OPC Calculations 26 November, 2009
Posted by dear1dear2 in Dear1, Dollars & Cents, Internet & Blog, Vroom Vroom.add a comment
Ok, I’m in a mathematical mood today so I’m going to test out the 
Let 
Let us consider the PARF of a normal plated car at each year within the lifespan of the COE of 10 years. For simplicity, we will consider integer number of years 
For an OPC, the 17000 rebate is deducted first from the COE, then from the OMV. Let us assume that 
Next, we substitute 
This equation shows us that if 
This means that OPC owners who got their COE at prices lower than 17000 do not enjoy the full 17000 rebate by virtue of the fact that they will receive a lesser amount when their car is scrapped. In the worse case scenario, the OPC owner will receive only 8500 in rebate if their COE is zero or near zero (i.e. $2 COE in Nov 08).
Of course, there are other factors to be considered such as the actual sale price of the car, the interest rate, amount of loan to take, length of loan, etc. This is only a very simplified calculation to find out the maximum and minimum rebates an OPC owner can get. Yes, in times of high COE, you get the maximum savings, but you might also end up paying more in absolute terms becos of the higher cost of the car and interest payable on loan amount. It’s like buying a brand-less backpack at full price of $20 or a designer brand backpack at 70% off the usual price of $1000. Sure, you saved $700 but you also just spent an extra (300-20=) $280 more than just getting the brand-less one.
Lastly, typing
-Dear1
Financial Plan(s) to acheive your Goal(s) 27 October, 2009
Posted by dear1dear2 in Dear2, Dollars & Cents, For Him For Her, Slice of Life.add a comment
Even before I had any proper knowledge in financial planning, it was already in our blood. Back in those days when Dear1 and Dear were together before our marriage, we had already started on planning our finances for our future. I remembered it was in our Uni days, probably a year or 2 into University, I started a second savings account. This account was purely for savings, for what exactly, I dunno at that point in time, but definitely it was an account to save for our future, ie our wedding, our house etc.
A few years later when the savings accumulated to $5,000, we decided to park it in a fixed deposit account so as to ‘make the money work harder for us’ at 0.75% compared to the 0.25% interest rate in those days. 1.5 years later, the FD matured but we still have no use for it, or rather it was not a ripe time for is to do anything yet, so we rolled the money for another 1.5 years.
After Dear1 proposed unexpectedly in 2005, it was pretty much still dating as usual for the then 1 year working Dear2 and Final Year Dear1, until one day when Dear2 spontaneously wiped out an empty sheet and paper and proclaim that ‘we must draw a timeline and cost to it.’ We thought about when we will get married, and buy a house, and the amount that we’ll need for the wedding, house downpayment, renovation, honeymoon etc. Some rough calculations and estimates, and some rough idea of what are the impending big ticket items, and our initially blank sheet of paper now tell us that a lot of money is needed ya. Nevermind that the figure is daunting, at least we now have a plan to work towards, and that we already have $5k ready to be deployed.
Along the way, we deflected from the original plan. Instead of having all the events at one go, we settled 1 event at a time – ROM, house, renovation, wedding, honeymoon in this order. Slowly and steadily with an income stream, plus our frugal lifestyle hinged on a systematic income and expenses control, we saw our goals falling into place 1 by 1, unknowingly.
Today as Dear1 and Dear2 are finally done with the important events of marriage, and are settling into a ‘no need to start our balance sheet from zero state’, we almost unconsciously forget to plan for our later future. Things are now getting quite dangerously comfortable for us (and how common is this the state of most people!!!). Marriage is not the only event in life, although it is one of the first few goals that most young people have to work towards. And upon the passing of that phase, there are still other important events or goals that we have to work towards, more commonly the planning for a comfortable lifestyle, now (together with baby(s)) and ongoing into our retirement.
Have you have a financial plan/ goal in place?
- Dear2
Confessions of a Spree-aholic 20 October, 2009
Posted by dear1dear2 in Baby, Dear2, Dollars & Cents, Shop till you drop.5 comments
OMG, I have turned into a spree-aholic in a matter of days!
