How to maximize your savings

I don’t know about you, but I do find it harder to save money now than ever before. For the first 8 years of my working life, I had never saved a single cent. We live in a consumerist society whereby we are constantly being tempted with products and services, promising us a more fulfilling life, with many buying into the story of how materialism can brings us happiness. From driving luxurious cars like BMW to Audi being the epitome of success, to owning designer brands like Chanel and Hermes to showcase a woman’s high earning power. Like the saying goes, “fake it until you make it”, people are flaunting what they own materially to make themselves look good and feel good. More and more people are going into debt as a result. I was one of them and recovery was painful. The path to wealth accumulation is actually a stimulation of simple steps, attainable by most.

So how does one accumulate wealth the sure but steady way?

1) Track and cut down on expenses

I used to wonder where all my money went at the end of the month, leaving me pretty penniless and having to live on credit. Tracking of expenses helps to add up my individual expenses to see where my money went exactly, and I was surprised at how much money I spent and how much the small stuff can really adds up. For example, I used to buy dresses from online shops thinking it’s just $30 for one dress and before I knew it, I spent over $600 on shopping just for one month. If you’re like me and are constantly wondering if there’s a silent thief quietly stealing all your money away, you better start tracking your expenses. You’ll be surprised at how much you spent on eating out, on a months’ worth of Starbucks coffee, or on taking cabs each month.

2) Develop a budget and stick to it

After tracking your expenses for a month or two, spending patterns should emerge and you now have a clearer picture on where your money goes to each month. Categorize spendings into different types of expenses incurred. Start recording your monthly income.
Salary – Expenses = Savings
I know you’re probably laughing at this simple equation. But how many of us are fully aware that having wealth starts from the leftovers from our earnings? Start looking on where you can cut back on and trim accordingly. The greater the balance is, the more money you are able to save. Many people yawn at the thought of following a budget but every business and corporation has a finance department and a budget in place for very good reasons. After tracking my expenses and sticking to a budget for a few months, my savings actually start to grow and I realized it’s actually possible to accumulate wealth. It just requires discipline and sacrifices.

3) Automate your savings by paying yourself first

The very first thing I do when I get my salary is to transfer a portion of it into a separate (untouchable) saving account. After a few months of sticking to a budget, you should be comfortable enough to know how much you need to set aside for living expenditures. However, do remember to budget for adhoc/ surprise expenses like birthday gifts for friends and family members, for festive seasons, renewal of yearly health insurance, provision for yearly vacations etc. This is to avoid digging into your savings/ emergency funds when these situation arises.

4) Earn more

There’s only so much you can cut back on, but there’s literally no limit on how much you can earn. (Stop complaining, you can always get a part time job if you are too poor to save money after covering basic necessities.) Over a one year period, I have optimized on cutting down on unnecessary expenses and am saving exactly 20% of my monthly salary. However 20% is just the bare minimum on how much we should be saving, and I’m working on maximizing my earnings. I aim to complete my ACCA by the end of this year, and the qualification has the potential to earn me a higher salary and a brighter job prospect, If your company is giving you a 3% increment every year and you’ve been with the company for over 5 years, then it’s probably time to ask for a promotion or seek greener pastures. Always upgrade yourself and learn whenever the opportunity arises.

5) Widen the gap

Aim to widen the gap between your income and expenses. The bigger the gap is, the greater and faster your savings accumulate. Avoid lifestyle inflation by not treating your salary increment and bonuses as an increase in spending power. While it is important to reward yourself (by spoiling yourself to something you’ve always wanted using the first month’s increment, or a small part of your bonus), do treat the increase in salary as a chance to save more. Or rather, ignore the increment and spend as budgeted, as though you did not get a raise at all.

6) Stop comparing with others

There will always be people driving fancier cars, owning more designer bags or living a more glamorous lifestyle. They may be earning more, have lesser commitments, or simply just come from rich families. Life is unfair that way. Comparing in term of owning material goods get you nowhere close to having a million dollar anytime soon. Prioritized and understand what is important to you. Is having a comfortable retirement and not having to worry about your child’s education more important than owning countless Hermes bags?

7) Avoid debt

I never get to save money when I was in debt. Simple reason being interest and late charges always eat into the little savings that I had. Being in a 18k debt means a couple of hundreds of dollars flushed down the drain (and into the banks’ pockets) every month. Now I avoid new debt at all cost and pay my credit card bills on time every single month. If I find myself thinking of breaking up my next purchases into installments, it means I just can’t afford it.

