Saturday, February 3, 2018

Building my stocks portfolio

Hi everyone!

After a Long period of time, finally I have some spare cash to build my own portfolio from scratch. Previously I divested all my holdings due to purchasing of property and renovation (of course keeping sufficient emergency funds as well).

This week, I have been loading up some shares which I believe is still in fair value despite the rise in STI (from 2600 level to 3500 level) really impressive jump. Although I did missed the opportunity to make some capital gain but still no regret as I am really happy with my new home.

I am more towards building dividend portfolio rather than capital gain portfolio as I prefer to build a stable passive income through dividends. So currently I have bought some shares to start off with my portfolio. Below are the shares

1) SingTel - 300 shares
2) Netlink NBN trust - 1000 shares

Just bought a small amount as I am just getting ready to purchase and currently the market seems like going down (bear market) so will buy more if the price is right. I am still aiming for some shares like Keppel DC REITs, FCT and etc. These are some of the shares that I plan to have in my portfolio. Hopefully can get it but this year, with the best price of course!

Slow and steady wins the race, no need to rush all in. Just follow your pace and you will naturally build your own desired portfolio.

Wednesday, January 24, 2018

My Journey Of Purchasing My First Property [Part 2]

Hi Everyone!

This is the continuation from the "My Journey Of Purchasing My First Property [Part 1]" post, whereby I wrote about the first portion of my journey of purchasing my first property.

1) Process of Purchasing a property

So after we decided on the property to purchase, we got our agent to conduct the next course of action, which is negotiation. We did negotiate quite a substantial amount as the seller wants to follow the valuation price and forgo the listed price. However, we still manage to get the property a bit lower than the valuation. So after negotiation, we will need to do the following

 - Pay 5% down payment (cash only)
 - Pay 15% payment (cash + CPF)
 - 3% or 7%(depending on ABSD, ABSD only applies to buyer who purchased second property, be it HDB or private property)
 - Lawyer fees
 - Valuation fees
 - insurances (if needed)

So we paid the 5% to the buyer to exercise the OTP (option to purchase), along with the caveat. So many might asked, what's OTP and what is a caveat? An OTP, occurs when you want to exercise the purchase by making the 5% deposit. A caveat is a legal binding to both buyer and seller, especially to seller. This would means that the seller must adhere to this purchase, and cannot accept any other offers within the purchase period unless buyer backed out. Buyer does not have any effect on this caveat, just that the buyer will lose the deposit.

After which, you will need to hire a lawyer to help you to settle the legal stuff and payment stuff including signing the contract, passing the 5% down payment and inform the amount that you wish to deduct from CPF for the 15% down payment. Until then, will have to wait till 8 weeks to 12 weeks for the completion exercise to end.

So how about lawyer fees, valuation fees and stamp duty? is it counted inside the purchase price? Unfortunately, these are the addition fees that you have to pay on top of the purchase price. The lawyer fees should be around $2500 to $3500 (depending on what kind of service you expecting), of course we go for the lower one. For the valuation fee, I think is a standard fee, this will be done by the bank that you loan money from (to pay the 80% of the property).

For Stamp duty, it is 3%, the calculation is at this website (stamp duty calculator) -, if you have existing property then you will have to pay the ABSD.

2) Bank to loan money for purchasing property

Next step is to get a bank where you can loan money from. there are many banks in Singapore (UOB, OCBC, DBS, Maybank and etc.) Each bank will have different ways to calculate the amount to loan you. You need to submit your income statement, credit card information and etc. from there, they will calculate how much that you can get a loan from. Do note that they take into consideration of the number of credit cards you have (it doesn't matter if you didn't use - that's what I think)

So after a few assessment done by different banks, I decided to go for UOB for the housing loan, as they go by fixed deposit rate, which is quite low (which means good!).

So after which, they will bring along an insurance agent while signing the housing loan contract. Do note that you do not need to obligate to sign the housing insurance from the agent (it's optional).

So with this, I have conclude the chapter of purchasing the property. Soon, we will update about the renovation process.

Friday, January 5, 2018

CPF - Should you or should you not

Hi everyone!

Once again, the period of getting interest from cpf is here. Not everyone is excited but I am cause I am looking to every single ways to make my money working for me and getting interest/dividends are one of the ways!

So you might ask, do I even top up my cpf and if yes, how much do I top up every year? Personally I don't do any top up cause I don't have much savings to put in cpf especially I need more cash flow in the future (for my family). However, once I have extra savings, I might put some in cpf and the rest in other instruments.

