Author: A Singaporean Stockmarket Investor (ASSI)

An average HDB household and $1 million.

Some might remember that I talked about an article written by Cai Haoxiang in The Business Times in 2013. He wrote about what an average household’s monthly expenses could look like in 2042, using the Household Expenditure Survey 2007-2008 from the Department of Statistics as reference. 1997-1998, an average HDB household’s expenses was S$2,681. 2007-2008, it was S$3,138. That was an increase of 17%. By 2042, if core inflation is 2% a year, that number would hit S$6,400. In 3 decades, the number doubled and then some. If we were to assume that costs would increase steadily, monthly expenses...

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Deposit for 5 years 11 months for higher returns?

Some readers might remember this blog post: http://singaporeanstocksinvestor.blogspot.sg/2016/06/mom-stunned-at-what-happened-to-her-cpf.html My mom has met the minimum sum for her cohort and she has also maxed out her CPF-MA. So, guess what my reaction was when she sent me the following SMS: “I went to XXX bank because my fixed deposit matured and they asked me to deposit for 5 years 11 months. Get 1.6% per year for first 5 years, Balance 11 months see how is performance. Get minimum 1% and maximum 2%. Principle guaranteed upon maturity but suffer penalty if withdraw before maturity. Can put or not?” Noooooooo! A thousand...

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Earn $350K a year and on track to financial freedom.

Hi AK, I hope this email finds you well! I have been your loyal reader for the past 2 years and have written occasionally to you. I like to share one additional perspective to achieving financial freedom which have not been written as much in your blog I believe: Focus on maximizing your earning potential so that you have a nest egg to use to achieve financial freedom I manage to develop my career in a niche field that is sought after and relevant- currently, I am making S$350K per year and will take 3 years to make S$1mil...

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Tea with Matthew Seah: Margin of safety.

Matthew shares with us a simple and important concept to invest more safely: The intrinsic value of a company could be calculated base on our estimations of various aspects of the business, both tangible and intangible. Hence one would require to look at both qualitative and quantitative aspects of the business in order to give a more holistic valuation of a company. Company valuation can be done using 2 broad types of valuation models: – absolute valuation; and – relative valuation. Absolute valuation is a valuation method that give you an absolute value to compare against the current market...

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Thinking of moving out of the family home?

Dear AK, As we know, Singapore citizens can buy a HDB if they are married. If they remain Single, they can get a flat at 35 years old. Each citizen cannot own more than one HDB at any point in time My father passed away some years ago, and I co-inherited the HDB with my mum. Hence, I am the half owner of my parent’s HDB apartment. I do not get along well with my mother, and I wish to move out as soon as possible. However, as I am already an owner of parent’s HDB apartment, I will...

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This condo investment has been a drag.

Reader: Hello AK, I read many of your interesting articles on your blog on financial matters. I would greatly appreciate some advice to manage my finances. I turned 55 and am still working. I live in a 3 room HDB flat fully paid for. I purchased a 2-bedder private condo in the east for investment purpose and renting it out since mid 2015. The rental is covering my mortgage loan but the other expenses such as property tax, home/fire insurance and maintenance/sinking fund amount to $7000. I am thinking of letting go this property… AK: If you are concerned...

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Have a fully paid HDB flat and make money.

A friend told me he is seriously considering selling his fully paid 5 room HDB flat in RCR to buy 2 shoebox apartments so that he could stay in one and rent out the other for cash flow. Hopefully, property prices would go up and he could benefit from capital gain by selling one. I told him that he would be moving from being debt free to being indebted. There is no guarantee that the monthly rental could cover the mortgage payments (plus the much higher monthly maintenance and property tax of a condo). He says he just wants...

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Dividend for FY 2016 and for life is a waste of time?

Most of us are not born with a silver spoon in our mouth. We have to find our own way in life and, hopefully, we do not end up in hole full of snakes or spikes. Snakes are natural while spikes are man made. Yes, there are people out there who are hunting other people. We have to learn and avoid such holes. How to get rich quick? Don’t ask me. How to get rich slow? See this? Yes, it is something I am reminded of on a yearly basis. This is money I stashed away donkey years ago...

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Old Chang Kee recorded a big loss in Q4.

I received a small handful of messages regarding Old Chang Kee’s latest results and this is a quick blog about the matter. Old Chang Kee is a fantastic cash flow generating machine and it remains one of my better although smaller investments. I have no intention to let go of my investment because nothing has changed. Of course, when I saw the article in The Business Times declaring a huge loss for Old Chang Kee in Q4, I took notice. I spent one minute looking at the financial statement and decided that all is well. One minute? Yes, only one minute....

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Hock Lian Seng should be 69c a share.

Reader: A senior of mine at work told me about your blog when we chatted about stocks. I mentioned Hock Lian Seng and he said AK blogged about it. I bought this because my broker told me it was worth at least 69c and that there was a special dividend. I paid 62c but the price has plunged. I wonder if I should hold or sell or buy more. If you are wondering, I just started investing this year and I don’t know who to trust now. AK: Trust yourself. Trust no one else, not even AK. I have...

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Still making money in Croesus Retail Trust. Peace.

Hi AK, I wrote to you a few months ago and told you a prominent blogger sold all his investment in Croesus. I asked you if you would be selling too. You gave me one of your typical AK answers. Now, a few months later, I am kicking myself because I sold half of my investment since I was not sure if I should stay fully invested. It was my biggest investment. If I had your conviction, I would have avoided this loss… Hi R, I have the feeling that you might not have understood the investment enough to...

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Accordia Golf Trust and lower DPU.

Reader: Hey AK, what do you make of Accordia Golf Trust latest results? Looks pretty dismal, all important numbers are down. Any positives to it at all? AK: eh… you say leh? Reader: From the numbers I don’t see anything good. But management says that tourism may have a positive impact in mid to long term And they said there was bad weather, maybe the weather might improve. That’s about all the good I could see from the report AK: I would ask if the dip in results is due to something more enduring. If so, the decline would become...

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Sino Grandness and rights issue.

Reader: Just checking can you comment on SINO GRANDNESS rights issue? Is it worth subscribing to the rights? Thanks AK: Always ask what is the reason for issuing rights. It seems like they have trouble repaying debt and, hence, the rights issue. If so, the rights issue does not add value for investors. Subscribe if you believe that the company is able to do much better in future. Reader: ok thanks for the advise. AK: If you are putting in more money but the performance declines, it is a bad deal. Reader: yeah Remember, not all rights issues are...

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Buying a freehold property in Singapore is still worthwhile.

Reader: Hi AK,         Hello! I only found out about your blog in Jan this year and have benefitted a lot from your analysis and sharing.          I have been reading your recent posts about upgrading to private housing. I happen to work in a landuse planning agency, hence i would like to share my views.  While i agree that one should not upgrade to a condo if it means overstretching your finances, i think getting a freehold property might be the only way to preserve the value of your property. For 99 year leasehold properties, they would eventually...

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When the lease on my HDB flat ends.

What happens to our CPF money used to buy a HDB flat when the lease ends? Reader: can I assume that whatever has been used to pay for the flat will be forfeited and we still need to pay back the accrued interest? I have friends who are paranoid over the lease issue cuz they keep on reading the anti hdb and anti CPF articles. End up frightening themselves. AK: Tell your friends it is the same anywhere in the world. Leasehold means there is a limited life. Once it is gone, it is gone. Money from CPF used in...

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