I am a 20 year old waiting to enlist, how do I start the FIRE journey? - Seedly
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Anonymous

Asked 3w ago

I am a 20 year old waiting to enlist, how do I start the FIRE journey?

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?

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Zi Shuen
Zi Shuen
Level 4. Prodigy
Answered 3w ago

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.

  1. 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)

  2. 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.

  3. 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.

  1. 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.

  2. 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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Question Poster

3w ago

My apologies for that, Zi Shuen, I was confused... My bad. I'm stuck between Stashaway, Digiportfolio, syfe and Kristal.Al. All 4 are good and I'm really stuck on which I should go for. Really want to try Kristal.AI since there is no management fee if I start low but was just wondering whether its a solution longer term!
Zi Shuen
Zi Shuen

3w ago

Question Poster, Kristal.AI is a good place to start for sure! They have no fee, and you can also customize your own ETF instead of having a custom-built portfolio like you such as StashAway. However, take note that going for Kristal.AI is a little bit your own 'stock picking' as you can choose your own ETFs that you like, that itself has no difference as your normal brokerage account, just no fee. So, if you want a passively managed portfolio that's customized for your own risk tolerance, needs and time horizon, then go for StashAway. To summarize, if there are any particular ETF that you really like and would to own it, use Kristal.AI. If you want a portfolio that's custom-built for you, use StashAway. I can't speak much for Digiportfolio and Syfe as I have not used them personally, hence I would suggest you to look for online reviews for those. But yes the 4 you mentioned all have good reviews, so I am sure it won't go wrong going with any of them, or heck, use all of them HAHAHA. Cheers!
Heng Kai Le
Heng Kai Le, Mondomover at School Of Life
Level 6. Master
Answered 3w ago

Hi there!

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!

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Question Poster

3w ago

Hey, thank you, I will take a look at it!
Ericsson Ting
Ericsson Ting
Level 4. Prodigy
Answered 2w ago

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

Posb invest saver and why i choose Posb invest saver** **:http://sonicericsg.blogspot.com/2018/05/post-23week-20investment-projectposb.html

after that ,i have started with sg stocks ,stick to those stock that are blue chip

How to purchase a stock?(DBS vickers) :http://sonicericsg.blogspot.com/2018/12/post-63week-50learning-investingtrading.html

hope the above help!​​​

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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:

https://endowus.com/insights/webinar-fuss-free-investing-for-beginners/

Hope this helps!

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Matthew Tan
Matthew Tan, Incoming Undergraduate at NTU
Level 5. Genius
Answered 3w ago

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

  1. Map out how much you need to achieve FIRE. A good figure can be found in the blog.

  2. 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)

  3. The 4% safe withdrawal rate, taking into account inflation rate

  4. 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

  1. Find out your cash flow and sticking to a budget during NS. You can automate everything using standing instruction to make it easier.

  2. Opening SC Jumpstart account (2% pa on first 20k). Can consider POSB SAYE too but theres a 2 year lock-in period.

  3. Half of your pay during bmt would amount to only around $300, you can consider investing using RSP and/or robos first.

  4. 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.

  5. Continue reading seedly as theres many experienced contributors whom I'm learning from too!

All the best in your journey!

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Matthew Tan
Matthew Tan

3w ago

A standing instruction is basically setting up an instruction to transfer an amount to another bank account. For eg im setting a standing instruction to transfer $XX amount on the 10th of each month from my DBS account to the jumpstart account. (10th because NS salary is credited on that date) This makes the habit of saving easier and the balance you see on your DBS account is what you have left to spend.
Matthew Tan
Matthew Tan

3w ago

I cant comment on digiportfolio as I personally do not use it. Do note that there is a minimum amount and the fees are higher compared to other robos too. Take a look at the review page on Seedly to see what others have to say!
Wilson Nid A Break
Wilson Nid A Break
Level 8. Wizard
Answered 3w ago

Libby.com and go borrow online as many personal finance / value investing ebooks to reading during your off-time/down-time during NS

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Question Poster

3w ago

Thank you, I will!
Frankie Aufhauser-Rappaport
Frankie Aufhauser-Rappaport
Top Contributor

Top Contributor (May)

Level 9. God of Wisdom
Updated 3w ago

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:

https://seedly.sg/questions/what-is-your-general-investing-philosophy-strategy

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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Frankie Aufhauser-Rappaport
Frankie Aufhauser-Rappaport

3w ago

Superb!
Frankie Aufhauser-Rappaport
Frankie Aufhauser-Rappaport

3w ago

Don't listen to most finance professionals (sorry...) and apply critical thinking as much as You can. always request / apply a benchmark (and an appropriate one, lots of tricks out there ...) when you want to find out about the performance of finance products recommended to You or that of Your DIY investments (averaged annual aggregate performance is what counts).

Goal

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.

Cash Flow

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:

Understanding Your Personal Cash Flow

Furthermore, brainstorm on methods to maximise your income and reduce expenditure on a consistent basis.

Budget

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:

How to create a Monthly Budget

Knowledge

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.

More Details:

Types of Investment Risk that You should know

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.

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Question Poster

3w ago

Hey, thank you for the advice! I will properly get go know my financial situation, plan for it, get more knowledge but meanwhile, is it feasible to start a posb digiportfolio account?