

By the way, anyone wants RM500 vouchers (I've got 2) for OSIM purchases of RM2,500 and above?

Tracking & Benchmarking Oneself

2010-07-14T19:19:00.001+08:00

Hm.. I noticed it's been 6 months since the little interview article by Personal Money. During then, my 12 months' moving net worth growth rate was about 28%. For the past six months, it's been averaging 32% - heheh, now you know my total net assets ain't that much because it can be so high. I'm quite surprised as the financial market's been plunging and popping wildly. By the way, I don't count my 18 years old car, household items, computers and stuff that depreciates as Assets.

In my opinion, if I don't track, I won't be able to see, compare & know - making it nearly impossible to improve.

What about you - have started tracking your net worth and finding something interesting? Care to share?

Value Averaging - Personal Money July 2010 Edition

2010-07-10T16:01:00.000+08:00

Finally - a local write-up on Value Averaging. Hm.. those folks interviewed kept mentioning about "may need to have deep pockets" to implement Value Averaging properly. Gentlemen, you can marry Dollar Cost Averaging & Value Averaging concepts mar - thus, it becomes programmatic in terms of execution, $ allocation and yet doing value averaging.

If you are interested in Value Averaging, checkout 2 books:
1. Value Averaging: The Safe and Easy Strategy for Higher Investment Returns
By Michael E. Edleson, William J. Bernstein
A hardcore value averaging, DCA and tweaked DCA comparisons.

2. How to Make $1,000,000 in the Stock Market Automatically
By Robert Lichello
The title is a bit "lala land" but the concepts and formulas inside are golden. Look at TwinVest - a marriage of DCA & Value Averaging.

Personally, my best programmatic investment results were from TwinVest methodology - simple to use, simple to stick to and results, good. Mind you, TwinVest is just a Buy rule, you'll need to marry it to Sell rules too to be effective.

Properties: Hands-on learning Part 4 - S&P done & Legal for ING Loan ongoing

2010-07-10T15:50:00.000+08:00

Finally, the S&P has been concluded. Gawd.. 6 months! This is the longest I've ever experienced and it's a freehold property. The good side-effect is that property prices have generally jumped about 20% without me coughing up any mortgages for 6 months heheh. I have to thank the vendor's legal beagles for this unplanned "profit".

Oh, I took ING's Fixed % offer of 4.85%. Due to the rising OPR (Overnight Policy Rate), I think i've taken a more "controllable" financing method than BLR -x.x%. I'll know for sure after several donkey years down the road ;P

Properties: Hands-on learning Part 3 - Financing

2009-12-18T08:00:00.000+08:00

Just got back from Ho Chi Minh City (thank you bosses). The historical tours were mostly quite depressing and eerie - deaths, killings, tortures - the "fun" of war, where no one wins except the politicians. Mekong river, Dong Koi street (wandering around with colleagues & alone) and food was great though.

Ah.... the rush (to ensure Seller wins by avoiding RPGT in 2010) in finalizing the S&P + Novation Agreement for the transfer of the existing rental contract is going on smoothly - thanks to the capable Ms. Chung Fui Yee of Ky, Lim & Churme.

While that's happening, I've already nailed down the financing options to:
HSBC's (BLR -2.x%) Islamic Flexi home loan
VS.
ING's fixed rate 4.85%

Why these 2?
1. HSBC is not playing the bloody game that most banks in Malaysia are playing now - grouping up like a cartel and agreeing amongst themselves to limit home loans to BLR-1.65% (zero entry cost) or BLR -1.85% (non-zero entry cost).
Even my trusty Standard Chartered (SCB) Mortgage1 people are in that Cartel and told me it's non-negotiable even though it'll be my THIRD home loan with SCB if I execute with them.
Sigh... if this was USA, I think we can sue for the cartel for non-competitiveness & manipulating the market prices.

2. ING's fixed rate of 4.85% and friendly lock-in terms beats its nearest competitor AIA.

Decisions, decisions

HSBC's rates VS ING's is about a variance of 1.45%pa.
HSBC: 1 ING: 0
HSBC's rates are variable based on BLR -2.x%, currently 5.5% (crazily low compared to history)
VS. ING's fixed rate of 4.85%
Future possibilities:
Depressed BLR will be climbing up - historical average is about 8%+/- based on 20yrs+ of data
BUT the Malaysian government plans to implement GST in mid 2011, which will hamper economic recovery, thus may severely slow down the rates from climbing.

