If there’s anything you’re looking to buy, don’t “Buy it now”.

If there’s anything you’re looking to buy, don’t “Buy it now”.

Instead, change your mindset to “Buy it tomorrow”.

This tip is simply about cutting down on impulse purchases that you make without much thought.

It gets really interesting once you start digging deeper.

Many studies have shown that the pleasure of shopping is caused by a chemical – dopamine – released in our brains.

And if we take a step further, research has shown that the dopamine hit doesn’t actually come from the purchase itself. It comes from the ANTICIPATION of the purchase.

From this, we can conclude that BUYING something won’t necessarily give you that excitement you’re looking for.

You can get that same enjoyment by window shopping and not actually buying anything, thus saving the money.

This is a method I use all the time.

If there’s something I see that I want to get, I don’t just buy it right then and there.

Instead, I’ll just sleep on it and buy it the next day.

But more times than not, the desire to buy fades and I no longer want it the next day.

5 Retirement Expenses to Prepare for

How does your ideal retirement look like?

Retirement planning is one of the major components of any financial plan. It allows you to build for the future based on your current circumstances.

While we can’t see the future with a crystal ball, what we can do is to plan for it.

Some of the most common retirement expenses one should plan for are:

Housing

Housing is a big expense no matter what stage of life you’re in. While the majority of retirees own their own homes, some still have to factor in mortgage or rent payments.

Transport

While you’ll no longer use your car for commuting to work, transportation is still a large expense. Insurance, gas, and repairs should be part of your budget. If you live in a city with public transport, see what senior citizen discounts you qualify for.

Health Care

According to a report by Asia-Pacific Risk Center, an average of US$37,427 will be spent on healthcare for each elderly person by 2030. It’s important to note that MediShield Life doesn’t cover some health care expenses like dental work, glasses, hearing aids and long-term care.

Food

As long as you aren’t planning on dining out regularly, your budget for food shouldn’t increase significantly. At the same time, you’ll have more time to cook meals at home.

Entertainment

How would you like to spend your retirement? Think about expenses for travel or even local entertainment like movies, museums, or concerts.

Quick Money Lessons

People are made poor by their desire to look rich. In other words, “act your wage”.

Having a college degree doesn’t guarantee you’ll make or save a ton of money. It’s all about real-life experience and knowledge.

Accumulating wealth requires discipline. Automating saving and investing is a “cheat code” to achieve discipline.

It is more important to protect your downside than to chase returns.

The most important part of solving a financial problem is realizing there is one.

COVID-19 & Your Investment Portfolio

The past couple of weeks have been the most insane period many investors have ever witnessed. The media has done a great job reporting it, there’s a lot of information out there. A lot of us are concerned and we should be concerned.

However, at times like these, we need to examine the facts. The fact is that COVID-19 is an event. It’s not structural, it’s not fundamental. And because it’s an event, we have to look back in history and we know how events like recessions eventually turn out. It’s not an “L” chart – markets don’t get knocked down and stay stagnant. But rather, it is a “U” or a “V”.

What you need, is to be very vigilant about your risk budget – making sure that you’re taking appropriate level of risk always make sense, especially in times of heightened volatility and the volatility we see now is probably going to continue. I believe we may possibly be down as much as 50% from the highs, similar to the financial crisis of 2007-08.

At this point you may question – why don’t I just get out and then get back in? Well, two reasons:

  1. First of all, you can be wrong. (I’ve learnt this the hard way at the beginning of my career.)
  2. Secondly, you would really have a hard time getting back in and the market does whatever it needs to do to prove people wrong.

Stock market volatility is akin to a roller coaster ride, it is dangerous for investors to unstrap themselves suddenly during the ride. Instead, during this period, it is advisable for investors to stay strapped in (invested) and average down the costs of investments in order to benefit when markets go up again.

To this day, I see people who got out in 2009 and never got back in – they missed a complete 10-year bull market. Warren Buffett has said, “The stock market is a device for transferring money from the impatient to the patient.”

And why will the markets go up again?

Historically whenever a recession happens, all of us – billions of human beings worldwide – always put in the collective effort needed to bring up our global economy again. 

In fact, governments are now doing all they can to ride us through this storm. The Federal Reserve has cut interest rates down to 0 – 0.25% to support America’s biggest corporations in meeting liquidity needs. The Bank of England has announced a similar plan. The International Monetary Fund has also pledged to mobilize its USD1 trillion lending capacity to help nations counter the outbreak.

So, don’t get caught up in the short-term emotion and the noise. Take care of yourself. Take care your family. And if you have an investment portfolio with me, rest assured that I’m paying attention to your portfolio during this period. If it needs to be re-balanced (when your equity-to-bond ratio shifts 20% or more), I will contact you promptly for a discussion.