Category: %%curBrbr

day2day burn rate. diff from cashflowPrjn and expenseTrak

cooked food inflation

Posted on by tiger40490

j4 this bpost.. cooked food inflation is the most visible of all inflations.

After I returned from Japan, I visited food courts a few times. Cooked foods like 杂菜饭 in those places are getting expensive. Perhaps 10 or 15 years ago, I used to buy the same cooked foods regularly.

For everyone who needs to buy cooked food every day, this is bad news. However, on the flip side, this visible inflation bring out something good — It suddenly mad me appreciate home cooking .. cleaner, better ingredients, more nutritious, often 更好味道. For the same quality, $10 to $20 would be the price in those low-cost outlets. Fancy restaurants would sell even higher, for pretty much the same food.

Why did the Japan trip matter? Because in Japan I reminded myself to avoid all Chinese food. As soon as I was back in Singapore, I wanted to try Chinese food again. I went to a few places and checked out many Chinese foods. Then I came to notice the widespread inflation in cooked food.

Just_Say_No to creep,peerPressure.. #PerTrain

Posted on by tiger40490

Saying NO is one of my G3 most important principles in ffree, burn rate mgmt, long-term fin-security.

median household income & middle-class living standard is one of the first blogpost to introduce this JustSayNo principle.

SG government probably follows the same principle many times, but I won’t digress.

— eg: branded college and SDXQ home
— eg: retirement burn rate .. cpfLife ERS pays out about $2200/M, considered adequate for a Singapore retiree. I think this is a reasonable, sensible assessment. What if many among your cohort are building bigger nest eggs to provide $5k/M of retirement income? Would you feel the pressure to match up? This pressure is comparable to the pressure to buy a SDXQ home [Orchard mansion]
— eg: In 2011 or 2012 I hosted Haitao.Fu in my Newport home. I bought 3 small dishes from a nearby Chinese restaurant. One of them (toufu?) we didn’t finish — I kept the clean leftovers for my next meal. I have recalled this experience many times. I feel the /splurge/ peer pressure in hindsight.

I may or may not be right to assume him as a relatively thrifty student. He didn’t show any negative reaction about our meal but now I assume he has moved to higher positions on WallSt… In hindsight, I feel he might have been shocked by my thrift, even though the meal was way more than basic-healthy!  I probably spent USD 40. In hindsight, I feel a more “decent” delivered meal would be 50% higher. Leftovers would be … discarded?

— eg: Personal Trainer (fitness)
At OneNorth office complex, I visited a fitness center that offers nothing but PT (personal training). Minimum membership is $1800/12 PT sessions. If you earn a decent salary nearby, then you would probably consider this package. Now, suppose most of your colleagues have signed up. They tell you various reasons. You accept some of those reasons, but ultimately unconvinced. Some may point at LKY’s attitude on casinoIR and remind me that “Time has changed”. I think I am not old-fashioned, and would consider to accept that package if the $cost/benefit ratio improves. At the current price level, the ratio can become acceptable if I perceive significant benefit in the package vs the alternatives.

  • alternative: You could try jogging on the street near office (unappealing to me). Re Wayne St…
  • alternative: You could do some simple workout in office, or at home. Re Wayne St.
  • alternative: You could join a regular gym somewhere farther out, for $100/M.

At the current ratio, I would say it’s really important to justSayNo. Even if I earn 20k/M, this salary is /unsustainable/ in X years so now I need to spend like ordinary locals and save. Their business model (designed for the super rich) is too costly for the nearby office professionals.

Yoga membership is comparable, but per-session price is about $15 (compared to $150/PT)

why $5k[2016]→ $4k/M[2020] #tax

Posted on by tiger40490

The basic limitation of longitudinal  burn rate analysis is the exclusions. A trendline requires a consistent rule on exclusions. In reality, during 5 years my exclusion rule would be different from the previous or next 5 years. If we don’t address this limitation, then trendline is meaningless and misleading.

I have been tracking family burn rate for a few years. In 2015-2016 it was above $5k/month, excluding transfers, mortgage or UChicago fees. If excluding IRAS then about $4~5k.

Note: IRAS was up to $700/M, averaged below $500/M, complicated by baby bonus rebates.
Note: transfers to grandma or wife are usually spent on household.

In 2020/21 the average is below $4k/M excluding transfers, IRAS, cigna prem. It’s useful to investigate the improvement, and hopefully strengthen it. Luckily, with financial numbers it’s easy to drill down to uncover the exact reasons. Here’s my high-level explanation.

  • ⭝MindChamps .. was $900/M.
  • ⭝flights + restaurants .. was once close to $1000/M, nowadays below $300/M. After covid19, this expense will increase.
  • ⭜insurance premium .. is  higher nowadays, perhaps by $400/M
  • ⭜piano costs ..

