Singvestor's awakening

Where are you and where are you going?
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BRUTE
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Re: Singvestor's awakening

Post by BRUTE » Thu Jun 30, 2016 10:54 pm

another great month for the only journal brute reads regularly on this forum ;) maybe it's all the pretty and colorful diagrams that attract brute.

now brute isn't an expert (maybe singvestor should seek 7wannabe5's council), but he thinks humans should be quite sure before getting engaged. it seems a serious thing to do.

regarding the somewhat uninspiring job, brute has given up inspiration through jobs. there's plenty of inspiration to be found with friends, books, and the world at large. jobs are for money. if they inspire, that's a bonus to brute.

lastly, brute has a question about Singapore brokerages. brute checked, and the Singapore stock market seems to have <100 stocks on it. singvestor can probably buy securities on other stock exchanges, but doesn't he have to pay that country's capital gains tax then, whereas SG has none? how do Singaporeans usually set up these types of things?

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Dragline
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Re: Singvestor's awakening

Post by Dragline » Thu Jun 30, 2016 10:58 pm

Congrats on the progress. Really like the exponentially functioned graphs.

The Power of Compounding compels you!

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singvestor
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Re: Singvestor's awakening

Post by singvestor » Fri Jul 01, 2016 1:15 am

Thanks, Dragline! Slowly I am getting into the territory where it can be felt with higher dividends etc. Still feels so terribly slow!

Hi Brute, glad you like my graphs!

You are right about the engagement... Big deal... Girlfriend is already living with me for four years and things are good. Still I am over-analyzing things a bit.

Regarding tax free dividends in Singapore:

Short explanation: Dividends from shares/ETFs listed in Hong Kong and Singapore are not taxed since both countries do not have capital gains tax. Thus I only keep ETFs listed in both countries in my portfolio.

Long explanation: In general Singapore does not tax any dividends I receive, be it on stocks listed here or elsewhere. Unfortunately most countries still tax them and my broker will then bill me withholding tax. I wrote a detailed blog post on this once: http://singvestor.com/withholding-taxes ... gn-stocks/

Singapore is really investor friendly as there is no capital gains tax whatsoever. The currency is trading in a narrow band to the USD. Hong Kong is not bad either, with the HKD pegged to the USD and no capital gains in place either.

Singapore even has a great singapore saving bonds program in place, where residents can buy bonds with virtually no risk and higher returns than fixed deposits. Quite nice!

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BRUTE
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Re: Singvestor's awakening

Post by BRUTE » Fri Jul 01, 2016 1:37 pm

but to get a more diversified exposure, like US and other stocks, SG/HK ETFs are not that optimal. HK seems to have some Vanguard and other index funds at least, but there's only one s&p500 and the rest seems mostly asia/pacific region funds. :(

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singvestor
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Re: Singvestor's awakening

Post by singvestor » Sun Jul 03, 2016 8:57 pm

Brute is right. ETF choices are not too great on both exchanges and liquidity is not the best, because of the low trading volume.

Currently the portfolio is not diversified enough and pretty much in a mess:

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Looking at only the stock index fund portion:

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Currently ~85% of the stock index part of the portfolio are in Asian shares and the remaining 15% are in European ones. This is not ideal.

I have been avoiding US shares because of the indirect taxes I would need to pay (even when buying a HK listed US ETF the withholding tax still applies) and the feeling that US stocks are very overpriced. The rational side of me knows that time in the market beats timing the market so I will aim to buy some of Vanguard's S&P 500 Index ETF and then pick up some more whenever there is the opportunity to average down a bit.

Detailed portfolio is here: singvestor.com/portfolio/

I am feeling relatively comfortable with a portfolio with a lot of Asia Pacific focus. I moved to Asia 10 years ago partly because I was very pessimistic about the outlook for Europe. Having said all that, currently the portfolio has too much diversification risk and I have to add some US stocks to the mix as well as increase the European portion of the portfolio.

Target allocation idea for the stock index portion of the portfolio:

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Just a first idea...

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singvestor
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Monthly update #13, July 2016

Post by singvestor » Tue Aug 02, 2016 6:50 am

Where does all the money go?

I used to think that I became more frugal and smarter with money once I embarked on the ERE journey but then I ran the numbers:

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Looking at the spending percentages I seem to be making good progress, funelling more and more money into savings while the share of fixed expenses and discretionary spending is going down.