It all started when Dear1 found a website where mtbs organise all sorts of sprees. And seeing how value-for-money shopping from such sprees can be, from the savings in (1) Shipping due to bulk purchases, and (2) These mtbs really can sniff out very good deals without you having to search for them yourself, haha. Dear2 spared no further delay in joining in the crowd. In a matter of seconds, Dear2 was fast on her way to opening a forum account all for the SPREE (haiz, Dear1 has been pestering the forum-idiot Dear2 to open an account, but Dear2 always feels that she will not participate in the all-nonsense forum for all-day-long crappy talk. Tell me about sprees and Dear2 can flip from NO to YES immediately… sigh.. wahahaha).
Yes, I want to buy this sweet pink 3-piece body suit pack from Old Navy. It’s just USD 10 for 3 pieces leh, a very cheap deal for sure!
Yes, this breast pump is surely worth it, normal retail price is over 1,000 and it’s going for less than half the price in the spree. Buy buy buy!!
Yes!! Birkenstock is having clearance sale now. I’ve always wanted a pair of Birkenstock shoes, but at $80 a pair, it’s always such a heartache. Now I can finally fulfill my dream at $42. Buy!
Oh my, this sweet pink dress is sooooooooooooo sweet. Even though I tell myself that I really have to quit this addiction, but…………… It’s soooooooo sweet! And it’s only slightly more than SGD 6! I want to buy!!
Within just 3 days, Dear2 was closely fixed to the computer screen, at home and in the office, all day long. The discounts were simply too irresistible – branded stuff at half the price (maybe), how to resist!? So day after day, Dear2 will check the bookmarked threads to see if her orders were confirmed, or if there’s new updates on the shipping status.
It has been exactly 1 week from the time since Dear2 started on spree-shopping, and also 1 week since Dear2 got addicted to this addiction. Fortunately for Dear2 (and Dear1 as well, haha), Dear2 finally stopped her addiction yesterday, when she saw that shipping costs may cost about the same, if not more than the actual price of the item. The SGD 14 capris pants may seem like a real bargain compared to the same pair from Marton Bell which cost $59 before the 20% closing down sale at the Vivocity branch, but there’s a likelihood that the shipping may cost an equivalent amount for its bulkiness and heaviness, and also that the shared box where all the other spreeists’ items were piled together was not optimised, then the total cost of SGD 30 may not seem such an attractive buy after all…
With that in mind, Dear2 is determine (almost) to stop spreeing until the ordered items are actually in my hands. But the lure of the spree forum is still so strong – I still constantly refresh the thread to see if there’s any new spree or discount coming along. It’s a every-minute-counts affair, cos usually when a new spree starts, it also closes almost immediately. The organiser may close the spree early if the required amount has been hit, or that she may only do 1 or 2 batch and if you happen to see the spree an afternoon too late, it just means that the boat is gone. And even if you do spot a good-deal spree, it’s every-minute-is-precious – gotto go to the website to browse through the discounted items, think about whether if the item really necessary, think about if that cost (not even factoring in shipping cost) is worth the buy, ask Dear1 if can buy or not, place orders with the organiser, transfer money to the organiser, seek confirmation on orders placed and money transferred, and then it’s finally checking the thread for latest updates to see if your order is placed successfully – all these have to be completed before the spree closes, or praying that the item is not out of stock…. The whole process is tenacious, even more exciting than stock-buying, cos when you buy stocks, you at least get to rest once markets close for lunch or for the day, but when it comes to spree-buying, every minute counts even until the wee hours at night, 24/7 all days.
Control.. Immune… Dear2 must really control herself and no more spreeing for now until the good(s) arrive…. But her hands are already itching to go check out new sprees now… Sob…
- Dear2
Saving our $1 coins 30 September, 2009
Posted by dear1dear2 in Dear1, Dollars & Cents, Slice of Life.2 comments
Since so long ago that I can’t even remember, I started a habit of saving my coins in those coin-saver piggy banks. Of course, mine is not a shape of a pig, rather it is a traditional red mailbox. Now, how did this habit start?
