Wednesday, 22 March 2017

Financial Review FY2016

FY2016 in Review 


In the previous financial year ended 31 May 2016, I set a saving target of S$43,000. As with last FY, I'm delighted that I met my target two paychecks early. This is largely attributed to an unexpected pay adjustment and higher bonus quantum.

While I really hoped to deploy most of my savings into the stock market to make them work harder for me, I didn't manage to find many investment opportunities. For FY2016, I merely added SingTel and ComfortDelGro. As a result, my cash is piling up in my bank account and I am forced to look for a second saving account as my cash holding has hit the bonus interest ceiling of OCBC360.

Expenditure wise, there were no significant change to my spending habit. Family contribution remain the largest outlay, followed by Dining and Entertainment. However, beginning April-17, another significant outlay in the form of income tax will start eating into my savings. I should probably start considering CPF top-up to lower my tax burden.

In FY2016, I also beefed up my insurance coverage. The newly introduced Mindef & MHA Group insurance, which replaced the SAF Group Insurance, offers term insurance at a very competitive rate. Specifically, I increased my death benefit by S$100k to S$250k and took additional critical and early-critical illness insurance with payout benefits of $100k each.

S$100k at Age 27


FY16 also marks the milestone of accumulating my first S$100k, 9 months earlier than my initial projection. My non-existential material wants contributed significantly to this accomplishment - I have no idea when was the last time I bought myself a shirt or a wallet. And despite the rise of ride-hailing services such as Uber or Grab that probably incentivized many to engage private hire cars due to its convenience, I remain loyal to bus and MRT which helped me keep my transport expenses low. Having said that, I don't live like a scrooge (though this is subjective), I do spend considerable amount on the occasional restaurant meals and overseas holiday.

I also try to take advantage of high interest accounts and credit card signup bonus/cash rebate to maximize my dollars. On top of my OCBC360 account which typically gave me 1.75-2.25% interest (note: interest has been revised down since Apr 2017), I recently opened a Citibank Maxigain Saving Account which peg its interest to 1-month Sibor. Various banks also offer credit card signup bonus which practically gives you money for free. For instance, Standard Chartered gives you $138 for simply signing their credit card. I have already collected my $138 from SC and have since terminated my card, hopefully I don't get blacklisted for it.

FY2017 Target


For the next FY, I will set a higher saving target of S$51,000. I also aim to expand my portfolio to generate an average of more than S$250 passive income per month. This should be more than sufficient to cover my transport expenses, insurance premiums, and phone bills. My next financial goal is to amass $250,000 by age 30.

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