Tips on how to be Money Sensible
I take charge of my own finance by several ways.
Firstly, I started reading on financial books and websites. Books that I read include Dave Ramsey’s “The total money makeover”, Joe Dominguez and Vicky Robin’s “Your Money or Your Life”, Andrew Hallam’s “Millionaire teacher” and etc. I also read a lot of articles on investopedia when I am on MRT or waiting for others. These books are easy to understand for layman and they are good for beginners who doesnt know what and where to start. Even if one is lazy to read books, at least they can always search for the meaning of financial terms on the dictionary of investopedia, which will provide both definitions and examples to illustrate the term.
After that, I opened up an account at CDP and at a brokerage firm. I chose not to have a broker because I just wanted to buy shares and collect dividend, so I don’t need someone to help me actively trade the stocks. When I receive dividends, I will reinvest them to buy new stocks. My portfolio is very small now, but with time it will expand greater, especially with the dividends regularly reinvested.
Secondly, I keep track of my spendings. I created several savings goal on my online banking account. Every month when I receive paycheck, I will allocate almost half of my salary into various saving goals (down payment, emergency fund, insurance premium and etc). The rest of the money I can choose to either spend it or try to be thrifty to save more by end of the month, but no matter what i choose, I know I have regularly saved certain amount of my salary into something important for me. I also use an app called Hello expense to record all my spendings. It gives me awareness on where my money went, and the awareness made me lost interest in some of the things I used to buy but did not give me much fulfilment. For example, I have managed to eat at restaurant less often after I realized I have spent an disproportionate amount of money on it, while in fact I can get same fulfilment by eating a decent hawker meal.
Other than keep track of spending, it is also important to plan ahead. For example, I set up savings goal for my tax and insurance because it is easier to save a small amount each month than coming up with a large lump sum near the payment due date.
When one starts to brainstorm how to save money, it is natural to come up with creative and environment friendly solutions. For example, I reuse the yogurt tub to put my stationeries, and the plastic containers of dental floss to put small items that are easy to miss, such as ibanking token, earphones, rubber bands. I also keep the food packaging which contains ziploc design so that I can reuse them.
Thirdly, I seek out for rebate or rewards program on something that I commonly use. For example, the travelsmartreward program rewards cash for taking mrt during decongestion hour. I also have a Plus! card for my fairprice purchase, Watsons membercard which allows 20% discount on member’s day, and a credit card for flashpay and online purchase rebate. Telcom services also have their own rewards system that allows one to redeem bill discount or make donations. All these seemingly small help really allowed me to save more into my savings goal each month.
Lastly, I continue learning and stay healthy. I use my free time to learn guitar, French and I regularly use wikipedia to look up for things that I dont know. Learning is not nececssarily about memorizing boring stuff and reading boring manual books, it can include anything that interests you, be it cooking, wood sculpting, self-defence art, yoga or even just knowing what food are people eating at other parts of the world. It is important to continue learning after working because you never know whether any of the new skills or knowledge might allow you to start a side income or even to expand a new career. Also, I often see people regretting not learning enough when younger, but I have never see anyone regretted learning too much.
Staying healthy is very important as the medical expenses will only be higher in future. Eat well, sleep well and exercise regularly will greatly reduce risks of diseases like heart attack, diabetes. Staying healthy not only benefits me, but it will also benefit my parents who care about me, and I will less likely be a financial burden to my children in future if I start taking care of my body now and do my best to improve my health.
by Ying Wei Jong