Unfortunately things are not as good as they seem:

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Looking at the money in absolute terms it quickly becomes clear that I mainly avoided lifestyle inflation the last few years after making big improvements to discretionary spending between 2012 and 2013.

I believe I should be able to live very comfortably of a monthly allowance of SGD 4,000 (~ USD 3,000) in retirement. Singapore is very expensive, but I should be easily able to spend a lot less. I would probably choose to base myself in Europe during retirement, somewhere warm, sunny and cheap like Spain or Portugal

As my income is increasing I have to find ways to cut spending and to avoid all lifestyle inflation.

Monthly update July 2016

Saved only 33.2% of post tax income, a terrible performance. I spent a lot of money on air tickets and trips, including a vacation to the Philippines over Christmas and New Year. I did not spend a lot of money on things, but a lot on activities including traveling, nice meals and so on. Definitely something I have to work on!

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Portfolio performance

In July my portfolio increased by SGD 6,526 to SGD 140,291 (=USD 104,686). The gain was made up of fresh investments of SGD 3,392 and a gain of SGD 3,134.

It is an arbitrary milestone, but for the first time I broke through the USD 100k mark, which feels nice.

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Investments year-to-date vs. plan

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In July I invested SGD 3,392 which brings the yearly total investment for 2016 to SGD 27,628. Things are going ok and I am SGD 2,828 ahead of schedule.

Dividends received

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In July I received SGD 922 (= USD 688) in dividends, which is a personal record. Already now I have received more dividends than in the whole of 2015.

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Hypothetical monthly passive income

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SGD 468 per month. So I guess I am about 12% FI now. Slow but steady progress!

Outlook

Slowly I am feeling the effect of compound interest becoming stronger and I guess things will improve a lot in the next two years or so. Still I am not happy with my spending habits and have to make a more conscious effort not to spend so much money.

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BRUTE
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Re: Singvestor's awakening

Post by BRUTE » Tue Aug 02, 2016 11:30 am

avoiding lifestyle inflation, especially in such a fine country (tm), is a great achievement. brute also wants to congratulate on breaking the 100k USD mark.

regarding the activities/experiences singvestor is buying, like dinners and vacations, what are they emotionally connected to? is it stress relief? good times with friends? dates? family? colleagues? is singvestor doing them alone or with whom? maybe it's possible to take a step back and see what role these things play in singvestor's life. maybe they're just what he enjoys, and should therefore be guilt-free and accounted for in the FI plan.

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Dragline
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Re: Singvestor's awakening

Post by Dragline » Tue Aug 02, 2016 12:58 pm

Nice progress -- and nice graphs, too.

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Re: Singvestor's awakening

Post by flip711 » Tue Aug 02, 2016 2:49 pm

You're making some seriously awesome progress, and I really enjoy looking at your graphs. Your journal inspired me to develop my own "4% SWR" section in my spreadsheets, which are endlessly being honed. So thank you for the inspiration. Despite your displeasure with your savings rate, you're making great gains in the investment realm!

As I'm making median salary in a high cost of living area, I've had to err towards more frugality and reduction in consuming to make a dent saving and investing. One strategy that I really enjoy are "no spend days." This requires I have my transit pass, gas in vehicle, and food for the days paid for prior. This also let's me try and "beat" my better months. Last month I had 15 no spend days, a record this year!

Anyways, I just wanted to stop by and say a) nice journal and b) maybe you'd like to hear about the "no spend day" game.

Cheers!

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singvestor
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Monthly update #14, August 2016

Post by singvestor » Thu Sep 01, 2016 4:29 am

Thanks Brute, Dragline and Flip711! I have been thinking about the activities and experiences I have been buying. Mostly they inspire me and are worth the expense, but I guess 80% or so could be done differently or cheaper once retired. Slow traveling in the off-peak season and spending some months each year in a low cost of living area would make life much cheaper.

The no-spending day concept is intriguing! My only problem is that all my bills are on autopay - maybe I will just count impulse/discretionary spending?

