As I progressed in my career, the
probability of financial independence becomes more certain. Admittedly I became over
confident that my decisions on spending are right; up to a point along the way
it became ostentatious and losing myself. Buying branded goods, driving luxury
cars, watches, hotel membership on dining, 6 travelling trips a year (just to
maximise the free 24 priority pass lounge visits – every trip I can utilise 4,
2 in SG, 2 overseas) became a way of life.
This is no good. This is not me.
Where did the initial child like ambition of early retirement and simple
life disappear?
Slowly, I started to declutter goods that I bought for the purpose of _____.
As I struggled to fill in the blanks, phrases like “showing I can afford”, “keeping
my image”, “keeping up with my peers” appeared at first instance.
Quite retarded reasons.
Fortunately, I have managed to declutter some. 2 years ago, I signed up
for the AIA vitality and discovered that by wearing a fitness watch, I am able
to earn $10 grocery vouchers weekly, discounted movie tickets monthly and
yearly $150 cash rebate. The perks are more than sufficient for me to wear any other
watches that do not pay me weekly cash!
3 years ago, I was at the cross road to change my vehicle. It was
extremely tempting. Back then, I was driving a 2.5L luxury car and finances
allowed me to continue driving one. It didn’t help when peers were changing to
nicer rides. I test drove Jaguar, Mercedes, BMW, Lexus, Infiniti. Porsche was
very close on my list as well. After all, a colleague who was earning lesser
than me could buy one as well. I can stretch my budget to 20k a year
depreciation cost right?
Fortunately, good sense prevailed. I evaluated the decision
economically. I only wanted a car slightly better ( in terms of size, design,
performance) than a bread and butter (point A to B) car like Toyota Altis or
Honda City with slightly higher depreciation cost.
I
managed to buy a 1.6L humble continental ride that comes with only 6 speed gear
box, all around sensors, memory seats, 4 doors (keyless entry), leather seats,
Apple car play, reverse camera, 18 inch sport rims and free 1 year insurance cap
at 1.5k. The dealer also provided 5 years warranty and servicing further
reducing my cost of ownership till 2022.
The
depreciation on straight line basis worked out to be $10k/year, cheaper than a
camry of around $12k/year then.
So far
it has not given me any problems other than being a “laughing stock” amongst my
peers.
“Car
already so expensive in Singapore, it is stupid to buy an expensive one and not
enjoy it!”
“No
resale value one!”
“Kiam
kanna!”
These
are some of the remarks made by peers. Living with it saved me at least $5k a
year. I think I can live with it.
My main
cost of living is housing, transport, travel and food. For housing, as my
property is in the money, in a way I am living for free. This is because I am
able to cash out upon sale of my property and all payments made for the house
from day 1 will be paid back to me. I can subsequently invest the money to
generate an income to compensate rent or simply buy another HDB and fully pay
off with my CPF balance.
I am actually
contemplating to sell my house for a resale HDB in order to live even more
simply. Of course more objections from people around me living in landed and
condos:
“What
for? Save the money and not spend it belongs to the bank!”
“I have not seen anyone getting rich buying a
resale HDB.”
It may not happen eventually, as I am comfortable at my place right now.
Although I
rarely use the gym, pool and have never booked the common facilities.
The things I
like (and not available in a new resale HDBs) are sheltered underground
parking, kitchen built-in rubbish chute, nice lifts with aircon lobby, balcony
(for plants and clothes drying) and my low entry purchase price (on hindsight).
Moreover, the monthly maintenance of $300 is about $150 more than a comparable
HDB (after accounting for parking). I will probably end up spending $150 on
gym/pool facilities if I live in HDB hence the savings are insignificant.
For
food I am spending approximately $1.5k a month on it. This works out to be $50/day.
I do know that by picking up the skill of cooking I am able to keep food
expense to $500 a month. It is something I would definitely explore as I move
towards early retirement. However at the moment, I still quite enjoy the daily restaurants
dining.
In
fact, I do try to dine at odd hours where possible where there are 1 for 1
deals in town and neighborhood areas. Some credit cards also allow 50% off
dining which fits my budget and taste buds comfortably.
Some random
rants! I think I need to blog more or I will just have endless to say in 1
post!
