AutoWealth Performance – March 2021

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Here we go for March 2021 performance for another Robo Advisor. Different robo advisor really does things differently. They concept, the drive and the unique selling point are all different. Some just have more marketing power than others while some just like to lay low. It is a little like a new acquaintance to a friend and eventually to a close friend. Wondering if you made the right choice? I guess only time will tell.

Why Autowealth?

Every month, I’ll just to just remind myself why was I a friend of Autowealth. My two reasons for doing so is really just (a) try out one more robo advisor/segregate a portfolio to find out how they invest and what their model is and (b) Diversify my investment assets through different companies.

Against all odds, the costs of robo have set a bar in the local scene that they are one of the lowest cost solutions to build a portfolio. These options used to be only available to people who have access to unique solutions like private banks or high networth individuals. Then again, the manager takes a big cut from their investments by taking risks.

As Usual, overall market goes through peaks and troughs. Every time it drops, just pick some up and let the robots do the work on balancing and re-balancing. As long as fees remains low, the portfolio will grow over time and over a longer period. It should remain in the black based on some back testing. I like it that they have already breakeven into their third year so something is working right for them.

So far, no change in asset allocation. I think I have been rebalanced two times now. It’s a little like locking in gains due to the rising market.

 

Performance – Mar 2021

Looking at the portfolio, the last few months have been stagnant and I still feel that it will continue to do so through 2021. My investment horizon would be estimated to be 15-20 years. This is a portfolio which is set at roughly 40% equities and 60% bonds. The investment vehicles will be through ETFs. It does look like it can withstand long term peaks and troughs. What i really like is that i can switch between the SGD and USD currency performance portfolio as well as the impact on USD SGD forex on performance. USD has been steadily increasing versus the SGD.

 

Overall, since funding to date (in SGD currency) performance is +10.66% and I like this. (compared to Feb 2021, it is up +1.2%) The impact of USD on SGD is about -2.69% and by referencing the portfolio in USD, absolute return would be at +13.14%. No complaints thus far.

 

Looking into the details if I were to look at the portfolio value at $5334 (end Dec 2020) versus today at $5533. Some simple and manual YTD calculations below

YTD Performance[($5533-$5334)/$5334] x 100% = +3.73% (YTD 8 Apr 2021 and +1.4% as compared to 10 Mar 2021)

Disclaimer

This is not a sponsored post. This is purely my own opinion after using their service and/or products. If you like what you are seeing, do remember to check they out and do your diligence. There is no one size fits all investment strategy.

If you like what I am sharing or if it resonates with you, do use my referral codes here at https://lifejourney.blog/contact/ for the services.

The pictures were taken from Auto Wealth website for this article. If you need a referral code, drop me a message and you can indicate my full name during registration. From there, both of us will  get $20 each to supplement the fees.

Endowus Performance March 2021 & YTD + New ESG Portfolio

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Time in March 2021 seem to just go by in a quick frenzy. Stock markets have retraced and between Tech and Cyclical equities, it seems to sway from side to side. There isn’t seem to be any clear signs for any particular trend. The slightest event such as the cargo tanker remained jammed up in the Suez Canal seem to have caught commodities in a stir for a week or two.

I’ve been talking about Endowus for a while now. I think there is something that attracts me to them. Perhaps it is the way they present themselves or maybe it is their mindset of investing that struck a chord with me. I would actually recommend them to anyone I know to be honest and I know that my investments will be safe with them. Further, they raised their first ever Serie A fund raising for expansion. It does sounds like a great step forward. Whatever was private, we don’t know but their first fund raising after being around for sometime does spark some confidence about how prudent they are and how much the founders value their own equity in the company. To me that is a plus when the founders want to keep stock value mainly because they see value in their own company.

ESG Portfolio (New)

I am quite intrigued in their new ESG portfolio that was constructed through the different fund houses. To a certain extent, I do want to put more into it but I am unsure since I’ve not read up on this but I do know that ESG have performed relatively well in the European zone. This segment would serve me well for a long term portfolio because I do see the value in investing in sustainable companies an practices. After all, we are saving this earth for our next generation – a little step goes a long way.

This is at +1.97% since inception some time in Mid March 2021. I like what I am seeing. Of course this is a 80%/20% Equity/Bond portfolio allocation so there will be more movement on the equity side. This is long term so, just leave it in there.

