Personal Finance Consultants may argue that the money you spend on small purchases (e.g. cup of Starbucks coffee) add up together and redirect towards a huge expenses. Assuming it costs $5 per cup, you are spending over $70 in a week. This is why you can save thousands of dollars in two years if you reduced your caffeine expense.
5 Clever Ways To Save Money on Coffee…
1. DO NOT EQUATE PRICE TO QUALITY
A blind taste test by New York Magazine’s Adam Platt showed that people prefer the inexpensive Dunkin Donuts coffee to the upscale Starbucks coffee. Even though it is expensive, it does not mean it tastes good. So, try the small coffee shops across your office.
Image Credits: Cherrysweetdeal via Flickr
2. MAKE YOUR OWN BREW
Coffee beans are cheaper than Starbucks; try to make your own to save a significant amount of money. If you are feeling creative, buy black coffee and add your own mixture of milk, cream, and sugar.
3. GIFT CARDS
Fish for discounted gift cards on Ebay or Carousell. This may not be worth your time if you are an occasional coffee drinker. But, if your caffeine habit is emptying your pocket, this tip will save you quite a bit.
McDonalds may have “free coffee Mondays” so follow them on Facebook or Twitter.
5. REDUCE YOUR CAFFEINE INTAKE
Lastly, one sure-fire way to help you save a significant amount of money is to reduce your coffee intake. I know it takes a lot of willpower at first but it gets better as time passes.
Do it gradually, you cannot force this process or you will experience symptoms of withdrawal (i.e., headache, depression or nausea). Eliminate a cup per day.
Reducing your caffeine intake will not only increase your savings but it will also increase your survival. It decreases your risk of hypertension and increases calcium absorption to help keep your bones and teeth strong.
Life insurance is an important tool for an individual’s financial plan. Because you don’t have a crystal ball to predict what will happen to you tomorrow and the day after, you need to transfer this risk to a life insurance company – by paying a premium.
Fortunately, you don’t need any divination to find out how much life insurance cover you need. Since this article is penned in the year 2015, i have reasons to believe you belong to the Gen Y’s population and is knowledgeable enough to work out your own insurance needs by following the steps below. That is also the reason why very soon you will be able to purchase life insurance cover directly from the company without the need of financial planners. (If you belong to the Gen X’s, i don’t see why you need any life insurance besides your Medishield or Medishield Life)
Working out how much you need is no rocket science. It’s as easy as sitting down with a calculator on your hand and asking yourself a few questions.
1. Do i have any dependants?
This should be the first question you ask when you buy life insurance. You want to provide for your loved ones should something untoward happen to you.
Let’s assume Michael has a wife and a 3 years old son that he need to take care of. He is also providing allowance to his aged parents who have retired and not working.
2. How much do they need?
Finding out how much your dependants need is important to determine how much life insurance cover you should be looking at.
Now Michael contributes $2,000 a month to household expenses which include paying for the bills, foods, daily necessities and children expenses. His wife is also working and contribute the other half of the household expenses amounting to $2,000 a month.
If something unfortunate happens to Michael tomorrow, his wife would have to shoulder the responsibility of paying for Michael’s share and may not have enough to cover a monthly household expenses of $4,000 a month.
So Michael wants to protect his share of liability.
He needs to provide for 20 years of household expenses until his son graduates from university and starts working.
He will need to cover himself sufficiently such that the large sum of money paid out can be invested to generate a passive income of $24,000 a year. Let’s assume a modest 4% rate of return, Michael simply divide $24,000 over 4% to work out $600,000. That is the cover he needs to provide a passive income of $24,000 a year for his family.
Once they no longer need this passive income, the bulk of this money could be used to purchase a home for Michael’s son.
3. What about mortgage, other loans or even children’s tertiary education?
For mortgage you would have taken up a mortgage decreasing term assurance to take care of that.
if you look into loans and children tertiary education, you could have factor those into your monthly expenses. That is also to say i am assuming you would have set away a portion of your monthly salary into a portfolio that gives at least 8% of growth to your children education fund.