— In 2022, our burn rate is likely to inch up to $5k, hurting our Brbr.

In Feb 2022, I told wife about $9k/M but using different exclusion rules:

  • + I record about $4k/M as the headline burn rate
  • + $1800/M is transferred to wife and usually spent
  • + IRAS about $900/M
  • + mtg interest cost will be $500/M assuming 1.2% pa interest rate.
  • + mtg principal repayment about $2k/M

y parents buy expensive gears4kids’ new hobby

Posted on by tiger40490

I always laugh at the middle-class Singapore parents who buy high-end equipment whenever their kids start learning a new skill

  • musical instruments
  • art equipment
  • sports gears
  • multimedia gadgets

Now I ask myself

Q: what’s the priority of a middle-class parent? I guess answer is motivation, commitment. Some of these parents are not mindless — they are mindful of the psychological effect on the child.

Don’t forget a small percentage of the equipment has a resale value.

own`family car]SG: white elephant

Posted on by tiger40490

https://www.budgetdirect.com.sg/car-insurance/research/car-ownership-singapore

k_X_car_dependency

Q: Looking at the stats below, what’s the need/motivation for a car in the family of Kevin.A, kun.H, Jun.Z, yu.Lin, and all of my 92S27 classmates

Based on very limited observations (not “evidence”) I will stick out my neck and venture to offer my opinion that it’s possibly lifestyle creep. Many of my friends live in condos located far from public transport. I guess a lot of HDB dwellers and office workers are in familiar situation — owning a car mostly for leisure and convenience of the family with kids and grandparents. If (a big if) my opinion is valid, then

  • it helps explain their cash flow stress level.. brbr, Fuller wealth, early retirement
  • it helps explain their worry about the impact (not “likelihood”) of job loss .. high monthly burn rate. Re OC survey 2020. In contrast, Raymond can last years without a job.
  • it helps explain their housing preference .. they use their car to discount the commute tcost. Well, tcost is a hard cost and can’t be discounted!
  • Let’s remember the the other tcosts — stuck on road; maintenance; insurance; paperwork; recon on bills (remember BGC rental)
  • it helps explain their lack of time for exercise.. In contrast, non-drivers walk longer for commute, and some commuters stand or even do yoga in MRT.
  • it helps explain why SGD 200k spare cash pile is not easy or common for them.. they would use this “pile” to pay off car loan or upgrade to a better car

In (tentative) conclusion,

  1. I think I’m better than many of these car owners in terms of earn / save / invest.
  2. perhaps car ownership is really valuable to them. If no more than “marginally important”, then it’s a huge waste of resources — both $$ and time.

— stats .. As of 2021, Singapore has

  • 577k personal-private cars excluding taxi/private-hire cars
  • 68k private hire cars
  • 15k taxis
  • 142k motorbikes

As of 2018, 35% of Singapore households owned at least one car (presumably including private hire cars), down from 42% in 2013, presumably due to Grab etc.

— Convenience .. is a lubricant and important to my life as well. Convenience is very subjective, not rational .
Convenience comes at a $cost. Some people are willing to sacrifice brbr (like 2 to 1.5) for convenience, but I won’t.

— 150k / 10Y total cost of car ownership … I won’t spend too much time. There are many breakdown analysis online, usually including loan interest.

  1. https://dollarsandsense.sg/2018-edition-cost-owning-car-singapore-10-years/ uses a $94k model to derive –> SGD 157k over 10Y. A 2022 POEMS webinar also used this estimate.
  2. https://www.singsaver.com.sg/blog/car-maintenance-cost-in-singapore#final uses an $80k model to derive –> $12557/Y * 10Y + $19155 for Y1 = $145k over 10Y

##benefits@every$1spend@NTUC: demystified

Posted on by tiger40490

— Information as of 2023 .. $2925 annual spend should earn $117 in the form Linkpoints i.e. 4%. 4LP/$1 spend consist of

a) A 2% upfront of their purchases (up to a cap of S$6,000 annually) in Linkpoints at point of purchase.
.. part of the 2.5%

b) 2% Additional patronage rebates , which will be disbursed in Linkpoints for their spend in the following year (May~Jun) as approved at the Annual General meeting of FairPrice, not NtucUnion.
.. 9 May 2023 is the first time in NTUC history that APR is paid out via (12,000) LinkPoint. In contrast, on 18May 2022, I received my APR in cash not LinkPoint

— The full list of cashback for every $1spend@NTUC:

  • 2.5% linkpoint for every $1 spent, credited upfront
  • .. I was earning 2.5% immediately after each purchase, up to 10 Aug 2022
  • 0.83% linkpoint for every $1 spent, credited @1st of following month … (Apr 2023) verified on https://www.link.sg/profile/linkpoints
  • up to $0.08 for every $1 spent, iFF charged on MB ccard

— Fairprice rebate .. Available only to NTUC union members who hold 20 shares of Fairprice.