SRS Portfolio

Overall, portfolio is up 18.51% since May 2020 in SGD. As usual, in USD terms, due to no FX impact as the portfolio is USD ETFs, the performance will definitely be better especially when USD becomes stronger. Of course, the reference will be SGD since I use SGD. This is the SRS/Cash portfolio which consists of my favourite Dimension Funds in a 40% bonds/60% equity. Overall from May 2020 to 5 Apr 2021, it is a 18.51% increase in absolute terms – Fantastic. From Jan 2021 to 5 Apr 2021, the fund was stable and rising more  at 4.86%+ increase in portfolio. Not too bad really.

In Terms of YTD returns in 2021, I’m looking at 4.86%. I’m happy. Definitely topping up if there are any corrections (By definition a correction is more than 10% drop in a single day)

CPF Portfolio

For the CPF portfolio, it is also doing pretty well though not as well as my Dimension Fund portfolio. I’m still looking at 12.23% returns from May 2020 through to 5 Apr 2021.

In Terms of YTD returns in 2021, I’m looking at 1.68%. This is quite expected so not much of a surprise. I have no requirement to login daily to view my portfolio performance. Just a monthly review will be sufficient.

Similar to the previous months, cash management accounts have started to report a decline. This is also expected since LOW interest rate environment is here to stay for the long term.

I have been procrastinating about the Cash Smart Portfolio. Perhaps I will take a plunge to do it in April 2021. Takes a bit of courage to do that.

Like a broken recorder, the pros once more:

  • Endowus is the first and only robo-advisor to be approved by the CPF board.
  • 100% trailer fees back to the consumer, not the fund management fee. This is really one of a kind I’ve seen so far.
  • They do have a decent team who makes sense when introducing their platform in my personal opinion.
  • I believe all retail investor should try them out because of how they are trying to disrupt investing and make investing work for everyone.

Thank you all in advance for using my referral code.

Last point is to do your own diligence. What works for me may not work for you. Investing in traditional portfolios is about risk management, it isn’t Cryptocurrency. Super high risk = Potentially Super high returns. Fair enough in economic terms. Just remember that = Potentially Super high decrease in portfolio as well.

I’m not ruling cryptocurrency as an asset class here. What I do see is that they will be a disrupter in traditional currency in the future. What I am saying is traditional investments brings stable, slow and disciplined returns. I do have a portion of my funds in cryptocurrency and the latest trend of NFTs (Non-Fungible Tokens). I deal with these two investments separately and realistically.

Disclaimer

If you decide to sign up with Endowus, do remember to use my referral code: https://endowus.com/invite?code=EDZ8M

If you like what I am sharing or if it resonates with you, do use my referral codes for other services at https://lifejourney.blog/contact/

These pictures were taken off Endowus website for reference.

ESG & more on Endowus & Why Endowus

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There’s a lot of hype around Robo-Advisors these days. I still go by the same rules, if nothing is broken, there isn’t a need to fix anything. Robos are here to stay for sure and they have been rather un-emotional when it comes to investing (That is a good thing by the way if you are thinking otherwise)

Trust

Trust – It is the pinnacle of consideration when you invest or put money with a certain institution. Endowus has been – I would use the word trustworthy to describe them. A lot of these have been shown in how they conduct their business. Firstly, I have a finance background and for the longest time, I’ve worked in Finance. To be honest, there wasn’t a single day I felt happy until I truly left the industry. Finance is all about numbers and money. People are motivated by the fact that they make the quickest buck from the fastest source. However, what I am seeing here is quite the opposite. They are pretty truthful and walk the talk through their actions.

The points in Summary

  • The introduction of institutional class funds. If you are not in the know, you will not know. The more funds/money you have, the more you will be in the know hence you save more on fees.
  • The exclusivity in certain funds that only that few can launch with other fund providers. Sometimes, it’s about the expertise that is focused on the fund type
  • The fund rebate. No need to explain more about it. Fund fees and rebates are very transparent and apparent in how they rebate it back.
  • Quarterly fund charges are charged only end of the quarter. I’ve never seen that before or not many does it. Most funds and banks does the front loading. The worst type of funds are ILP – They embed the bid-ask to 5% (That’s just rip off and I say that those who offer these may not even know about it)
  • First and only digital advisor to be able to use your CPF to invest. Speaks a a lot about the trust of the board to allow them to do so.