In my opinion, paying a premium of 1.45% for 2010 to about 2014 to ensure manageable long term mortgage, thus, making my cash flow planning for Casa Subang easier MAY be worthwhile. However, ING's customer friendly lock-in terms are better if I wish to sell the serviced apartment within 5 years.
HSBC: 1 ING: 1

It's currently a tie - I need to meditate on this. In addition to which loan, I've gotta mull over the loan amount to take - I've been offered more but based on my cash flow simulations, I should only be taking RM163K loan to ensure that 9 months rental can cover 12 months mortgage payment.

FYI - the remaining 3 months rental is to buffer for non-occupancy of 3 months per 2 years & annual costs like insurance/MRTA, quit rent/assesment, etc.

Decisions, decisions. Any battle-hardened property investor advice?

Shameless Plug: Personal Money December 2009 interview

2009-12-14T13:01:00.000+08:00

Heheh - finally got my hands on the printed copy. Pure luck being on the same cover page with Dr. Mark Mobius of Templeton Asset Management Ltd. ;P

Properties: Hands-on learning Part 2

2009-12-09T13:01:00.001+08:00

In my opinion, for the working stiffs like me, going into properties investment must be done ultra-cautiously as it is a long term commitment (>=5yrs), illiquid and most of the profits are locked into the property itself via mortgage payments from rental.

Thus, based on the these, hunting and picking only the really worthwhile rental properties - worthwhile in terms of quantitative and qualitative, must be done carefully. At the very least, the cash-on-cash returns must be over and above what I can get from paper assets.

In addition to getting the asset, I think, prudently I should have enough cash for:
1. At least 20% down payment to ensure the expected monthly rental can more than cover the monthly mortgage and monthly/annual costs
2. Legal fees, fixing up, loan fees
3. 3 to 6 months mortgage in case of occupancy issues

Yeah yeah - I'm a pessimistic optimist ;P - plan and work towards the best, be prepared for the worst. Let's see how experiment Properties 101 goes in about 1 to 2 years time ;P.

Properties: Hands-on learning Part 1

2009-12-08T13:01:00.006+08:00

I've just started my hands-on learning in property investment after researching, quantifying what is "worth it" and generally hunting + mulling over the idea. Hheheh - big commitment wor, unlike paper assets, properties are illiquid and are more like locked-in investments for a minimum of 5 years (mortgage loan minimum lock-in period).

Thus, just to share my adventures (hopefully not misadventures), I've detailed below the reasons why I took the plunge in this Casa Subang serviced apartment.

Quantitative Evaluations

Well, it meets 3 out of my 4 criterias and looking at the cash-on-cash returns.. (salivalating).

Qualitative Evaluations
The Good
1. Occupancy rate looks to be more than 60%, eventhough it is school-break, based on my night investigation to check how many lights are switched on.
2. Security.
3. Walking distance to MyDin, Giant, Summit, SEGI College and FUTURE LRT (hope only, not putting heavy scoring on this FUTURE LRT).
4. Within 5km of Taylors, Inti, Carrefour, Subang Parade, KESAS highway & Federal Highway.
5. The property comes with an existing renter - contracted for 5 years, with 3 years+ left.

The Bad
1. It is a serviced apartment - ie. usually considered commercial property unless changed/justified by developer and accepted by local council that it is residential. Thus, a lot of rates are based on commercial rate, not residential.

The Ugly
1. Holy cow - the jam at Jalan Kewajipan can be bad. The consolation is that once past Summit and turned into Giant/MyDin, don't need to suffer the jam further into USJ and Putra Heights.

Thus, based on the above, I think it's worthwhile to use this as my "hands-on learning tool" - having more options in investments is always better when hunting for "value". Any learned property investors care to share?

Personal Money Dec 2009 - whoa.. who's that fler on the cover page ;P

2009-12-07T13:01:00.000+08:00

Heheh - my subscription arrived @ home only on the 6th of December 2009. No wonder some of my friends are poking me and jesting around for an autograph. I didn't think my mugshot will be on the cover (together with 5 others). Nice zit on the day of the shot though bwhahaha.

http://www.theedgemalaysia.com/Subscription/Magazines_teaserAD/PM_teaserad.html

Best-est Books so far

2009-11-12T14:16:00.003+08:00

Just to share the top 5 books, which are I plan to get my Ariel to read in sequence, and my reasoning:
1. The Seven Habits of Highly Effective People by Stephen Covey
These 7 habits form the basis of a good life - in financial, health, spiritual and relationship.
Bottomline: Continuous improvement

2. Secrets of the Millionaire Mind by T Harv Eker
The secret is in the thinking or BEING a millionaire, then DOING what a millionaire does with his time & money and GETTING a millionaire's results
Bottomline: Money management + thinking like or being a millonaire = more important than just doing what a millionaire does (business, investing, taxation).