It was around the time when I got my first wallet. As many of us know, if there are coins in the wallet, it makes the entire wallet big and bulky, not to mention heavy too. So what I did was, at the end of each day, I would empty my wallet of coins and just left them lying on my study table. Before long, my study table was overwhelmed by coins. That was when I decided to bring out one of my unused piggy banks and started depositing all these coins into it.
Some time down the road, I found it quite satisfying to hear ‘clinggg’ of new coins falling upon the old ones already in the piggy mailbox. However, I also began to thirst for more! I wanted to grow my piggy mailbox quicker so that I can open it up and start counting my coins like Scourge Mcduck. So I made a new personal policy, that all coins will not be spent but will be deposited once it entered my wallet. This really made a lot of difference as my piggy mailbox grew by leaps and bounds. But my spending power took a big hit. Imagine, I paid for a $0.30 packet of titbits using a $2 note and received $1.70 worth of coins in return. Following my strict policy, I had to save all the $1.70 worth of coins, meaning I had very much less pocket money to spend. :(
Soon, my piggy mailbox was full and it was time to count the fruits of my labour. I remember sorting out the coins by type first, the 1c, 5c, 10c, 20c, 50c and 100c (aka $1 gold coin). I vaguely recall that the 10c and 20c were the greatest in numbers but they were worth very little in total value. Instead, the $1 coins contributed to the majority of the value of my first full piggy mailbox despite it being the least in numbers. (Okok, the 5c coins were the *least* in numbers, the $1 coins were 2nd last. :P)
From there on, I made a change in policy. Only $1 coins will not be spent and must be deposited; all other coins can be spent. This is because $1 coins are the highest valued coins in Singapore and hence a pure $1 saving piggy mailbox will yield the highest value per volume.
That was years ago. I’ve since emptied my piggy mailbox of my pure $1 savings several times and easily recovered around $500 each time. It really makes me feel like Scourge Mcduck counting my stacks and stacks of gold coins (Singapore $1 coins are indeed gold in colour).
Some time along the way, I managed to influence Dear2 into subscribing to my $1 coin policy, and she did. But Dear2 plays cheat sometimes as she would occasionally throw in some 50c coins in order to make her piggy UFO grow faster so that she can empty it earlier. And because Dear2’s piggy UFO is transparent, I can often spot the odd silver colour 50c coins within and ‘punish’ Dear2 for violating the rules. Gee… Under my close supervision, Dear2 has turned over a new leaf and plays by the rules now. Gee…
Since moving in together, we have joined our efforts in saving $1 coins into my piggy mailbox. With our combined contribution, the piggy mailbox is growing faster than ever. It is really music to our ears to hear the silence of the falling coin getting shorter and shorter. It means that our coin-level is getting higher and higher. :D
Besides counting coins and satisfying our coin-music ego, the $1 coins came in useful for one other occasion, our wedding. We selected the brightest and shiniest of our gold coins and packed them into a hefty $88 Gold Angbao for our wedding. So auspicious, $88 (fa-fa), gold colour, bright and shiny. Yeah…
We’re not young children anymore, so you may ask, why are we still putting money to a piggy bank? Well, it’s a matter of discipline and character. Saving these coins is not about its monetary value. It is about cultivating a discipline lifestyle, teaching us perseverance and training ourselves to be responsible adults. The small gesture of our daily coin drop may well be a building block for us to face larger problems in life.
-Dear1
The NTUC Shopping Experience 10 September, 2009
Posted by dear1dear2 in Dear2, Dollars & Cents.add a comment
Dear1 and Dear2 participated in the Passion Run in 2007 and with it signed up for the Passion Card at the same time. As a discount card, the Passion Card has help us to accumulate some points (aka linkpoints) from Best Denki, Bangawan Solo, Angie’s the Choice and most commonly, NTUC. Let’s talk about how we use this card in our daily grocery shopping.