8) Invest regularly and prudently

Saving money is great. But remember banks pay you peanut interest of between 0.05% to 1% (for the case of fixed deposit) for parking your money with them. Once you have built up your emergency fund (I’ll talk about emergency funds in another blog post), invest the excess cash to earn more than the pathetic interest from banks and slowly accumulate/ reinvest to generate passive income for retirement. Don’t know what to invest in? While I’m no investment expert, I do recommend buying ETFs (exchange trades funds) to gain access to a pool of underlying assets for diversification which earns a dividend return of 2-3% annually. Instead of buying blue chips, the STI ETF pools together investors’ resources to dabble in a mixture of blue chips like the major banks in Singapore (DBS, UOB, OCBC), Singtel, Starhub, Keppel Corp, Jardin, Sembcorp, Capitaland, Olam, Noble etc. This ETF is also a close reflection of how the Singapore economy is performing.

So there you go. These steps worked for me, and I hope they work for you too 🙂

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Wedding Budget

Wedding is one of those life events that depletes or eats into a major part of our savings. Albeit money well spent, it is important not to go into debt for just a one day event. Having been debt ridden, I was extra careful and one of the very first thing on my planning list was to work out a budget even before we started on our wedding preparation.

Our Wedding Budget

Our Wedding Budget

(Do note that I did not include the cost of my engagement ring, dowry price, betrothal gifts and red packets collected as these are subjective and confidential.)

Areas we saved on:

1) We decided on a lunch banquet for our wedding because we refused to pay 30% more for dinner at the same hotel, for the same ballroom, and with everything else being the same just because one was held during the day, and the other at night.

Amount saved: $8,845.20 (Lunch costs $968++ per tables, Dinner at $1,238++ per table)

2) Instead of going to a dental clinic to have our teeth whiten at $1,000 per person, we decided to purchase one of those Groupon vouchers at $99 each. I would say it works as our teeth were a few shades lighter, but more sessions are recommended for better results.

Amount saved: $1,802.00

3) We also saved on paying for a Solemnization Venue by having our solemnization done in the hotel. However, do note that some hotels do charge a rate ranging from $2,000 to $5,000 for using their venue outside of the ballroom. Goodwood Park hotel actually quoted me $3,000 to use their poolside for solemnization.

4) I didn’t get a wedding ring, and instead, my engagement ring also served as my wedding ring as I find it unnecessary to carry both rings. I also couldn’t find something that I really fancy after countless trips to the jewelry stores, and did not want to buy a ring just for the sake of buying.

Amount saved: $2,000

Areas we splurged on:
1) We engaged a 3 piece live band to play live music on our wedding day for a short span of 1.5hrs at $1,498.00. However, we felt that it was worth it for the nice ambience the live music had created and many guests actually enquired about the band after.

2) Dessert Booth and Peking Duck Booth. These are pre-lunch reception treats that we ordered for guests who arrived early, as by the time the lunch banquet officially starts, it’ll be close to 2pm already.

3) Rental of additional wedding gown at special rate of $500 from our bridal studio. Our wedding studio provides us with 2 actual day gowns but I wanted another gown for my solemnization. Although I admit it was quite a splurge for renting a gown that I only wore for less than 2 hours, I REALLY liked it and had budgeted for it and $500 was actually a steal with additional gowns costing from $800 to $1,000 each usually.

Costs we could have avoided:
While the above costs are splurges which we willingly paid, the below items could have been avoided as they have no added value to our wedding.

1) We topped up an additional $1,500 for extra 12 photos and for all hard copies for our pre-wedding photo shoot. Post wedding, we did not even bother to look at the photos again and felt that this amount could have been for better use.

2) We also topped up an additional cost of $500 for a more senior photographer (an Art Director featured in the Tatler magazine) to shoot our pre-wedding photo shoot. This was a total waste of money as the photographers are actually all equally good, and we weren’t exactly pleased with how the photos turned out as well.

3) I bought a Chanel earring for $490 for and only wore it once since my wedding. It was totally unnecessary, and now I feel like selling it on ebay already.

All in all, there was a potential $2,490 which we could have saved on.

I hope my unmarried friends could use this to plan their wedding better, and do remember not to get overly caught up in a one day event, as after all, it is the marriage that matters the most.

Happy planning!

Our Wedding – Lunch Banquet

I can’t believe 3 weeks flew past just like that! We were busy for months before our big day on the 19th of Jan’14, and before we knew it, it was over. Thank goodness we have some nice photos to look back on 🙂

I have previously posted my morning highlights photos here, and shall proceed on to include more photos for the lunch banquet held at the Intercontinental Hotel.