3. Cashflow Quadrant by Robert Kiyosaki
The differences in cash flow for employees, specialists/professionals (self employed), business owners & investors.
Bottomline: It's better to be on the business owners and investors quadrant - even if I'm currently an employee, I can have a few fingers or a foot in these two quadrants.

4. How to Make $1,000,000 in the Stock Market Automatically by Robert Lichello
This book has 2 main formulas, TwinVest and AIM, which uses fluctuations of the market to make money, logically. These formula are based mostly on consistency and Value Averaging to win more and lose less.
Bottomline: Don't fight the fluctuations of the market, use them as we do not know how high is high and how low is low - unless you've a crystal ball (may I borrow for awhile? ;P)

5. The TRENDadvisor Guide to Breakthrough Profits: A Proven System for Building Wealth in the Financial Markets (Wiley Trading) by Chuck Dukas, T. Parker Gallagher, and Ralph Acampora
Since investing and trading is a "human" activity, one can use Trend analysis to gauge the general market, sector, stock, mutual funds, etc.
Bottomline: The book sells you the idea that trend analysis, in and by itself, is a "killer application" but trend analysis as part of a two or three factor trigger works best - eg. Sell Rules: Trailing Stop Loss & Trend, Target Profit taking % & Trend, etc.

Read any good books lately? By the way, I deem the first two books as soooooo OMPH! that I buy several copies of them during book sales and give them to my team members and close friends. Wait lar - when I'm a multi-millionaire in POUND STERLING terms, then I'll buy and give them away to all friends & acquaintances ;P

Big Picture / Map Revisited - without which, we get lost in day-to-day details

2009-11-10T13:03:00.002+08:00

Sorry for being off-line for awhile - big reorganization & additional areas to handle in my working life.

Hehheh - thanks for your kind feedback. A lot of friends & readers said: "Holy cow! Can you like SIMPLIFY all these? Lots of things to digest and it's everywhere."

Being an IS engineer by training, I think the problem is solved with the picture below. This big picture / roadmap is my own personal approach - the gist of which is:
1. Must have money management
2. Must have some overall strategy / approach for all investments
3. Must have specific buy & sell rules (methodologies) to achieve overall strategy.
4. Track track track. If you do not track your net worth + investment transactions, you will not know how you are doing, what works, what doesn't & adjust your heading accordingly to reach your goals.

Please do advise if the below is useful yar.

To Sell or Not to Sell

2009-06-19T13:00:00.000+08:00

A friend of mine, SY, asked whether she should sell off her ING Annual Income Climate Structured Fund yesterday as her net profit is approximately 16%+ in 8 months+/-. What do you think?

Me - I asked for more information like:

What kind of fund is it?
Her response: Capital protected fund with guaranteed minimum returns of 5% per annum for 3 years.
What was her goal / intention when getting into that fund?
Her response: For income generation + a possibility of bettering 5% pa.
Any ideas / opportunities for the lump sum money if redeemed / sold off?
Her response: Yup.
Hungry for much better returns than the current if sold/redeemed now?
Her response: Nope

Hehehe - after asking the above questions, she herself already answered her own question of whether to hold or sell / redeem. Sometimes, I think it's not that we do not know the answer we seek, but we may have asked ourselves the wrong question or lost our targets / goals / reasons for getting into something (not just investments) ;P.

What other questions would you have asked?

Stock Market Jitters - Time to start looking for investments on Sale

2009-06-17T07:30:00.000+08:00

It's that time again - FEAR and uncertainty is sinking-in after the stock market had a fast & crazy run-up for the past few months. Again, my friends & aquantances are having fear & uncertainty - hm.. smells like time to look around for investments on Sale ;P.

Another friend of mine, PL who's in Singapore, is also going "Woohoo! I'm going to get me a piece of that action. " as she said she "missed" the fast & crazy run-up. Heheh - the total opposite of the Fear factor, greed :D.

Me, I'm in blah blah land (as opposed to la la land ;P) - ie. Neutral (neither estatic or scared shitless) because I believe:

There will always be ups and downs in the market.
Money can be made when the market falls (even without shorting stocks) by selectively picking stocks of companies with good fundamentals and preferably history of consistent dividend payouts which are less than their earnings (if dividends being paid out are more than earnings consistently, something doesn't make sense, right?)
Money can be made when the market runs-up by selective profit-taking and divesting into bonds, REITs, etc AND/OR by riding the latest / fastest trend wave.
In any case, there is always a need for a "big picture" approach like Asset Allocation + exit points before getting in - not JUMPING in with >80% of my capital.
Neutrality allows me to be unexcited and think things through a bit, a definite plus for investing but may be too lacksidal for trading.