First of all, card holders must know that the Card is only able to gain points from NTUC if there is more than $20 spending in a single day, no need a single receipt, and the Card must be presented at times when you made purchases of course. Dear1 and Dear2 din know about this at first, until we asked the nice counter aunties who explained these hidden terms to us. The points are awarded 1 point for every dollar spent, and sometimes participating stores like the above mentioned will give extra points, as with NTUC recently which is giving 2 times the points apparently. Opps, before I forget, Dear1 says that the so familiar supermarket known as NTUC is not actually NTUC, but the proper name is Fairprice. Keke, we’re so used to calling it NTUC since young, it already has a nostalgic feel to it. so it shall remain as such. Haha.
The second step will be to make sure that we purchase at least $20 worth of grocery at every purchase. Being conscious spenders, Dear1 and Dear2 will always do a price count of the items that we wanted to get, and if there’s a shortfall to that $20, top it up with other non-essential items like snacks and tidbits. There’s a fair bit of work to do during this grocery marketing, first of course is to do addition on the prices, and being pretty good with maths, this was without much effort for Dear1 and Dear2 (although Dear2 usually wins in terms of speed, keke). For the less maths-savvy, simply whip out your handphone calculator (that’s what Dear1 does sometimes, keke).
Secondly, we always buy discount only items. Ah, there’s a discount on Ayam brand baked beans, let’s get 2 cans. Ah, this brand of hotdog is on sale, let’s get a packet. Yes, this NTUC brand tissue box on offer still holds more number of tissues than that one not on offer, let’s get it. Haha, Dove shampoo and conditioner is $9.50 again, gotto get it. Oh yeah, the Top low surds washing powder is finally on sale, quickly stock up now. The trick here is, getting an item not when you most need it, but when it’s almost running out. That requires some advance planning and forward looking. (But having said that, Dear2 has heard of some people who will literally stock up their house with A LOT of these household essentials IN BULK when they are on sale. Just make sure that once stowed away in the storeroom, they will still be remembered and not be left to expire.) For that calculated spending, Dear1 and Dear2 are able to achieve at least 10% worth of discounts on each of our NTUC trips, discounts not including the normal price vegetables and fruits and other must-get-but-got-no-discount items.
With a little effort every time, the linkpoints accumulated is able to redeem 1 time free grocery shopping every year, ie, about $20 worth of rebates. Just make sure that the points are exchanged before 30 Jun as that’s when they will expire.
- Dear2
First Born Incentive 1 September, 2009
Posted by dear1dear2 in Baby, Dear1, Dollars & Cents.1 comment so far
We recently sign up for the First Born Incentive (FBI) programme from Thomson Medical Centre (TMC). However, there is a subscription fee of $148 for a 2 year membership. So the big question here is, is it worth it?
First off, let’s talk about the membership duration. The membership is valid for 2 years. Most MTBs sign up for the card at 12 weeks, which means that the card will be valid for (52 x 2) – (40 – 12) = 104 – 28 = 76 weeks after childbirth. This is good becos there are a few discounts that can be use after the baby is born, such as 10% paediatric professional fees, 20% postnatal home visits, 10% retail pharmacy, etc. There are also other advantages of this 2 year membership which I shall not elaborate.
There is also a goodie bag when we signed up for the package. This includes a diaper bag, 3 books published by TMC, a sample tin of Similac for mum, and a variety of other small goodies like socks, diapers, changing mat, bibs, music CD, etc. It’s difficult to put a value to these goodies becos some of them are samples while others are retail items. For simplicity, let’s be conservative and assume the value of the goodie bag to be $20.
The next immediate savings that can be enjoyed is the P6 package which includes the OSCAR scan @ 12 week and the FA scan @ 20 week. Although it is not a must to go for the OSCAR scan, but it is still highly recommended by most gynaes. What most ppl do (including us) is to apply for the FBI programme at the information counter at level 1, then use the receipt as a temporary membership card and immediately enjoy a 10% off the P6 package at level 4 X-Ray and Ultrasound department. P6 cost $409, so our savings is ~$40.
Next is the 5% off maternity professional fee. This is basically the baby delivery fee of the gynae, not the regular consultation fee. First, we need to check to make sure that the gynae we’re seeing is from the list of gynaes participating in the FBI programme becos the discount is only applicable to participating gynaes. Luckily, ours is. However, the delivery fee is a very uncertain amount as it depends on how complicated the procedure is, whether epidural is used, whether forceps is used, etc. So again, let’s make a conservative estimate that we’ll save $20 for this part of the discount.