4. Does that means i don’t need any insurance cover if i have no dependent?
You would hope so. But you might want to look into replacing your income should you become disabled or get critically ill. That is when you should consider getting yourself covered for total permanent and disability until the age you retire.
As for critical illness, a simple rule of a thumb is to cover for 5 years of your income because of the prognosis of cancer (or the survival rate of cancer, being the most common critical illness in Singapore) You can basically go without income for 5 years since you will be focused on recuperating and going for chemotherapy and other cancer treatments.
For hospital cover, don’t forget you have your Medishield or Medishield Life to take care of them.
What’s next?
We should be expecting a web aggregator to be rolled out in the first quarter of 2015. Now that you know how much you need to get yourself covered, most consumers can actually skipped the middleman to pay a lower premium and make use of web aggregator to find the most suitable product at the most affordable price.
One of Singapore’s favorite pastime is shopping. Since Chinese New Year is coming up, you may wonder where is the best place to get some cheap deals online.
Wonder no more! There are numerous websites that offer deals and discounts, but some of them are hard to navigate. Be aware of the websites that require subscription because you will receive tempting deals regularly. The good news is that…you can always unsubscribe and still use the site perfectly.
Also, some pop-ups that say “check discount code here before you shop” may not always be as rewarding as it seems. With that in mind, here are 4 Money Saving Websites That Work.
Topping our list is the ever-so-famous Groupon. Groupon makes women go gaga over their outrageously discounted luxury goods, bags, watches, beauty products, lifestyle services, and getaway deals. You can conveniently pay through for Debit/ Credit Card, Paypal or American Express.
Save up to 58% on your travel expenses though Home Exchange. It is a popular website where people rent out their own home and find a place to stay while they travel. You will get to choose from about 60,000 members in over 150 countries around the world. With this system, you will get a local feel and get to be toured to places that you will have never visited if you travelled by tour packages.
Similar to Groupon, Deal.Com.Sg by Ensogo lets you select from a wide variety of food or buffet packages, cheap hotel accommodations, travel packages, and amusement deals (e.g. Universal Studios Singapore). Also, you can conveniently pay through for Debit/ Credit Card, Paypal or American Express.
To ensure customer satisfaction and superior shopping experience, Ensogo handpick their offerings by working with highly reputable merchants and brands.
Social networking sites like Facebook and Twitter offer doors to access special deals by letting you follow the companies you wish to buy from. For instance, to get special deals on air fare and gadgets, follow Amazon.com or Virgin America on Twitter.
Follow Money Digest on Facebook to get cheap deals on various companies all over Singapore. Best of all? These methods are free.
Eighteen years ago, Lady (not her real name) entered the workforce like many fresh graduates and earns a humble salary of $2,200 per month.
A sole breadwinner of a family of 4, she need to desperately figure out how to survive and get by should a day she loses her job without sufficient savings.
In 2005, during her career transition, she came across her Central Depository statements and noticed that some of the stocks she bought during the early years has yielded some dividends. That was when it struck her that she could actually work towards generating passive income through dividends.
Back then, she did not have any background knowledge in finance and investment but her determination of working towards her goal of financial freedom has spurred her to learn investing by herself.
Like many young investors, she spent her free time reading investment books, finance blogs, watches CNBC and analyse companies on SGX’s website. Her curiosity has allowed her to equip herself with valuable knowledge in investing which is still relevant today.
In 2012, she made her first million dollar and an annual dividend income of $41K.
Q. Are you a spender or saver?
I am a saver although i have a soft spot for travel
Q. You have grew your portfolio to a million dollar from 2005 to 2012. That’s an incredible feat considering that the collapse of the Lehman Brothers happened in 2008 and the Eurozone crisis in 2009. How do you overcome your loss in 2008 and still hit your million dollar goal?
I didn’t see 2008/2009 as a crisis or a loss although some of my counters were in red. In fact, i felt just like my girlfriends during the Great Singapore Sale, but in this case, instead of buying bags, shoes and clothes, i was buying stocks.
Q. You have not looked back since then and continue growing your portfolio and passive income. Did you suffer any setbacks during this period besides the financial crisis?