Monthly update #14, August 2016

In August I traveled to Latvia and it was a strange experience. Rich history and culture, beautiful landscapes, nature and good food, but of all the 35+ countries I have been to Latvia is a bit strange as people seemed very unfriendly towards me there. Maybe because I was there with my Asian girlfriend? We have traveled to Scandinavia and Estonia and loved it a lot, but somehow Latvia was very different. I like being in Finland or Sweden where people respect your privacy and are very reserved (politely) towards people they don't know. Giving people space and not bothering them is very important. In Latvia it did not seem like polite reservedness - more like outright hostility. So of all the 35+ countries I have been to Latvia has been the hardest to immediately like.

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Riga, Latvia's capital is a pretty place

Needless to say this kind of perceptions are normally silly and the problem is never the country but most of the times the visitor. In just one week it is hard to get anything but a rough glimpse of a place. No idea what I did wrong or if I just went to the wrong places? Probably Latvia is an acquired taste and once retired I will probably go back once to clarify the mystery when I have a few weeks during retirement.

ER(E) Scorecard

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On the way to Latvia I managed to lose my wallet with EUR 800 cash in it (I am an idiot), scratched rental car (cannot park, had insurance, but AVIS takes 15 days to provide the documents they need) and received a surprising windfall of SGD 7,500 (EUR 5,000) at the end of the month.

This led to a savings rate of 56.5% including windfall (of course I invested it) or 31.% excluding the windfall "income". Not quite worthy yet for the extreme early retirement...

Portfolio Performance

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In August my portfolio increased by SGD 15,086 to SGD 155,377 (=USD 104,686 / EUR 102,206). The gain was made up of fresh investments of SGD 9,921 and capital gains of SGD 5,165.

Investments year-to-date vs. plan

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As I was lucky to receive a windfall I had no exceeding my target despite all blunders and I invested SGD 9,921 instead of the planned SGD 2,500.

Dividends received

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In August I received SGD 237 (USD 174) in tax free dividends.

Hypothetical monthly passive income

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Progress is accelerating, I am stoked!

Outlook

For the current month I have decided to focus on health and sports and have made the following goals for September:

- 12 times exercise
- minimum 21 days without alcohol
- see 2 interesting exhibitions
- 4 sessions of studying Chinese

This should put me in better shape mentally and physically.
Last edited by singvestor on Sun Oct 02, 2016 1:49 am, edited 1 time in total.

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BRUTE
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Re: Singvestor's awakening

Post by BRUTE » Thu Sep 01, 2016 1:04 pm

wow, shit's going up and to the right for singvestor :)

feels to brute like singvestor crossed some kind of boundary in spring of this year, and things are getting serious now. it always seems to be the $100k mark, interesting.

also brute just realized that singvestor increased his income sixfold in 8 years - that's crazy. maybe increasing income is one of the better strategies to achieve FIRE, at least up until a point. it would probably prove more difficult to do another 6x in the next 8 years ;)

another side note, it seems to brute that singvestor travels A LOT. brute's a homeless nomad and doesn't seem to travel as much as singvestor ;) is this a Singapore thing, or just a personal preference?

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Viktor K
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Re: Singvestor's awakening

Post by Viktor K » Thu Sep 01, 2016 3:17 pm

Hey just wanted to say I enjoyed catching up on your journal for the first time. I too am thinking that I need to make a 4%SWR graph like you have. Seems like a great way to stay optimistic! Hope everything goes well this month and I'm looking forward to further updates :)

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Re: Singvestor's awakening

Post by jacob » Thu Sep 01, 2016 4:29 pm

@brute - Increasing income helps a lot in the beginning. Why we talk about easy-mode and hard-mode. Once your net is about 10x-15x of any income you can reasonably make, income becomes less relevant and preservation and alpha becomes more relevant. This can be quite demotivational when it comes to working for money. #fireproblems

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BRUTE
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Re: Singvestor's awakening

Post by BRUTE » Thu Sep 01, 2016 6:19 pm

makes sense. still seems that for a lot of individuals, it makes more sense to increase earning for a few years before focusing on increasing savings rate. if these endeavors are mutually exclusive, of which brute isn't entirely sure.

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singvestor
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Monthly update #15, September 2016

Post by singvestor » Sun Oct 02, 2016 4:12 am

Hi Brute, travelling is probably a personal preference for me and even more so of my girlfriend. I moved to Asia to explore it as much as possible, so it is a bit of a hobby... Unfortunately quite an expensive one. You have no home and are a nomad? That sounds interesting! Like a digital nomad? Or as a consultant?