Some people might asked, cpf money, you will not be able to withdraw until 55 years old. It's like can see but cannot touch, is it that worth it? Some people might see cpf as a liability as part of their salary are credited to cpf and they are unable to touch it. For me, I treat cpf as a long term saving program (especially for SA account) as it helps me to save and also earn quite a good amount of interest.

How about transferring OA to SA? Is it a good choice? Firstly, there isn't a fixed answer for this as there are pros and cons in transferring OA to SA. Let's say you are still young and want to build your family in the near future like buy a house and etc, I would suggest not to transfer your OA to SA yet until you have sufficient funds for it. The reason is because transferring from OA to SA is an irreversible move, once you transfer to SA, you won't be able to transfer it back to OA. So settle your big item first that requires your OA funds. After which, you can slowly consider how much to transfer in order to earn the attractive interest of 4% (extra 1% for the first 60k)

Will JYKL be doing the transfer? Yes, I will be doing it soon as I want to earn more interest in my cpf account by putting it more in SA cause the earlier you do, the more interest you will be able to get (compound interest effect). However do think carefully as you might need to use your OA for other stuff.

Thanks for reading!

Saturday, December 16, 2017

My Journey Of Purchasing My First Property [Part 1]

Hi Everyone!

Starting from this post, I will share with you on my experience on purchasing my first property which is a 2 bedroom condo at the north area.

For this part, I will share with you on the preparation work before eyeing on the first property and also the must know stuff before you purchase a property.

1) Are you purchasing for your own stay or for investing. Many may asked why is this question so important, afterall it's still the same. Well yea, after all the property that you purchase, you can either stay or rent it out. But, when it comes to financial terms, you might be doing it wrong.

Why do I say that? Because we need to know that the property that you stay in might not be an asset (which I think it's true). The reason is because the property that you stay in, is most likely a liability because you will need to pay for the possible expenses as well as you will need a place to stay so you can't really sell that property unless you downgrade. In other words, do think of it as paying for your rent to stay.

So, why is there a difference in deciding whether to stay or rent? Not sure if you thought of it this way but personally i will have different criteria for purchasing property for own stay and investing. For me buying for own stay, I will look out for bigger space, psf not so expensive and then considering location and amenities. If I am looking for investing, I will go for location first before the size of the property.

The reason why I think this way is because having a bigger space is crucial for me and my Wife is because we will be expecting to have children in few years time thus we would need bigger space so that it won't be so cramp. So bigger space is very important to me if I am living in it. On the other hand, for investing, location, location and location. Without that you might/will not be able to get a good rental yield.

To sum up for Point one, my criteria for purchasing my property is size, mid to Low price and monthly installment is affordable.

2) New property or resale?

Of course new property will definitely be better as everything is brand new and not much renovation is required, new is good for me:) so we start our property hunting 2 years back( from 2015 till 2017). Initially we wanted to check the property market and what are the layout of the condos (including the various design amenities and etc) to understand the condo facilities and the cost as well.

Due to the lack of fundings we were not able to purchase any property back then even when highpark residence was launch at the very affordable price (so no choice have to skip that)

Up till this year where I have hit my target of 160k and more, which enable me to start looking for property with the intent to purchase. Back in 2016, my Wife and I already looking out for condo at Bukit Batok (le quest) which initially we thought that it will be affordable after all not much amenities around that area and it's not near mrt. Which makes us thought that the psf will be lower like around 1k psf. But we turn out to be wrong because the indicative price for 2 bedroom is around $1158 and when the actual sales it went up to $1200++. So which means a 2 bedroom with the size of 598sf would cost around $800k++.

The size is small and psf is high which isn't what we looking for. Of course we still went through the balloting process and we didn't purchase it. We were devastated during that moment but we didn't give up, instead of looking at the new property, we change our direction to look for resale property, those that Just completed 2, 3 years ago.

We spotted quite a number of units in the north east area like Punggol, Sengkang and etc. But the location is too far from our workplace. So although the price is attractive but the Travelling time really not worth it unless we change job. So our search continues until we found the one with 850 sf with the psf below 1k and is quite near to our workplace. The price is around the same as le quest 2 bedroom but the size is bigger, bigger by 252sf. To me it's totally worth it.

So this is my part one of my sharing, do look out for part two as I will share with you regarding the finances of purchasing a property.

Thank you :)