I have been fortunate. I did not suffer any major setbacks so far. Although i wished i hadn’t sold away Allergen and Citibank too early.
Q. What’s your best and worst investment? And how’s your current portfolio looks like?
My best investment is Apple (+71%), Facebook (+145%) and Starhub (+85%). Both Apple and Starhub are giving me good returns on dividends yearly. My worst investment of late is Sabana Reit. I share an update of my portfolio every month. You can check out my latest portfolio here: http://ladyyoucanbefree.com/2014/12/23/my-stock-report-card-for-dec-2014/
Q. Are you currently employed or have you retired? If you have retired, what is your current passive income/dividend?
I am currently employed. My current passive income is $59.072.58.
Q. Does your spending habits change as your portfolio grows? Do you spend more than your passive income and how do you manage your personal finance?
I do not spend more than my passive income. I am still learning to improve my spending habits and I learnt that little indulgence do add up a lot. (For example, my indulgence in my favourite iced milk tea) As i said earlier, i also have a soft spot for travel.
Q. What financial planning have you done for yourself? And what’s your retirement plan?
I have just bought myself a retirement home, medical insurance for myself and my family. Moving forward, i will be continuing my journey in accumulating and exploring passive incomes that allows me the freedom to chase after things that i am passionate about and to checkoff my bucket list at http://ladyyoucanbefree.com/2014/05/31/bucket-list/
Q. What is your advice to young adults who have just started embarking on their career journey?
Love what you do and money will follow. Stay Hungry, Stay Foolish. Check out Steve Job’s Stanford Commencement Speech and be inspired!
Q. What about advice to other investors?
I don’t think i am qualified to provide advice to other investors. I would love for them to drop by my blog at http://www.ladyyoucanbefree.com and share notes with me. Let’s learn from one another.
* Lady’s portfolio has now grow to more than $1.6 million and her passive dividend income currently stands at $59,072.58. She is currently aiming for a passive income of $65K.
Sometimes, stepping out of the cubicle to be a self-determining entrepreneur or a freelance worker gives you the opportunity to find yourself. It may also bring more money in the bank. Nonetheless, it will give you freedom and other self-benefiting outcomes.
Here are the 5 Benefits of Freelancing…
1. DOING WHAT YOU LOVE
As Confucius once said, “if you enjoy what you do, you’ll never work another day in your life”. It is a sad truth that many people drag themselves to work to do something they are not fond of just to get enough money to survive.
If you give yourself an opportunity to freelance or by being your own boss, you will be able to do the things you love and get paid for it.
2. FREEDOM TO CHOOSE YOUR OWN WORK ENVIRONMENT
Image Credits: Lisa Risager via Flickr
Since you are your own boss, you will be able to choose the most comfortable working condition for you. Redecorate your home office—the sky is the limit. With this power of autonomy, you will notice that little things you do can make a huge difference.
3. FREEDOM OF CREATIVITY
Often, people get into freelance to fulfill their dreams of creative freedom. As a freelancer you will be able to choose what direction you will take without a rude boss over-looking your shoulders.
You are the master of your own future. Mold the present by choosing which projects to engage in.
4. SET YOUR OWN WORK HOURS
Being able to have a flexible timetable gives you the opportunity to do more of what you love. There may be days where you want to work more and there may be days where you feel sick. Have an expected number of hours of work to ensure that time is managed and work is done even if there is no fix structure.
Setting your own hours can mean that you get to drive your children to school, you can go out for private errands during lunch, and you won’t miss out on your children’s school presentations. Yes! You will be able to spend more quality time with your family.
5. PLAN YOUR VACATIONS AHEAD
Many people struggle to have their vacations synced. But, when you freelance, you can plan your vacations ahead and fit your schedule with your family. By planning your vacations ahead, you not only pay for a cheaper air fare but you also won’t miss a work deadline.
Image Credits: Kamal Zharif Kamaludin via Flickr
Simply, by being purposeful freelancer, you will be able to wake up motivated and ready to start the day’s work.