The last large necessary discount is for the hospital stay after the baby is born. It is $100 off for single room, $80 off for 2-bedded rooms and $60 off for 4-bedded rooms, applicable to TMC only. Hmm… We heard from the nurses that at TMC, it is very common for 4-bedded rooms to be upgraded to 2-bedded rooms for free, becos they have very little 4-bedded rooms at TMC, so that’s an incentive for taking up the 4-bedded room package. We haven’t decided on this yet, so let’s be conservative again and assume that we’ll take up the 4-bedded package and save $60.
There is also an optional item from which we could make use of the FBI card. That is to sign up for the childbirth course at ParentCraft which is part of the hospital services at TMC. This course is popular and suitable for first time parents-to-be like us to learn from the experts about the various aspects of infant care. We dun have the exact figures right now but the 6-session course is around $190 after 10% discount for weekends (cheaper for weekdays). Let’s make an intelligent guess that the discount is worth $20.
Sidetrack a bit, there’s also a 10% at the delifrance cafe at TMC level 1, applicable to this branch only.
Ok, it’s time to summarize. The cost of the FBI membership is $148. The essential savings at $20 of goodie bag, $40 off OSCAR + FA scan, $20 off gynae fee and $60 off 4-bedded room @ TMC, for a total of $140. Oh no, the savings is not worth the membership fee, it’s $8 short. There are a few ways we can make the FBI more worth while. First, we can stay in better rooms to get more discounts. Or, we can sign up for the ParentCraft childbirth course for additional $20 discount. Or, there’s a 20% postnatal home visit discount, or the 15% health screening packages for parents and grandparents.
So anyway, the bottom line is, going by our conservative estimates, the total essential savings fell a little short or just barely breaking even. However, if we intend to spend a bit more on other services, then the FBI membership is definitely worth it. In any case, it is still a worthy get for any expecting parents who are delivering at TMC.
-Dear1
Pregnancy related expenses 27 August, 2009
Posted by dear1dear2 in Baby, Dear1, Dollars & Cents.add a comment
Over the past weeks, we’ve come to realize that there are a lot of different costs related to pregnancy, such as doctor consultations, scans, vitamins, supplements, maternity wear, childbirth related courses, baby clothes, bottles, etc. And this is going to be an ongoing thing. So we’ve decided to dedicate 1 post to track all our expenses over the 9 months of pregnancy. This post will continually be updated as and when the expenses are incurred. Hopefully, this will give us a good guideline as to how much we need to save and prepare for this and also subsequent child. Of course, our readers can also benefit from this and plan their finances ahead.
- Singapore Women’s Clinic – $174 – 1st visit tends to be more expensive, folic acid, supplements
- Singapore Women’s Clinic – $157 – 2nd visit, folic acid, supplements
- Healthline – $24 – Dear2 fell sick (cough) due to weaker immune system during pregnancy
- Healthline – $15 – Dear2 hasn’t recovered
- Triumph – $6.90 – 1 bra extender
- ACJ Clinic – $154.08 – we decided to switch gynae, 1st visit more expensive, no medicine
- Thomson Medical Centre – $148 – First Born Incentive program (FBI)
- Thomson Medical Centre – $393.85 (10% off FBI) – P6 (OSCAR + FA scan)
- ACJ Clinic – $798.01 – 2nd visit, antenatal package (includes consultation, ultrasound & urine test, excludes medicines), multi-vit
- Healthline – $22 – Dear2 fell sick again (running nose)
- ACJ Clinic – Free! – 3rd visit, no medicine
- Thomson Medical Centre – $47.30 (1-for-1) – 2 bottles Galenic stretch marks cream