Cocktail Reception

Cocktail Reception

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Beautiful ladies tending to the reception counter

Beautiful ladies tending to the reception counter

Johan, one of my closest friend EVER

Johan, one of my closest friend EVER

Oops, that's my boss lol

Oops, that’s my boss and he sure looks awkward lol

The Dessert Booth

The Dessert Booth

Touching up before the first march in

Touching up before the first march in

Touching up before the first march in

Touching up before the first march in

Feeling jittery

Feeling jittery

With our close friend Kenny before the march in

With our close friend Kenny before the march in

With Joanne & Doink who go married a year before us

With Joanne & Doink who go married a year before us

With Miko and Weixiang, who are getting married 4 months after us

With Miko and Weixiang, who are getting married 4 months after us

Anxiously waiting for our cue to march in

Anxiously waiting for our cue to march in

FINALLY~

FINALLY~

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As the song “From This Moment’ is playing in the background…

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I wish this moment can pause forever

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🙂

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Giving the camera a cheeky smile :p

Cake cutting ceremony

Cake cutting ceremony

Fun fact: Prior to this, I totally wasn’t aware that there’s a slot for the knife and the whole cake is FAKE! LOL!

My lovely friends making a speech. Love you girls!

My lovely friends making a speech. Love you girls!

Obviously touched by their speech

Obviously touched by their speech

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Love the soft lighting of this shot

Love the soft lighting of this shot

Another close friend of ours making a speech

Another close friend of ours making a speech

And this time I really cried

And this time I really cried

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Wish I could share her speech here. Or maybe I should…

The lovely band is playing while we were upstairs changing

The lovely band is playing while we were upstairs changing

Our 2nd march in

Our 2nd march in

Time to pop the champagne!

Time to pop the champagne!

Popped!

Popped!

Champagne pouring ceremony

Champagne pouring ceremony

Love the view of the ballroom

Love the view of the ballroom

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Finally it's our turn to make a speech...

Finally it’s our turn to make a speech…

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My new family

My new family

My lovely family

My lovely family

With some of our closest friends

With some of our closest friends

Buddies forever!

Buddies forever!

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More great friends

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More great friends

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Check out my murderous look when we were “forced” to drink

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Cheers!

My da jie (big sister)

My da jie (big sister)

Love these folks!!

Love these folks!!

Another murderous given for the day

Another murderous given for the day

And this is me saying to  Cherie, "it'll be your turn in 6 months time".

And this is me saying to
Cherie, “it’ll be your turn in 6 months time”.

Cheers to friendship!

Cheers to friendship!

And this is how I cheat by pouring champagne back to their glasses

And this is how I cheated by pouring champagne back to their glasses

And this is how I cheat by pouring champagne back to their glasses

And this is how I cheated by pouring champagne back to their glasses

Yeah!

Yeah!

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My lovely ex-colleagues and finance girls

More ex-colleagues from SocGen

More ex-colleagues from SocGen

And these are my favourit-est people of all!

And these are my favourit-est people of all!

 
My current colleagues
My current colleagues

My current colleagues

Friends from my school days!

Friends from my school days!

My cute colleagues!

My cute colleagues!

Gosh, I love this picture!

Gosh, I love this picture!

These are the folks I know I can count on for ANYTHING

These are the folks I know I can count on for ANYTHING

My favourite girls!

My favourite girls!

My favourite babe :)

My favourite babe 🙂

My secondary school bestfriend

My secondary school bestfriend

Hugs!!

Hugs!!

Family

Family

Commandos!

Commandos!

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SocGen rocks!

With pretty mama Adelyn

With pretty mama Adelyn

Thinking back, I really really had a lot of fun during my wedding. It felt so good to see so many relatives and friends, and Andy and I are so fortunate to have everyone’s blessing. We are lucky to have a group of close friends who made sure everything runs smoothly.

One last note here, a wedding is definitely a joyous and magical event. However, as someone who writes about personal finance matters, I’ll like to emphasize that a blissful marriage is what really matters. After all, a wedding only lasts a day while a marriage is for a lifetime. Therefore, it is critical to spend within one’s means for one’s wedding. Money arguments between couples are the top reasons why a marriage fell apart. Don’t let that happen to you, handle your marriage and your money well.

Cheers!

Our Wedding – Morning Highlights

It has been 3 weeks since my wedding day and it’s been awhile since I’ve blogged! Immediately after the big day, I fell sick, probably due to all the excitement and from lack of sleep. Upon recovery came the Chinese New Year, and we were all busy preparing for it.

I’m looking back on my wedding with fondness and I sure had lots of fun! Now, lets enjoy the photos!

