I've been a big fan of reading the investing section of the "Me & My Money Series" for a very long time. Hence, I was grateful and honored to be invited over for the interview feature which you can refer to the link here.

I'd also like to use this chance to thank in particular Rachael and Chee Siong for their hard work and professionalism. They've been a very nice personnel to work with during the course of this time.

The interview itself wasn't very comprehensive because obviously there was limitations to how much I can explain myself in details in the one-page interview itself. Blog however is a totally different thing and across the past 600 articles I have written I think I have expressed myself quite clearly on some of the stance I am taking.

Also, I think I needed to highlight to new readers that the intention here was not to flaunt and compare across peers on who is doing better financially. The intention here is to inspire one another to do better than who we are ourselves the day before. I think if we look at the objective this way, it's a very achievable target for everyone.

I received a few feedback from friends, colleagues and readers who has emailed me on some of the questions. I thought I could also cover it here in more detail on my thoughts.

It was mentioned that you are currently a financial controller, so your pay must be very high? What about your expenses now that you have 2 children to add to those expenses?

B: First of all, I think what is high or not is subjective on its own.

If I was looking at it from an individual point of view, I do earn above the average median salary paygrade. However, if I were looking at it from the household point of view, it is usually nothing more than a combined husband-wife working for a median salary paygrade. My wife is technically a housewife and she runs her own business so the profits usually go back to expand the business.

For expenses, I've previously mentioned in my monthly updates that cashflow is very tight. I think the most contributing factor has got to be the education, the milk powder, the diapers and I've also engaged 2 domestic helper where I have to pay both their levy and salaries every month. These days I even hop onto the neighboring countries to buy the milk powders. It's definitely a tight play in terms of expenses here.

You talked about the human capital as one of your best investment decision. Can you elaborate on that?

B: I previously shared an article (link here) about the importance of human capital and how I transition from one to another.

In essence, human capital is our ability to churn out returns based on the physical presence or activity that we do. Most of us started off as salaried employees the moment we graduate from the university. It is important to recognize the the amount of potential future value that we can churn out just by working until the age of 65. The faster we are able to focus our energy towards increasing this value, the faster we are able to save a part of those income which we can then compound it via the investing method.

A 5% gain on a $1m portfolio will ultimately be better than a 20% gain on a $20k portfolio. I think that's basically the idea.

I saw you mentioned in the article that it was a mistake to buy whole life insurance. May I know the reason why as I am considering to buy one in future given that it will help to provide some relief if anything happens to me .


B: I wrote an article here not too long ago when I surrendered my whole life policy.

I think it is important to acknowledge that products like ILP and WL are not bad on its own. I must admit that they do cater to different people with different personalities and they can be an important part of the personal finance portfolio to have.

The only reason why I mentioned ILP and WL as one of my worst investing mistake is because I could have done better with a term life earlier on in my life, paid lesser premium and I could have the flexibility to terminate it as and when I do not need them.

At this point, I believe our family are sufficiently covered in terms of the financial need should anything happens to me. I believe additional items like CPF (where I have done my CPF Nomination) and company 18 months salary death benefits payout will also be a huge help for the family. But that's just about me.

I'm also a big advocate of having offense as a good form of defense.

Question 4

The interview shows that you are making a return of 19.2% over the past 6 years. Is that sustainable? What about the losses? Are there any?

B: As much as I'd like to keep the high returns momentum going, I'm not naive enough to think this will continue forever. I'm also not going to spin a story and says how good I am to be able to churn out that sort of returns thus far like most marketing gimmicks.

One thing I can say for certain is that the returns will drop at some stage and it is not wonder to see why.

I'd love to also reflect on past losses and have made many throughout my investing decision. On top of my head, I can already think of Kingsmen, ISOTeam, Silverlake, Accordia and Ascendas Hospitality Trust.

I'd also love to reflect on past winners that I have made a profits on that I think makes a bad investment on hindsight. Sometimes, it's so hard to distinguish if it's luck that's helping you or skills that you are getting out of.

Nothing is certain, that's the fun element about investing.

Question 5

Your portfolio looks pretty concentrated and it is also only covering the SGX market. Are you not afraid of over-concentration?

B: At the moment, I do not see it much of a problem yet.

I like the governance that covers most of Singapore companies and it cannot be said to be totally the same if we start looking into unknown territories.

The US market is an interesting one but I have always find it to be expensive on valuation basis. I think during a deep recession like we had in 2008, it's a very good opportunity to start looking at some big cap companies over there.


Final Thoughts

I reminded about this at the start of the article but I'd like to remind again at the end that it's ultimately about becoming a better person, both spiritually and financially than who you were the day before. It is never the intention to compare one status and keeping up with the jones.

If you are still constantly keeping up with the jones, you may want to read this article here which is pretty self explanatory on why there are always things and someone who are better than you.

Last but not least, I'd like to express my gratitude to all the fellow bloggers - the senpai whom had achieved financially great status but still remain humble, the 12 immortals in our chatgroup as well as all the friends and readers who have been supportive of me since the very start. I think it is important that we keep giving each other strength so we can move on to a better level scale together on this very journey.