- Online shopping – $75.55 – 2 maternity dresses
- Online shopping – $67.80 – 1 nursing top, 1 maternity pants
- ACJ Clinic – $88.06 – 4th visit, multi-vit, fish oil, Gaviscon Advance
- ParentCraft – $192.60 (10% off FBI) – Childbirth course
- Thomson Medical Centre – $94.60 (1-for-1) – 4 bottles Galenic stretch marks cream
- ACJ Clinic – $8.35 – 5th visit, multi-vit
- Pasar malam – $1 – 1 bra extender
- Marton Bell – $42.40 – 1 short pants
- ACJ Clinic – $50.08 – 6th visit, multi-vit, iron pills, fish oil
- Medela Spree – $480 – 1 Freestyle breastpump
- Gymboree Spree – $15.55 – 2 baby shirts
- Old Navy Spree – $37.11 – 1 maternity pants, 3 baby bodysuits
- Aussino – $53.35 – 1 comforter set (free 1 bib), 1 bath towel set, 1 bath face towel set
- Mothercare – $24.65 – 1 toy animal giraffe
- The Children Place Spree – $7.23 – 1 baby dress
- Old Navy Spree – $22.85 – 1 baby bodysuit, 2 baby pants
- Aussino – $9.95 – 1 jersey blanket
- Mums & Babes – $6.90 (after trade-in) – 1 Medela bottle
- Taime warehouse sale – $353.26 – 1 abc mat, 2 123 mat, 1 stroller fan, 1 rubber cot sheet, 1 swaddleme, 1 baby nail care set, 1 Capella S705-RED09
- Carrefour – $25.55 – 1 500ml thermal flask
- Aussino – $49.90 – 1 comforter set (free 1 bib), 1 jersey blanket
- Shen Kwong Trading – $21 – 6 baby shirts, 6 long towels, 12 face towels
- Metro – $284 – 1 cot (free 1 mattress, 1 activity mat, 1 bean sprout pillow), 1 Pigeon Rapid Steam Sterilizer
- Daiso – $2 – 2 stroller handle hooks
- Toyogo warehouse – $55 – 1 704-5 drawer
- Gymboree Spree – $12 – 2 baby bodysuits
- Baby Kingdom – $32.06 – 2 boxes baby washing detergent, 1 box nursing pad, 1 pacifier
- Total so far – $4052.94
to be updated…
-Dear1
Manhattan Card – Our favourite credit card 9 August, 2009
Posted by dear1dear2 in Dear1, Dollars & Cents.1 comment so far
Credit cards are no doubt very useful, convenient, and even a money saver if you are someone who is prudent with spendings and remembers to pay up your credit card bills in full every month. Credit cards bring up front discount at many shops and restaurants that can really let you stretch your every dollar. Dear2 has also talked about credit cards before, read here and here.
Other than up front discounts, credit card companies also came up with the idea of loyalty rewards where you earn reward points that can be converted into vouchers or electrical appliances. However, a disadvantage of this system is that you are limited to the products that the credit card company offers, and very often the products are overpriced and not all that useful. So for this scheme, exchanging points with shopping vouchers (Taka, Metro, OG, etc) is the most sensible choice as it is as close to cash as you can get. The constrains are still there, you can only spend at that particular shopping mall. Not to mention most points come with an expiry date, so you need to remember to exchange your reward points from time to time. Typically, the returns on such point systems is around 0.5% or less.
Next came the era of “Do you wish to redeem?”. If you ever had a DBS CapitaCard or a POSB Everyday card, you will know what I mean. With these cards came a different rewards system, the cash rebate system. That is, you earn a special kind of cash rebate that is stored in your credit card. For example, if you spend $100 at NUH (National University Hospital) using the POSB Everyday card, you will receive Daily$0.30 (min 0.3% rebate at non-participating merchants), which can be redeemed as cash value at a later purchase at any *participating* stores. This is quite a big improvement becos our loyalty rewards are even closer to cash than before. If the range of participating stores are large enough, then you can earn rebates at SPC (Singapore Petroleum Company) and later spend it at, say Watsons. Things are getting better.