New Point to Note (& ESG)

  • Recently, they launched an ESG fund portfolio that is made up from several well known fund houses specific to the ESG criteria. It is important to invest responsibly and sustainably. ESG has been around for the longest time. In Asia, we hardly ever hear it until only recent years and by quickly moving on this front – They are really one of the fastest to bring this up to scratch. No doubt, this is one to invest for the generations to come.
  • To secure your funds, all your investments are not held in custody. You own your own account in UOB Kay Hian but the investment is managed by Endowus. This is to safeguard your own money should they decide to close down one day (which I don’t think they will in the near term)

Finally, i recently received an email from them. For the longest time, they have the bar set at an initial S$10k investment. This has been slowly reduced and to date. For every friend who invests with Endowus, you both get $20 in Access Fee credits, equivalent to $10,000 advised free for 6 months. There is no limit to the number of friends you can invite.

There is anything much to add on and nothing to complain about other than your investment and redemption takes times to complete.

Disclaimer

If you decide to sign up with Endowus, do remember to use my referral code: https://endowus.com/invite?code=EDZ8M

If you like what I am sharing or if it resonates with you, do use my referral codes for other services at https://lifejourney.blog/contact/

These pictures were taken off Endowus website for reference.

Best time to Invest Now?

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More often than not, I read articles and comments and many people ask about if it is the time to invest now. Markets are too high…What asset class to invest into and should I invest now? I only have $100, $500, $1000 (It doesn’t matter how much you have. It matters to start early and depending on which stage you are at. It might be better for you to start an emergency fund first before you invest)

Just this morning, I was listening to Kiss 92 radio channel and I heard that there was a miracle. A fan fell down and went into coma for 23 days. While he was a in a coma, the morning show DJs started to call and talk to him. While they wished  for a miracle, they kept it real and thought that it might not happen. This then sparked a little thought – something we all know but fail to execute.

The story is such a good one that it kind of send me teary eyed for a short while. While we know that miracles do happen, we also know that miracles don’t happen all the time. However, it is important to keep believing that thing will happen the way you want it to no matter how far it seems. Never say never. Be practical but sometimes there are no explanations.

When is it really time?

You will never know when is the time you may lose your loved ones so treat them well and shower the love. Similar to investing, we will never have the crystal ball that tells us the future. If you do have one, I think there isn’t a need to seek financial independence anymore. No matter how accurate, lucky or correct one can analyse – there are no shortcuts. All things take time.

Spend time not focus purely just on money

Spending time on your loved ones is more important than making money. Money as what I alway advocate accelerate the process to many other things. Spending that time not also allows one to connect socially with family as well as reconnect with the young and old. Crossing generations also gives you fresh perspectives and new ideas. Don’t write them off.

Investing takes up a lot of brain cells if you are always exploring for new ideas. These perceptions will provide options and aide in that journey.

Family is family

Whatever your situation is family is always family. What you represent eventually will be translated down to the next generation. There isn’t a guide or way to do it but everyone is a parent for the first time so cut some slack on yours. After all, they were in different times as we did today. Family time provides connectivity that helps one mentally while providing that support. Some may call it safety nets in the finance world but personally I prefer to call that emotional support group. Perhaps friends might be as close to family but everyone’s comfort level is different.

With a section of the mental support covered, naturally one’s focus will be freed of distraction. However, there should always be a balance.

Is it the best time to invest now?

It is hard to say all of that with so many conflicting articles that talk about an all time high and that an impending correction is coming soon. That is all technical and feel. There are no scientific rules as to why markets goes higher or lower. Only interest rates and bond prices are inversely proportional. Other than that, there are no fixed formulas and no one can single handedly control or manipulate the markets.

As always, you can choose to put in some during the initial phase and stagger the investment on a regular basis. This is what most people know as dollar cost averaging.

The other way is really to split the amount that you wish to invest into 3 or 5 parts. Every time the market drops, just diligently put some in.

What ifs?

What if the markets were to increase by another 5% or 10% and you are not invested. That would mean that you will always be missing the market rallies. A medium and long term view of the market will definitely help in the long run.

The excuse

The contradiction will always be there. When you are young, your commitments are lesser but the disposable income is lesser too. Moving into middle age, your commitments increase but your disposable income depends on what you need to spend on. When you are slightly older, your commitments decrease but your risk level should not be like 20 years ago.

The concept

The whole idea is to really to invest early and invest regularly. A miracle happened for someone today but that doesn’t mean it happens to everyone. Some people missed their chance or opportunity and that would have been too late.