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My gorgeous gown

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Getting ready at 5am

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Now I’m all set and ready!

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My handsome Dad

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The band of brothers

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They are so smart looking aren’t they?

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The impatient sisters are waiting for the gatecrash to begin.

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Time to give some red packets

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What? Only $2?

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And Wen Dees managed to snatch more red packets

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Time for some sour shots!

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Sweet sweet sugar sticks up next

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Followed by bitter and spice

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Cheers!

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And someone’s caught cheating, thanks to the camera man

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It sure looks spicy!

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And now time to clean their pores…

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And some lippy for the groom?

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Muack!

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And here’s another sweaty kiss. Muack!

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And he comes my dashing groom, after the gate crash he went through.

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With my pretty sisters

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Time to head out…

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For photo-taking at Gardens by the bay

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An extremely happy day for us 🙂

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Love this candid shot!

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The brothers and sisters

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Time for me to throw the bouquet!

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1, 2, 3!

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And Miko got it!

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With gorgeous May!

I’ll be posting more photos soon!

Who I Am

I recently share this on Facebook and thought I should share this on my blog as well, although it’s totally not financially related in any way. And oh yeah, I cut my hair right after my wedding. Short hair rocks!

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During my teenage years, I was busy trying to be someone I was not. Trying to fit in, trying to be popular.

I spent the majority of my 20s trying to figure out who I am and what I want, and trying to impress people that doesn’t matter. I got upset whenever I learnt that someone disliked me and I’m always trying to gain the approval of other people.

During the later part of my 20s, things started to fall into place, and I stopped caring so much, about what others think of me, stopped trying to impress people whom are not close to my heart. I learnt how to read people and to trust them less easily.
In my late 20s, I feel like I’m finally comfortable in my own skin. I no longer feel uncomfortable lunching by myself, or just being by myself. In fact, I enjoy my own company now, to read or just to reflect on things. I was an inner geek when I was young, and this is who I am. I’m the happiest when I’m reading or learning new things. I crave for knowledge and answers like I crave for oxygen.

Environment and society had shaped me in some ways too. I became a social butterfly, I cared too much about my looks, I became outspoken, and was too fun loving. For awhile, I struggled between being an introvert and an extrovert at the same time. I’m an introvert by nature, and an extrovert by nurture. Now, I know it’s perfectly fine to be both. I ignored my phone when I need to be alone with a good book. I’ll go for drinks or dinner with friends when I need to be surrounded by people. But the first and last thing I need to do every single day and night is to read. I am that passionate about reading. For it is through reading that I find answers, satisfaction and growth.

I am also someone who embraced changes. I feel suffocated when my job is stagnant, when there is no challenges at work and no new things to learn and overcome. For this fact alone, I know that I can never be a stay at home mom or wife, and I’m glad my husband recognize and respect that. I like to earn my keep and not rely on anyone financially. In fact, I enjoy the process of accumulating wealth and I know I’ll become fairly well to do one day, through my very own effort.

Friends who knows me knows that I have a need to change my hairstyle every now and then. But few really understand it is to represent the notion of my need for constant change and improvement. At the same time I need a stable relationship, a man who is always there for me, and now that man is my husband. He is someone I can rely on amidst the unpredictability and challenges that I craved for in life.

I have a new found passion too. The topic of personal finance and early retirement interest me greatly. I get excited talking about investments and about properties too. I dream of gaining freedom from having to work for the sake of money alone. I want to enjoy doing many different things at the same time, whenever I want to.

Now a little bit more about the extroverted part of me. I like making friends and meeting new people. I think it takes all sorts to make the world and I love how colourful our world is. People are like characters in books and I can learn so much from all the different characters I met. I am always curious to know the thought process of others, and why they are the way they are. Friends say I can befriend anyone and everyone easily. I guess it’s because I have a genuine interest in people and can relate to them easily.

I am girly in appearance but I’m like a tomboy at most times. I’m not afraid of snakes, lizards, worms or spiders (the only creatures I’m scared of are bees, don’t ask me why). I hate to shower cos I find it so troublesome. I like watching horror shows, and I like looking at pretty girls too, much like a typical guy. But don’t worry, I am 101% straight. I just like to admire beautiful things and people.

As for my favorite sports, it has got to be running. I don’t have to interact with anyone and can be lost in my own thoughts when I am running. This is also the time when I figured most things out.

I think recently I fell in love with writing as well, although my grammar isn’t fantastic and my vocabulary isn’t exactly fantastic too. Writing helps channel my thoughts into words and it just felt comforting to write. Hope I’ll get better as I write more blogposts.

Cheers!