Mind you, I am too human at times and do get caught-up with things too, thus, ohm... ohm... need to neutralize.... :D.

By the way, anyone cares to share their views on the coming spike in inflation or deflation? Me - I'd bet on crazy inflation because of simple reasonings:

Printing money like crazy... hmm..
So many people, so little basic resources to go around. Yeah, commodities are now looking down-ish again but I'm betting population growth > resource growth in the mid-term (5 years)

Children and money management: hands-on experiment and experience

2009-06-15T19:00:00.001+08:00

I've just started-off Ariel with some simple money management - allowance $2 per week, $1 for saving (accumulated in jar 1) and $1 for fun spending or accumulation for future spending (purse in her bag). I keep asking Ariel to count the dollar notes each week as she allocates her additional savings into the jar, then tell her Papa will give extra $1 when there's $10 inside. Must give some incentive mar, right? :D

So far, she understands the value of her money as she can go on rides (merry-go-around in Ikano $1), buy lollipops/ice-creams ($1) and some "big ticket items" like sticker books using her accumulated unused fun spending money. Heheh - imagine me explaining the numbers and values in terms of weeks to her when she wanted to grab a big puffy Barney soft toy costing $70+.

I say, I still do buy her books and pay for funducation classes out of my own wallet, not her purse but all the "guilt" associated with toys and stuff (non-educational / safety / growth) are gone. Hheheheh - transference of "risk" as the insurance industry says (mine's "guilt") + education in value and handling of money for Ariel.

Marriage, wedding and a new partnership - just some thoughts & cents

2009-06-14T23:59:00.002+08:00

Quite a few people I know are getting hitched within July 2009 till Jan/Feb 2010. A couple of them are divorcees, having gained the courage and want to try build a life with another. Me - I'm still very very selective (yeah, I'm a divorcee too).

A few of these couples getting married have been partners for quite a while (more than 3 years) while some have known each other for less than 6 months - not even a full 4 seasons! I'm just wondering whether they understand what their signing up for - commitment to each other... until someone gets stabbed in the back or basic agreed principles broken (ah.. sweet memories ;P).

Ok ok - back to the topic at hand. Marriage, wedding and managing these costs:

Cost of Wedding
Hm.. big bash gathering where you MAY make a profit, break-even or loss. Not very good probabilities - even if you profit, the restaurant profits more than your guests and you. I'd rather allocate most of the money to creating a new experience with my new partner - honeymoon, or pre-pay our new home.
Cost of Studio / Outdoor Photography
From personal experience and friends' sharing, after the first two years, these are often kept in the back of the wardrobe or somewhere, never to see the light of day (or artificial lights for that matter). However, as a "captured on photo" experience with natural, "unartificial" photos would be a touching keep-sake for the lady. Good to spend on this but not crazy % of your total cost.
Cost of Honeymoon
Yeehaa! This is where I'd plonk most of my money as this creates shared experience with your partner at some place which both of you want to visit.
Cost of Dowry
Some older tradition followers demands this. No issues as long as the amount is used to build the partnership's home in the end of the day.
Home
I've seen books recommending, monthly mortgage from 35% and below to 20% and below your gross or net income OR a total cost of not more than 2 years' gross income, as the "safe" rule-of-thumb.
Personally, I've bought 3 houses and sold 2 of them, all for living-in. From my own experience, it's best to keep your mortgage below 20% of your monthly net income, income which you are "for sure" to get (as long as you don't screw things up). With such a low commitment, you never have to worry about debts - even "good" debts.

By the way, I don't suggest you buying "as big a home as possible" assuming you'll be living there "forever". Again, from experience, I did that with the same thinking but within 7 years I moved twice. In addition, such a huge commitment may cause your partner and you sleepless nights and may eat you alive ;P

Bottomline - you want a home or you want a "thing" that you work your ass off to finance?

How did I finance my ex-marriage several years ago? Simple - from my bonus, after taking my cut of prepaying my mortgage and a few other necessities. If I were to do it again (who knows I may bump into someone perfect for Ariel and I ;P) I'm accumulate the money in my "Specific Goals" account for two years and spend as above.

All constructive criticisms and feedback are welcome via the comments feature in this blog.