Disclaimer

This is purely my own opinion after using their service and/or products. If you like what you are seeing, do remember to check they out and do your diligence. There is no one size fits all investment strategy.

If you like what I am sharing or if it resonates with you, do use my referral codes here at https://lifejourney.blog/contact/ for the services.

The pictures were taken from website solely for the purpose of illustration. Remember not to be a slave of money but make as much as you can so that you can make use of money.

Autowealth Robo Advisors – Performance (Oct 2020)

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So, it goes on and on for robo advisors. Many would probably be tired of hearing this. I mean, this is pretty normal. Unsexy stuff is not always exciting than the buzz of trading. Just only a couple of years back where i left the financial industry, I seem to be able to take a step back and think about what is an investing portfolio.

From where I came from, building a long term portfolio is very rare. The emotions, drive, passion and revenue counts a lot. Customers want quick and fast trade execution with low rates and high profits, sometimes it comes with terms like low duration and low risks. Let’s face it, people are a greedy bunch – most people just want guaranteed returns, beat the system, make huge profits and take low risks. I rather people show me how to make those returns guaranteed and i’ll put money with them instead.

I get it that property, gold and some asset classes do generate huge returns over the past few decades. That is history and history doesn’t mean it will return the same going forward. All these talk, there can only be a process when there is a conversation around planning, finance or even trading. Most people are just classified under the one way channel.

Investing especially in spot market is a tough business. Most people cannot accept fluctuations in their portfolio. Autowealth is yet another solution for me. Just that this time around, this is for my kid to start out her investment journey when she can. Teaching financial literacy is something I would recommend to anyone.

Why Autowealth?

My two reasons for doing so is really just (a) try out one more robo advisor and (b) segregate this fund for any other purpose other than the kid’s investment journey. We shall talk about if robos die off in the future but this is conversation for another day.

My take about the investing journey has been the same since day one. Don’t sweat the small things, the costs of robo are so low. We are talking about a 15-20 year horizon here so heck those low costs. You need to pay them to keep their lights running. For companies like Endowus and StashAway, these guys have the experience and passion and these translate into action.

Perhaps Auto Wealth is in a different segment all together but they are the ones I see positively after the other two. After signing up in June I finally got to funding the account in September and October when markets were on the downside. The idea of doing this over the long term is to really to buy in when markets drop. Down the naysayers, just take a look at this historical S&P 500 chart for the last 50 and 100 years. Markets will go up and each time it drops, just pick some up and let the robots do the work on balancing and re-balancing. As long as fees remains low, the portfolio will grow over time and over a longer period. It should remain in the black based on some backtesting.

For a 50 year horizon on S&P 500 (roughly around 1970 to 2020):

Big time hedge funds and billionaires made their market on the equity markets during US boom time. Naturally, capital market are still the source of capital funding even till today.

For a 100 year horizon on S&P 500 (roughly around 1920 to 2020):

From 1920, US markets isn’t that global and the equity markets isn’t that advanced so there is a long plateau. There are more factors than not being global as capital raising. It is not a popular medium since investors are less savvy as well.

Performance

Looking at the portfolio, it looks pretty nice ahead of the 15-20 years horizon. This is a portfolio which is set at roughly 40% equities and 60% bonds. The investment vehicles will be through ETFs. It does look like it can withstand long term peaks and troughs. What i really like is that i can switch between the SGD and USD currency performance portfolio as well as the impact on USD SGD forex on performance. I wouldn’t say this does as well as the portfolios but to be fair, markets were already slightly upwards and I would like to deploy funds out into the market in tranches over time.

+3% absolute is decent in my view and this is as at 16 Nov. If markets drop, the rule is to fund the account more. Do note that all of these will have USD exposure. Time versus DIY – it is really about what is important. I usually will want to see the ultimate end goal whenever I start anything.

Disclaimer

This is not a sponsored post. This is purely my own opinion after using their service and/or products. If you like what you are seeing, do remember to check they out and do your diligence. There is no one size fits all investment strategy.

If you like what I am sharing or if it resonates with you, do use my referral codes here at https://lifejourney.blog/contact/ for the services.

The pictures were taken from Auto Wealth website for this article. If you need a referral code, drop me a message and you can indicate my full name during registration. From there, both of us will  get $20 each to supplement the fees.