  • — For 2021 spends
  • $0.04 for every $1 spent, credited in May to bank account, capped at $240
  • the 2.5% was 0.5%
  • — From 2022 on wards
  • additional rebates for every $1 spent, issued in linkpoints the following year
  • Compared to 2021, there is better transparency on the eligible spends because they earn 2% upfront (part of the 2.5%) … more doses of delight

A lot of webpages have outdated info including NTUC union roadshows.

(hidden)factors]household saving rate as reported

Posted on by tiger40490

https://www.dbs.com.sg/personal/nav/are-you-saving-enough.page?pid=sg-dbs-pweb-nav-featured-cardtile-others-are-you-saving-enough claims that the average Singaporean household in the survey saved 55% of the total income including employer CPF contribution + nonwork income reported on tax forms. This figure is highly questionable.

— Issue: What’s the average Singaporean? I guess the authors meant that average household expenditure is $X and average household income is $Y, so 100%-(X/Y) gives 55%. This doesn’t mean a typical household saves 55%.  If we tabulate the savings rate of 1000 households, we get a distribution (bell curve histogram). Given this histogram,

( issue: ) is it valid to find a population average? I can only speculate

  • low-income households save less (in general but not always),
  • younger households save more for housing and raising family,
  • pre-retirement households may save more as their grown-up children have left
  • retiree households may have negative savings rate or possibly excluded from the calc

It’s questionable to compute aggregate statistics across any two distinct categories.
— Issue: most Singaporeans in the survey would have 30%+ of monthly income locked into CPF (compulsory savings scheme)

I would guess the alternative statistic of “savings rate as percentage of take-home salary” is much lower among Singaporean families with kids. The median might be 10-20%
— Issue: is mortgage payments considered savings or an amount spent? For the P+I,

  • I feel the interest portion is definitely an expenditure.
  • The principle portion is more like investment (savings)

— issue: is rental and dividend income captured as income? I would doubt it.

In conclusion, it’s hard to have any confidence in these numbers. My target is Brbr, focusing on non-investment expenditure.

##[22]wise consumer: hallmarks

Posted on by tiger40490

— showcase of HallmarkA: why avoid branded colleges
If a branded top-quality middle school costs $20k/Y over 2Y, then many would be able to afford it, but could the brand give the parents esteem for decades?

In contrast, a branded college does make the parents proud for decades, and makes the graduate stand out in over-crowded dating markets, but look at the price tag. If the 70k/Y price tag is clearly /affordable/ to you, then you won’t need to be a “wise consumer”. For most families, however, 300k over 4Y is too high, so these families need to assess the benefit/cost.

Those with insider info often realize the benefit is not so high.

— (hallmarkA) At a fancy restaurant you taste something very nice (and expensive) . Later you find out it is similar to a cheap supermarket item that you have never tried.

The fancy restaurant version is subtly different (therefore expensive) but to the first time taster, the supermarket version is equally delicious. Even if company pays, I would still prefer the cheaper version.

— (hallmarkI) mass market .. How relevant (to me) are mass market statistics? Many mass market surveys are increasingly irrelevant to me, as they reflect ordinary people’s
* commute conditions
* work hours
* reported work stress, burn-out
* workout, nutrition, BMI
* savings, retirement plann, mtg, rental burden

These so-called “mass market profiles” are increasingly different from my profile. Therefore my buying priorities are different, too. Am in an exclub defined by myself, not based on FOMO.

— (hallmarkI) exclub/miswanting..

Property agents, car salesmen, college admission offices, luxury product sales/marketing teams … make huge efforts to impress on us the differences between the haves vs the the have-nots.

Some of them in their unspoken hint are careful to position you, the prospective buyer, as above average in the local market but somewhere below average among “my clients”. They like to describe their existing clients as filthy rich, indirectly setting role models for the rest of us.

That’s a form of mental manipulation and brainwash. However rich you are, there are always some “existing clients” who are better off! Exclub.

Now in my late 40s it’s becoming increasingly clear that those “haves” have acquired a lot of white elephants. For example,

  • car is not an asset.
  • wines, fancy electronics are not always good for their children’s wellbeing
  • branded college is not necessary, but a conducive environment is.

— Two hallmarks of a wise consumer

  1. hallmarkI (vague): knowing what things are truly important to yourself.
  2. hallmarkA: knowing what unpopular/unconventional Alternatives are Actually Acceptable to yourself

Some examples that help explain the hallmarks

  • [AI] eg: free books
  • [A] eg: refuse to buy sports merchandize. Use simple substitutes instead.
  • [AI] eg: avoid branded sports shoes. Try the low-cost shoes and trust your own feeling of comfort
  • [A] eg: slightly dented fruits