National Service (NS)
Asked 3w ago
Hello there, I am a 20 year old waiting to enlist, have 10k in my savings account and plan to set aside at least half the amount of my pay a month for investing once I start NS. Paying myself wouldn't be an issue and extra expenses isn't an issue too and I've been really interested in starting the FIRE journey, but I have no idea how as there is a lot to take in, a lot to consider and learn. What actions/plans or even saving plans would you recommend me to start with before enlisting and during?
Hi, I'm 24 this year and I was at your situation too, perhaps I'll share with you what I'd do if I was 20.
Have 6 months of emergency fund (Eg: if you spend $400 a month, then make sure at least $2,400 remain in the bank account)
I'd take as much time as possible to learn investment. If you're interested in stock picking, then read some books or take some courses that teach you how to evaluate and pick stocks.
Remain invested while you're still learning. There are a few beginners friendly ways to start your investment journey
3.1 Regular Savings Plan - you can try with OCBC Blue Chips Plan, FSMOne RSP, POSB Invest Saver. I'd go with FSMOne due to their lower fee. This is a good way to start your investment journey with as little as $100 a month and continue to Dollar Cost Average
3.2 Robo-advisor - there are many robo-advisors in Singapore such as StashAway, Kristal.AI, EndowUs, MoneyOwl, Syfe etc. You can read online reviews and decide on your own. I'm personally using StashAway.
Once you have accumulated enough knowledge to get started, start picking stocks and invest in them. When you're young, I'd advise you to focus on growth stocks with smaller market capitalisation as they have a higher growth potential. After you accumulated sufficient capital from the growth stocks, you can diversify into more stable ones such as blue chips stocks, dividend stocks and REITs.
Focus on increasing your income, take on a side hustle, improve your skillset, start a small online business, whatever. Increasing income is the best way to accumulate capital.
All the best, stay safe, stay healthy and stay invested!
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I think this is an excellent article to start off with: https://blog.seedly.sg/fire-financial-independence-retire-early-in-singapore . knowing more about the principles of FIRE can't hurt.
Also, Endowus had quite an intriguing webinar discussion on FIRE this week: https://www.youtube.com/watch?v=-Sp6og70-qQ
hope this helps!
hi,i am currently 24,i started around 20 putting my money into regular saving plan,i have blog about it,dun forget to have an emergency fund of 6 month first:)
** [My POSB invest saver journey so far...](http://sonicericsg.blogspot.com/2018/05/post-21week-19investment-projectmy-posb_6.html) :**http://sonicericsg.blogspot.com/2018/05/post-21week-19investment-projectmy-posb_6.html
after that ,i have started with sg stocks ,stick to those stock that are blue chip
hope the above help!
You can consider working on your human capital first, there are a lot of great online courses out there. The more you are able to earn and get a good salary when you start work, the faster you will be able to hit FIRE.
Also, there is another webinar that Ruiming from wokesalaryman and I did, which talks about growing human capital as part of wealth accumulation:
Hope this helps!
Hello, its great to hear that you're starting so early! I only just came across the FIRE community and building wealth in general.
I personally find this blog really helpful. https://www.firepathlion.com/start-here/
Some things to note include
Map out how much you need to achieve FIRE. A good figure can be found in the blog.
Depending on what type of retirement you wish to have, work out around 25x your annual expenses. (Can be higher depending on when you intend to achieve FIRE)
The 4% safe withdrawal rate, taking into account inflation rate
If you intend to invest in dividend stocks, then basically annual dividends > annual expenses
You can take the time to read up during NS and by the end of 2 years you'll be financially woke. Some things you can do now are
Find out your cash flow and sticking to a budget during NS. You can automate everything using standing instruction to make it easier.
Opening SC Jumpstart account (2% pa on first 20k). Can consider POSB SAYE too but theres a 2 year lock-in period.
Half of your pay during bmt would amount to only around $300, you can consider investing using RSP and/or robos first.
Read finance related books, some of the ones I read include millionaire next door, random walk down wall street. If you're into stock picking, consider the intelligent investor. You can borrow them from nlb.
Continue reading seedly as theres many experienced contributors whom I'm learning from too!
All the best in your journey!
1 more comments
Libby.com and go borrow online as many personal finance / value investing ebooks to reading during your off-time/down-time during NS
It's not a good idea to get rich Young: https://en.wikipedia.org/wiki/27_Club
You'd better find a 'profession of passion', then money is boring to You.
all the things to avoid, to come back to your question, here:
take note that one of the most famous and successful (?) investors of modern times,
seems not to have been successful the trailing 10 years:
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Firstly, I will suggest for you to spend quality time to set well-defined goals in your life. With proper goals in place, it helps us to keep our productivity and discipline in check. For example, you may wish to accumulate $100k by the time you reach 30 years old.
Next, we need to have a complete understanding on our cashflow. Through this process, we will understand our earning ability and spending habit.
Here is a Guide:
Furthermore, brainstorm on methods to maximise your income and reduce expenditure on a consistent basis.
Thereafter, create a budget that is capable of helping you to plan for the future. The best way to do this is via automation.
How I do My Budget:
Now that we have created well-defined goals alongside with a clear understanding on your finances, invest your time into improve your knowledge in financial literacy. If you want to invest your money, then you need to have a basic understanding on the financial instruments and the risk that it bears.
Moreover, you need to establish whether you possess the knowledge, skills, experience, and time to manage your own investment portfolio.
On the other hand, some insurance companies partner with global investment firms like Mercer, and BlackRock to create an optimised portfolio for their clients to invest their money. Additionally, your agent should be capable enough to give you responsible advice on your asset management over time. This reduces the need for you to spend considerable time to manage the investment on your own.
Nevertheless, take the time that you have to understand more about yourself and what is available on the market to help you. When the need arise, speak to an experienced consultant who is able to mentor and guide you along the way. This increases the efficiency for you to get things done ahead of time.
I share quality content on estate planning and financial planning here.