 

Stash Away (Sep & Oct 2020)

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I’ve not been diligent in posting my performance that i invest into Stash Away. It has been positive so far (the experience) and I’ll say it is on par with what Endowus is providing. In my own words, I’ll say that they complement each other and offer different perspective. I do trust and believe their views on certain aspects of investing and hence, SA shall be the second robo advisor that I will build a long term goal with over time.

I have since adjusted the risk index to below 20% as I felt that there isn’t a need to go all out Risk On. Having calculated risk per $ makes more sense in my opinion as news and information goes on a random rampage. Most importantly, I am invested – So if Mr Market decides to go up that is fine too. If Mr Market decides to go down, then it will be time to put more funds in. After all, it is a long game.

Retirement Portfolio A (risk-14%)

The SRS account since deposit is currently at +2.46% as on 5 Nov 2020. It’s one of those that I went in February 2020 before the crash came in March 2020. Nonetheless, I believe in the long term strategy that S&P 500 or index generally rises over the longer term so I have a super long horizon on this. I haven’t decide if I should fund more SRS monies into SA or Endowus. We shall see how things turn out.

Education Portfolio B (risk-16%)

This is something I set on a 15-18 year horizon. It is at +5.06% as at 5 Nov 2020 and I think that is a good return in my view. I have been averaging in whenever there are market dips. The risk index is at 16% and I will adjust from time to time as I do believer that by doing so, you sell some assets while buying into a new asset class based on the risk you set so in a certain sense, I can take profit while increasing or reducing my risk. Try not to touch any of those if you don’t quite understand how that works. There is some level of punting involved.

Education Portfolio C (risk-20%)

This portfolio has a shorter horizon of 12-15 years so I feel that I need to take on some risk to achieve my goals. This SA risk index is currently at 20% and will take on to be one of my riskiest portfolio. More funds will be added over time to achieve my targeted invested goals.

Conclusion

So far StashAway has not failed me in a sense that it fits in to my investing style and logic. I wish to put more into the accounts but I cant bring myself to invest when prices are going higher and higher. Instead, when things come down I find it easier to put money in.

To sign up or try out Stash Away, visit the website and use my referral code at Stash Away Referral

We’ll both get up to $10,000 SGD managed for free for 6 months which is a good deal.

Disclaimer

If you like what I am sharing or if it resonates with you, do use my referral codes for other services at https://lifejourney.blog/contact/

The pictures were taken from the Stash Away website for this article.

What Will I Invest with S$10,000

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I realised that such posts actually attract more viewership as compared to technical breakdowns. I get it that most people want a quick and fast way to read content and download views. The first 3 seconds of every post will most likely decide if the reader would like to continue reading, be skeptical or just scoff at it. In my earlier posts, I talked about having an emergency fund. It takes time to build such things so don’t forget, the little things count.

In this article, I’m going to discuss more about what to invest and why especially for folks who just got out of school. When I graduated, I remember vividly that it seemed to be pretty hard to save money. A few years on, I realised what constituted the bulk of my spending and why I could not save more. These life experiences cannot be bought so I would say the money spend networking and forging friendships are my human capital.

Going back in Time

Going back to 5 years ago, there wasn’t many choices to invest extra funds into. It was the standard brokerages, fund houses or at most bank/custodian brokerages. There wasn’t a lot of tools to invest in and let’s be honest, the retail bankers can’t be too bothered with a S$10,000 fund. It just isn’t worth their time. So, like many others who preaches, I shall say it again – If you do not care about your own money, no one will. I remember I used to buy funds via FundSupermart, trading some Forex with CMC Markets/Saxo Capital and used Standard Chartered Brokerages to buy US/SGD equities. Nothing fancy that you can really do though.

Moving forward 2020

With the current options we have available, traditional investments seems really cool. (At least it is for me) I really like the options out there for me to pick and choose. You can Insurance Tech, Robo Advisors, Cryptocurrency, Real Estate Block-chains, ETFs, Leveraged Equities/Indexes and many more. With the upcoming digital bank in Singapore, I think that this is going to be great for consumers. The key problem now is to get more people interested in their own personal finances.

What to do with S$10k?

We are going to take away the cash solutions for this since this is on the assumption that cash funds are kept away in a safe place. With the new funds, this is money that you can afford to lose. I used to know something who likes to take a punt, he would leverage and buy options on the same counter without considering the risk. Well, he wanted to win big but eventually his portfolio became pathetic and he lost his job while these options expired and markets dropped. The objective of sharing this story is to always abide by your investment discipline.