The next big thing was cashback schemes. Yes, that means you receive cold hard cash back from the credit card companies. This is by far the best and most flexible rewards program. For example, Citi Dividend card give a min 0.5% cashback on all spendings and up to 5% cashback on petrol. The cash will be credited into the credit card account at a later date which can then be used to pay for the next month’s credit card bill. Fantastic! But there’s a small catch. Citi Dividend card will only pay out the cashback when you accumulated a min of $50. So that means that if you only spend at petrol kiosks, you need to spend $1000 worth of petrol before receiving the min $50 cashback. Or even worse, if you only spend at other merchants, you need to spend $10000 worth of products & services before receive the min $50 cashback. Ouch!
And this brings me to my main topic. The Manhattan Card from Standard Chartered Bank. Their loyalty scheme is that of the cashback system. The cashback structure is as follows. Everything is based upon spendings per month.
- $0-500 = 0.5%
- $501-1500 = 1%
- $1501-3000 = 2%
- $3001 & more = 5%
Cashback will be paid out quarterly with no min payout requirement, but subjected to a max payout of $300 each quarter. There is no cumbersome list of partner merchants. I think this is an elegant system to employ and the payouts are also fantastic. I’ll illustrate this with our 2 major expense recently – Japan Honeymoon and Kia Forte. With our holiday, we signed for $3636.40 (air ticket and hotel bookings) and received $181.82 returned in cash. With our car, we signed for $3999 (initial deposit) and received $199.95 returned in cash. The cashback is returned as credit in our credit card account and can be used to pay for the next credit card bill. In my opinion, this is as good as real cash.
This is the reason why the Manhattan Card is our favourite credit card and also our ‘everyday’ card in the sense that we will use this credit card to pay to anything without an up front discount. Always ask for up front discounts first becos paying less is better than paying first and getting back later. Moreover, up front discounts are typically more than 5%. Let me illustrate our choice of payment methods.
- Ask for up front discount with credit cards.
- IF we have that card, THEN pay using that card, ELSE pay using Manhattan Card.
Using credit cards really can help to save quite a bit on a monthly basis. But only if you meticulously exploit the system and also remember not to spend beyond your means and to pay up in full every month.
-Dear1
Side note: While I’m really thankful that we’re able to reap benefits from credit cards, I’m also a bit sad that people who dun qualify for credit cards (i.e. people with low income, and that includes our parents) are those that need those additional savings. It seems to me that the higher incomers save more while the lower incomers pay more. Quite ironic.
Japan trip expenses 8 August, 2009
Posted by dear1dear2 in Dear1, Dollars & Cents, Nihon no koto.1 comment so far
Ok, I’m going to talk about Japan (yet again). Haha… Yes, I know I know, I’ve been writing alot of Japan. But that’s only becos we really did enjoy Japan that much. :D Ok, let’s get down to my motivations for writing this post. There are 2. First, to document our lives and also to provide a guideline for others who wish to make an estimate of how much a Japan F&E holiday costs for budgeting purposes. Second, to illustrate the importance of using credit cards to pay for big ticket items. Point 2 about credit cards will be covered in a subsequent post. Let’s begin.
Broadly, there are 2 time frames where we need to make payments. Before the trip, and during the trip. The difference being that, Singapore dollars is most likely to be used before the trip while the foreign currency, in this case Japanese yen, is to used during the trip. For payment in SGD, it is advisable to pay by credit card to earn reward points and cash rebates. For overseas spending, my take is that there are some uncertainty involved in exchange rates and it only makes sense to use a credit card if u r able to achieve savings in point & cash rebates greater than the best money exchange rate available (for example in Chinatown or Mustafa). For us, we were able to get good exchange rates from a Singaporean friend who is working in Japan so we pay everything in cash during the trip. For reference, we’ll be using 1 SGD = 62 JPY. Amounts quote are total spendings for two. Format is item – amount – payment method.