Monthly update #15, September 2016

the most painful thing first:

September Goal Review

- 12 times exercise: failed (only 9 times)
- minimum 21 days without alcohol: failed (only 17 times)
- see 2 interesting exhibitions (semi failed but took a pottery class and watched an artsy Israeli movie)
- 4 sessions of studying Chinese (failed - only studied once)

Broken TV

In September my TV, solely used for the occasional Netflix binge broke down. The nine year old 37" LG TV had been flickering and one day did not want to turn on anymore.

Finally we could upgrade to a nice 60" ultra HD TV! The girlfriend and I soon had settled on a nice SGD 2,200 TV set and were ready to pull the trigger, but

Then in a moment of clarity I decided for another approach:

Some Youtube videos and a downloaded service manual later I was taking the TV apart. A few capacitators on the power board seemed broken and the board was discolored. I then went on ebay where a guy from Poland happened to sell a replacement board taken out of a TV with a cracked screen.

Long story short: My TV works better than ever, no more flickering and only spent SGD 75 (USD 55) instead of SGD 2,200.

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TV during "surgery" and closeup of broken power board.

ER(E) Scorecard

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Savings rate for September was 33%. Not good!

Danang, Vietnam

In September I travelled to Danang in Vietnam and spent 4 days in the area. Definitely a great place to spend some time during retirement. People were nice and the landscape (seaside + river + mountains) is very interesting. I rented a scooter and drove around town, it was a great experience. After a while the mad traffic and chaos just did not bother me anymore and I got into a nice flow of riding around. Fun! When a tropical storm hit at night and the whole district was without power I remembered the downsides to staying in emerging countries.

Portfolio Performance

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After a fantastic August my portfolio fluctuated a bit in September. In the end my portfolio increased by 2% or SGD 3,159 to SGD 158,536 (= USD 116,297 / EUR 103,448). This gain consisted of fresh investments of SGD 2,728 and capital gains of SGD 431.

Investment vs Plan September

I invested SGD 2,728 in September – slightly above plan.

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Dividends received

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In September I received SGD 109 (USD 80) in tax free dividends. Not very much, but the main dividend month October is coming!

Hypothetical monthly passive income

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Slowly crawling up...

Outlook

October should be a good month with lots of dividends. Again I set my personal goals as follows:

- 12 times exercise
- minimum 21 days without alcohol
- see 2 interesting exhibitions

Let's hope I can make it!

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Viktor K
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Re: Monthly update #15, September 2016

Post by Viktor K » Sun Oct 02, 2016 7:38 am

singvestor wrote:Savings rate for September was 33%. Not good!
On the contrary, let's talk about that TV save! Way to go on fixing the old one rather than throwing it to the curb!

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Re: Singvestor's awakening

Post by Noedig » Sun Oct 02, 2016 9:03 am

Great journal. You are someone with whom it has evidently clicked and who is leading a more intentional life, and giving us the facts.

Hope you feel you are getting a satisfactory balance between things day-to-day and the planned life. Feel the flow.

Epic job on the TV. People just throw stuff away rather than fix, because we're all used to getting upsold consumer goods made by underpaid Chinese.

But fixing is indeed the way to go. Kudos for that.

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BRUTE
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Re: Singvestor's awakening

Post by BRUTE » Sun Oct 02, 2016 11:56 am

wow, repairing the TV? renaissance man in the house :D

brute isn't really a digital nomad or a consultant, more of a bum ;)

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singvestor
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Monthly update #16, October 2016

Post by singvestor » Mon Oct 31, 2016 10:23 pm

Worst things first: October Goals review

- 12 times exercise (achieved: 12 times)
- minimum 21 days without alcohol (shamefully failed: 14)
- see 2 interesting exhibitions (failed: saw only 1)

Saving rate October

In October I saved 38.2% of my post tax income, lowering the year-to-date savings rate to 40.7%.

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The good news is that I have already now saved nearly as much as in the whole year 2015. I have already surpassed my investment goal for 2016 and will most likely exceed my savings goal as well.

Portfolio update October

In October my portfolio increased by 2.8% or SGD 4,434 to SGD 162,970 (USD 117,150). This gain was made up of fresh investments of SGD 3,816 and gains of SGD 618.

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Investments-vs-Plan

In October I invested SGD 3,816. This was SGD 816 more than planned. So far the year is going quite well!