I am reminded of the rules:

  • No one has the crystal ball and you will never know when the markets decide to be green or red.
  • A small amount of leverage is fine but not when it is concentrated into one counter. Remember to diversify but not over diversify.
  • Always use option to your advantage, not to speculate.
  • When you lose to the market, blame no one but yourself because no one forced you to invest. You can keep cash and seek cash solutions but if your cash deflate, that’s on you and no one else.

With a S$10k portfolio, I would split it up into a few tranches.

Robo Advisors

  1. Robo Advisors are a great tool if you do not know what to buy or when to buy. The whole idea is to buy when markets go up or down. The entry level for robo investing is so low that anyone can invest. Let’s also be real, all platforms have a cost upkeep so fees are unavoidable. For this I would Assign at least S$6k (~60% – 70%) into such funds and this forms the Core part of the long term portfolio
    1. The first option can be Endowus (USD ETFs) which i discussed before here at Endowus
    2. The second option can be Stash Away (USD ETFs) which i discussed before here at Stash Away
    3. The third option can be Syfe (For SGD related equities or the Global Equity Portfolio) which i discussed before here at Syfe

Now, you must not forget to top up your investment on a monthly basis. Treat that as a form of savings. The earlier you save, the faster your will reach your retirement goals.

From the robo advisor portfolio construction, you can choose a partial bond|equity balanced fund. This is where your bond exposure comes in. Do not waste your time with SGS or SSB during this period because they returns are not great.

Cryptocurrency

2. They say that trend is your friend. The trend now with all the hype is about Cryptocurrency. I can’t help but would add a small amount to the portfolio. They are supposed to act different as compared to fiat currencies. For this I would assign at least S$1k (~10%-15%) and i consider these as alternative asset class.

    1. The first option is to buy Bitcoins. They are by far the largest Cap in the Crypto World.
    2. The second option is to get a foot in to Crypto.com. I previously discussed about this as well here at Crypto.com App/

Funds

3. Personally, I like income or dividend equities or funds. If you are more risk adverse i would suggest to put some money into the PIMCO income funds. They are just the best in class for bonds. Depending on what you like, the average dividends is roughly around 3-4% p.a. For this, I would assign at least S$2.5k (~25%-35%) and these are supposed to be a stable source of dividend funds.

Trading

4. Finally, what fun is there if you leave everything in the Core Portfolio. The balance 15% of funds (~S$1.5k) can be use to buy in specific equity counters in the SGX. (for e.g. bank stocks or reits whenever there is a market pullback) If you really wish to fully invest these monies, just put them back into the Robos or ETFs.

What other options would you do or suggest to do? Feel free to comment. The whole idea of writing is to really share about opinions and you never know when an idea strikes you.

Disclaimer

This is not a sponsored post. This is purely my own opinion after using their service and/or products. If you like what you are seeing, do remember to check they out and do your diligence. There is no one size fits all investment strategy.

If you like what I am sharing or if it resonates with you, do use my referral codes here at https://lifejourney.blog/contact/ for the services.

Images seen in this article were take off the relevant websites for illustration purposes only.

Singapore Reits or not?

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Singapore Reits is something that many Singaporeans understand and take heart to. Some folks actually build their income/passive income via this source and I can see why.

My take on Reits on SGX

a. First it is based in Singapore – There is this local bias that it can do well given most people like to see for themselves if the malls are working out well in terms of retail quality, crowd, spending and how many shops are still in business.

b. SGD payouts avoids the currency risks. For a retiree or someone drawing on income from dividends, this payouts serve as a source of bill payment.

c. An alternative and cheaper way to enter the real estate market in Singapore is really through the reits/stock exchange. I know that people will argue that it is different but technically in my view, it is the same (And you do not need to pay stamp duties, get a mortgage and pay sales charges)

d. It is more liquid than real estate.

For a long time now, Reits have been growing big and popular within the investing community. Again, all investments comes with risks – Most people have more comfort in dealing with things they can see or get a sense of. For a long time, there have been plenty of wins for reits but as you can also see, the Circuit Breaker period in April through May have affected them in a way or another.

Diversification?

So again diversification is key to investing once more. If you put all your eggs into the Reits for passive income, then with such dividend cuts your bottom line is definitely affected. Currently, it doesn’t seem like this Covid situation is going back down or slow down whatsoever so dividend cuts is going to be prolonged in order to save businesses and jobs. Then again, there are certain sectors who might see a booming business such as Data Centres or even certain suburban reits. Sub-urban malls are definitely crowded but the former shopping aisles in orchard and high end malls are definitely missing the tourist crowd which rakes in the cash and spending. It is no wonder why people are worried about their livelihoods.