Before the trip
- Northwest Airlines tickets – SGD 1462 – Manhattan Card
- Sunroute Plaza Shinjuku (6 nights) – SGD 1184.21 – Manhattan Card
- Ichinoyu Honkan (1 night) – SGD 312.19 – Manhattan Card
- JR East Pass (4 day flexi) – SGD 678 – Manhattan Card
Total: SGD 3636.40
During the trip
- Food – JPY 70721 (SGD 1140.66) – Cash
- Transport – JPY 35830 (SGD 577.90) – Cash
- Hotel (4 nights) – JPY 34320 (SGD 553.55) – Cash
- Attractions – JPY 25000 (SGD 403.23) – Cash
- Shopping – JPY 32667 (SGD 526.89) – Cash
Total: SGD 3202.23
So, in total we spent SGD 6838.63. But in fact, our actual expense is less than that, becos we were able to get 5% cashback (SGD 181.82) from using our Manhattan Card. We received the cashback 1 month after we returned. This meant that our actual amount spent after deducting cashback is (3636.40 – 181.82 + 3202.23) = SGD 6656.81 (everything included) for two for 12 days in Japan. :D
-Dear1
Joint Account for saving purposes 26 July, 2009
Posted by dear1dear2 in Around the House, Dear1, Dollars & Cents.add a comment
Let me start with a bit of background information to motivate the need for a joint account dedicated to the purpose of savings.
Some time back, when we were just starting our family, we started to feel the extra burden of having to pay household bills. Yes, those invisible blood sucking creatures that drain ur finances without you even realizing. Read more here. We didn’t notice the impact of these monthly expenses when we were young becos we’re living under the protective wings of our doting parents. It’s a bit different now that we’re living on our own…
To make accounting more systematic and transparent, we started a joint account for the purpose of keeping track of all these expenses. This account is termed as a joint expense account. But therein lies the problem. It’s an expense account. Meaning that, we draw our food and grocery expenses from there, pay our household bills from there, pay our credit card bills from there, buy investments from there, service car loan, etc.
The big problem with this is, how much are we actually saving on a month to month basis? It is difficult to answer such a question using solely our expense account which has a constant cashflow.
The solution, we needed to open another joint account, dedicated to the purpose of saving. Saving money is both a good habit and also necessary, just read any personal financial guide.
There is actually another motivation for opening this new joint account. That is, with the recent economic turmoil and uncertainty, with big name companies such as Lehman Bros collapsing, we wanted to be on the cautious side of things. And knowing that it is under MAS policy that each deposit-type account in Singapore is insured for up to 20k per account (I think it’s called the Deposit Insurance Scheme), we decided that we needed to diversify our bank deposits and not keep everything in one basket. Yes, not just investments, bank deposits need diversification too.
And so, after a lazy effort of searching for the best yielding deposit account, we decided on the Citibank Step Up account. It’s the second bank we surveyed, the first being HSBC. The attractiveness of this deposit account is that it increases your interest rate for every month that your balance is higher than the previous month. Actually, it’s more complicated than that, please read more details from the Citibank website. So, the basic idea is, if your minimum account balance is consecutively highly than the previous month for 12 months, you will receive the maximum possible interest rate of 0.75% pa (as of 26 Jul 09). And once you have accumulated the maximum 12 ‘Step-ups’, you just need to maintain a minimum of 20k in that account to continue enjoying the maximum interest rate. For comparison, DBS Savings Plus account gives 0.25% pa for balance above 50k (as of 26 Jul 09).
This suits us perfectly. Since what we wanted was a joint account for the purpose of saving money, that meant that from our perspective, we will only deposit money in and will not withdraw any money out (except for really really rainy day situations). So, we’re all set to receive the maximum interest rate after 12 months if we make a disciplined monthly contribution to this account. Thereafter, we can top up the amount to 20k at the end of 12 months to continue enjoying the benefits. And since it is insured up to 20k, we’ll withdraw any excess (0.75% of 20k = 150 per annum) and put it into another deposit account with another bank. This way, no worries about bank failures.
So that’s our plan. And it was put into action since Oct 2008; that’s about 8 months ago. Yeah! Since we started, we have been very disciplined and contributing monthly to this account. In addition, we also deposit all our government gifts (Growth Dividend, GST Offset Package, etc) and our stock dividends into this account to make it grow faster.
Now, it is about time we start sourcing for another savings account. We’re currently quite keen on the OCBC Monthly Saving Account. The currently promotion is 1.08% pa with a monthly contribution of 800 for 24 months, which works out to be 19200 in principal amount, just shy of the 20k insured mark. Looks promising.
-Dear1