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I am definitely going for a new savings record this year, thanks to the small windfall I received in August.

As Brute had suggested earlier I am trying to diversify and have been buying the iShares EURO Dividend UCITS ETF. This gives me more diversification also in terms of currencies.

Currently my portfolio is too heavy on the HKD and things would go South immediately if the Hong Kong administration decided to abolish the tie to the USD. Switzerland has shown what can happen when central banks take this kind of decision, so diversification is the way to go for me.
The ETF is domiciled in Ireland and listed on the Euronext Amsterdam exchange, which is the best possible tax option for me. There are no withholding taxes on that exchange for Singaporean investors, so I can enjoy tax free dividends.

Dividends received

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This was the highest dividend month for me so far. SGD 1,822 tax free dividends were credited to my account.

Hypothetical monthly income

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Slowly but steadily improving. I will feel better once this finally surpasses the SGD 1,000 mark

Coast FI age

For fun I calculated the following: If I suddenly decided to stop investing, when would I be able to retire based on growth of current portfolio? Assumptions: 6% annual portfolio growth, 2% inflation.
Result: I can retire at age 86... For European males chances are slim to reach that age. So I better keep investing!

Outlook

I am well ahead of targets for the year, but am more determined than ever. Will continue saving full steam to escape the office earlier.

+++++++++++++++++++++++++++++++++++++++++
This is the end of this month's update.
Just rambling reflections on life below
+++++++++++++++++++++++++++++++++++++++++


Reflections about working

Advantages of my job

- SGD 140,000 (~USD 100k) salary
- Only SGD 10,500 tax per year
- Have been working in the same job 5 years and became very good at doing it with minimal effort
- Nice colleagues, no aggressiveness or douchebags
- Commute is 30 minutes including 10 minutes by bicycle and 10 minutes walking
- Part of talent program and get pampered by the company occasionally
- Free mobile phone

Disadvantages of my job

- European Company is over 100 years old and being overtaken by faster local competitors
- Day to day work is uninspiring and I spend at least 3-4 hours each day on the internet
- No higher purpose or exciting vision
- "Only" 21 days of paid holidays (much less than in Europe, but more than in the US I guess)
- No time to do real fun things like backpacking around for a few months
- Soul crushing boredom

Sometimes I realize that I am really lucky and am in fact quite well off. On other days I feel that I earn much less than my peers in other companies and that I have been in the same job 5 years. Oh well.
Singapore's economy is getting worse and worse. Changing a job is close to impossible. My bosses keep saying that my next job is around the corner, but I have given up. So I am stuck. I am not dreading to go to office on Monday mornings, it is pretty easy going. It does not stress me in the slightest and some people in the office even are close friends. With some I have even gone to private holidays before!

Reflections about the girlfriend

My girlfriend is a true minimalist at heart and prefers experiences to things. The other day I saw her rinsing a ziplock bag to reuse it, something I have to admit I am often too lazy to do. She is very successful at her career but never chose to participate in the high fashion, show-off arms race that most women in her industry in Singapore participate in. She also discourages me from drinking beer and motivates me to exercise instead. Conclusion: a keeper! :)

Confessions of my ERE sins

Once again I sinned quite a bit.

* Spent SGD 400 (USD 290) to fill stocks of food, beer and snacks at home since I will receive some family visitors in October. 1 small can of beer costs USD 2.2 here so it is quite the expense. Not even that great beer, just Asahi.
* Went to Ikea to replace some worn out things in my flat (SGD 70)
* Took the girlfriend to several nice dinners and once managed to spend USD 115 on a dinner for two. Definitely too much! I need to get back into cooking as it is healthier and very therapeutic
* Bought flight tickets for Chinese New Year (USD 450)
* Bought a fancy new Kindle for my girlfriend (USD 250)

November goals
* Get rid of all clothes in my flat that I do not wear anymore
* Try to reduce number of possessions further
* 21 days no alcohol
* 12 times exercize
* Finally get back into improving my Chinese
* Make use of my talent program perks at work to get a coach
* "declutter" the mind and come to terms with some old issues

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Re: Singvestor's awakening

Post by AussieGirl » Mon Oct 31, 2016 11:14 pm

Hi Singvestor. Great journal and great graphs. I'm inspired to produce something similar for myself. Thank you!

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