It is not all doom and gloom. Sectors will emerge while some will recover. It is definitely time to pick up some if you did not have any. The idea is to really have a long-term goals when you pick a stock and stay disciplined. Once you sell it off, you may never be able to pick back the company at their valuations again.

The Passive or Lazy Choice

If you are lazy, let Robo-advisors do the trick for you. For e.g. Syfe. https://www.syfe.com/ Initially i only took on the Reit+ portfolio some time in April 2020 to test it out so that I do not need to manage the portfolio and incur those trading fees. They have expanded other products such as a Global ARI portfolio (Long term investment into equity,bonds and commodities) and Equity100 portfolio which is 100% into global Equity ETF (US and UK listed ETFs)

Auto-rebalancing

Syfe has invented their ARI (Automated Risk Investing) methodology, which is a risk-based rebalancing strategy, which changes the allocations of your portfolio according to changes in risks in the market in order to limit your losses. In short, once it triggers a certain level, the system will trigger an alert and things start to sell off to re-allocate. It also means that over the longer term, you will naturally see a better performance of the portfolio.

Every rebalancing of course depends on what portfolio you choose from so everyone is different. I personally like the idea of investing into a portfolio of reits instead of picking it on my own. In terms of fees, it depends on your investment amount with them.

In terms of pricing, I think it is cost effective. Do find out more about it here https://www.syfe.com/pricing

a. Management fee per year is at 0.65% p.a. for investment amounts S$0 – S$20k.

b. Management fee per year is at 0.50% p.a. for investment amounts S$20k – S$100k.

c. Management fee per year is at 0.40% p.a. for investment amounts S$100k and above.

Do use my referral code to get some benefits when you sign up a new account with Syfe. Referral Code: SRPTSMQ5J

You will get (Find our more about their referral scheme here https://www.syfe.com/magazine/how-can-i-invite-a-friend-to-join-syfe/) :

a. S$10 bonus if you invest S$500

b. S$50 bonus if you invest S$10,000

c. S$100 bonus if you invest S$20,000

Disclaimer

This is not a sponsored post. This is purely my own opinion after using their service and/or products. If you like what you are seeing, do remember to check they out and do your diligence. There is no one size fits all investment strategy. 

If you like what I am sharing or if it resonates with you, do use my referral codes here at https://lifejourney.blog/contact/ for the services.

The pictures were taken from Syfe website for this article.

Term or Participating Life Plans?

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Term Insurance or Participating Whole Life Insurance? This is the question that I often ask and discuss with my other half. Typically, people seek value when they buy or invest in something. For insurance, value seekers would prefer a cash value. Cash value is what you have contributed over the insurance tenor. These sum of money, deducting the cost of insurance, the fees, commissions, salary and what nots will be invested by the insurance company Fund Managers (Whether they choose in-house or external fund houses) – In short they are known as participating life insurance.

Term and Whole Life Insurance

Term Insurance are policies that do not have a cash value. They are typically cheaper than Whole Life Plans (Otherwise it wouldn’t make sense to get term insurance). For example, they cost $200 per annum for a coverage of $200K and it depends on your age at point of inception. They may or may not be renewable yearly, meaning that the premiums will increase with age and each individual health condition.

In my personal opinion, I think that a Whole Life Plan is really expensive. You pay premiums and the first three years, there is literally no value to your assets. Then your participating underlying investments are handled by someone else who tries their best to beat benchmark and regardless, they get paid in fees and costs.

Buy Term, Invest the Rest?

There is a famous saying, buy term and invest the rest. Well, I don’t have a view on that. It really depends if you want to leave some legacy behind for your family/kids/relatives or it may even be transitory. For e.g. used to cover debts such as a new house, a new car or assets. In order not to complicate matters, I’ll leave illness out of the equation and discuss solely on the death benefit. Generally, you need to cover your liabilities so that in the event of death, your family members not only are rid of their stress and pressure from the loss of a loved one as well as the financial aspect of it. To a certain extent, I believe in covering at least 2x of your liabilities so that there is comfort in dealing with more financial freedom.

The other stuffs to take note of

For a typical household, i believe that health insurance is the first thing you need to seek coverage on, followed by life plans but everyone’s scenario is different. In finance, there is a phase that all of us has to go through which is also the toughest and it is called wealth building. I’ll leave it for discussion on a separate day but my point is, you buy insurance based on what you can afford and not because it is cheap or time is not on your side.

For me, I take the approach of covering term as well as whole life plans. The hybrid style works for me as I am pretty savvy with financial contracts and insurance. In my own time, I am qualified advisor for insurance and more qualified than many out there but I never once worked for any insurance company. Though finance is my forte but there are too many products and innovation in this field that you cant keep up. So, you need to have someone in there to guide you along. It is annoying to talk to agents so you need to have someone you trust.

Let me just plant some ideas – If it make sense. It isn’t all encompassing but just to point things out.

Term Life:

A. A Substitute for liabilities (Housing loan, car loan, personal loan, student loan)

B. A transition phase which you do not mind protecting until that period is over. As term has no value, it is similar to a no-contract telco plan and you can get rid of it anytime (if the time period is short)

C. Supplement for a shortage of coverage that you have for your whole life.

Whole Life Plan:

A. It’s just for lazy people. Buy/Save and pay the premium for a period of time. Leave it there.

B. Buy at a young age and the premiums stay really really low which is smart. Consider your finances too as you need it to be as affordable until you have served the payment term.

C. If you have a young kid or elderly who are not working. You, are the income holder needs to be insured. When you are gone, the young kid and elderly will not be able to work to give you an income.

Above all, health is of the utmost importance. You will never know when or what hits you. Even then, your state of mind will be in a mess. So, no matter how prepared you are, no one will ever be prepared. All these little steps and conversations must eventually turn into real action. When shit comes, it comes and there is no point saying “I should have”. Don’t just listen to your agent out there. Seek alternative, ask and learn. No will will care more about your money more than you will – These life skills will bring value to your own life and frankly I can’t see a life with no planning and no one should.

Disclaimer

These are just solely opinions of mine. Different people have different needs, requirement, financial situation and views. For me, this is what I would do if I need to deal with buying insurance for myself and my family. There is no one size fits all – different strokes for different folks.

If you like what I am sharing or if it resonates with you, do use my referral codes here at https://lifejourney.blog/contact/ for the services.

The pictures were taken from the website for this article.

New Changes to MoneyOwl Fees

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MoneyOwl is an initative from NTUC Social Enterprise. They are sort of a Robo-advisor coupled with a suite of wealth planning tools such as will writing and insurance solutions. What really attracted me is their rather simple way of investing and using Dimension Funds as part of their portfolio construction.

As a retail investor, you will most likely not be able to access such funds. When the market tanked sometime in Feb 2020, I picked a few Robo-advisor to invest into and look into performance a few months later. Almost six months has passed now and I will most likely show some of the performance in my later posts but I must say, by doing nothing much, all advisors reported positive returns as compared to my own stock picking.

Changes to MoneyOwl

Recently, MoneyOwl announced that they have lowered their investment advisory fees as well as absorbing the platform fees.

a. For Asset under management S$10,000 and below, there will not be any fees through 31 December 2021. This fee will be rebated back to the portfolio. So take note that only Cash investments are eligible for this rebate. The cash management accounts do not have these in place and your total portfolio value has to be above S$50.

b. There is an introduction fee of S$99 which is worth about S$535 for a comprehensive Financial Planning. Money Owl’s advisors will sit down with you to review your portfolio with detailed report and recommended next course of action. (~2 hours)

c. Additionally, they are introducing free financial resilience workshops to focus on cash flow management and debt management. Likely through Webinars and anyone can join in.

It is nice to see that as a partner to our national social enterprise, they are making moves to help Singaporeans. The reduced fees on investments which is one of the key points in long term investments. The more fees you pay, the more it affects your own portfolio performance.

However, they should really look into improving the interface. (for e.g. making it into an app) They also introduced a referral fee scheme or some promotional fee scheme for new sign ups. Not much complains other than that.

Follow us visit my blog if you like what you read at https://lifejourney.blog

Disclaimer

This is not a sponsored post. This is purely my own opinion after using their service and/or products. If you like what you are seeing, do remember to check they out and do your diligence. There is no one size fits all investment strategy. 

If you like what I am sharing or if it resonates with you, do use my referral codes for other services at https://lifejourney.blog/contact/

The pictures were taken from Money Owl’s website for this article.