Singapore-based financial blog that aims to educate people on personal finance, investments, retirement and their Central Provident Fund (CPF) matters.
Reaching your retirement tough, especially with inflation, low-interest rates and longevity.
The amount that we are saving might not be sufficient for us to retire at the age we feel we should be retiring.
Assuming you make the income as per below.
Assuming you save 20% of your monthly income, and there is no inflation.
Age
Monthly Income
Annual Savings
20 - 24
$2,000
$4,800
25 - 39
$2,500
$6,000
30 - 34
$3,000
$7,200
35 - 39
$3,500
$8,400
40 - 44
$4,000
$9,600
45 - 49
$4,500
$10,800
50 - 54
$5,000
$12,000
55 - 59
$5,500
$13,200
60 - 64
$6,000
$14,400
When you reached age 65, you would have saved $216,000 in total.
Below is the retirement income you can get depending on how long you think you can live.
Live Till
Retirement Years
Monthly Income
95
30
$1,200
90
25
$1,440
85
20
$1,800
80
15
$2,400
75
10
$3,600
70
5
$7,200
Base on the above 2 tables, we can tell that the longer you live in your retirement, the less you get monthly from your retirement fund.
Retirement is going to get tougher as we live longer unless we push it back to after age 65.
Currently, if we start working at age 20, retire at 65 and live till 90, we are using 45 years of work to support 25 years of retirement; that's nearly equivalent to using half your monthly salary to support 1 month of your retirement, which technically, is fairly insufficient.
Several facts below:
1) On average, 1 year is added to your estimated lifespan every 10 years.
2) People used to live till 60+ 70, so retiring at 55 would still get you a fairly good monthly retirement income (35 years of work to support 15 years of retirement).
3) Retirement is going to get tougher as you live longer unless you work longer.
Sadly, most people will never have a scenario where there is no inflation.
Most people will see inflation being higher than the interest they can receive, which erodes away their money's value.
*Above assumes a saving rate of 20%, which is the amount Singaporeans technically "save" via a compulsory retirement scheme call Central Provident Fund (CPF).
Just a little heads up, if you are unable to grow your retirement savings at a rate faster than inflation, chances are, you are going to have to work past your retirement age to ensure you do not face any retirement income shortfall.
Remember to offer your opinions. If you don't put your two cents in, how can you expect to get change? Have feedback? Tell us now! Subscribe to us or
Follow us: Investment Stab on Facebook
Everyone has a goal of retiring comfortably after working more than half their lives out for money.
We all hope to get a lump sum retirement fund when we reach our retirement age.
But, in Singapore, our money is instead secured away and we are given a monthly income from that pool of money.
Although we still think the CPF is a pretty solid retirement scheme, not everyone agrees to this.
So if you think you are better off with the full sum of CPF money in your pocket, we will be sharing how you can get that pool of money out of your CPF!
There are 2 ways to do this:
1) Buy a Life Annuity Plan
We talked about what an annuity plan is and how it can help you withdraw your retirement sum from the CPF.
You can find the post here:How to Escape Retirement Sum?
2) Own a Pension
By owning we do not mean you go out and buy a pension.
A pension is usually a retirement payout paid by the company you worked for.
It is usually a fixed amount of money paid from the day you retire to the day you pass away.
It is rarely (if not no longer) seen in Singapore (except if you are from the really old days of Singapore).
If you are paid or going to be paid by a pension, you can apply to be exempted the setting aside the full retirement sum!
Polarising views regarding the recent speech that Greta Thunberg gave at the United Nation's meeting have surfaced and are spreading wildly on social media.
One side praised her for determination and bravery, and admire her for pushing world leaders to act on climate change.
Another side said her speech was too cringy, that she was hypocritical, amongst much other criticism.
I figure I could give my 2-cent view on this whole thing (environment and her speech) since this is what this blog is about (although this is not a finance post, this is a platform for betterment).
PS: this is a long post, I'll try and break it down into headers you can follow.
But, let's start with a video of her speech:
Facts
Let's get some facts straightened out before we continue
1. Climate change is real, most of it comes from our man-made activities.
2. Climate change can cause serious damage to biodiversity (animals and plants), increase number of natural calamity, cause extreme weathers, and more.
3. The richest countries produced the most greenhouse emissions, the poorest countries suffer the most consequences from it
Greta's UN Speech
Most of the netizens found her speech cringy - honestly, so do I.
Was she overly melodrama? - Yes
Was her tone and expression overkill? - Yes
Was it necessary? - No
Does it matter? - NO
Why are people fixated on her tone, the cringe, the melodrama, instead of the content of what she's saying?
Focus on the content: the world leaders need to get their act together so that there's a sustainable future to speak of.
Paris Climate Agreement
The Earth's temperature is set to rise several degrees if we continue our current path.
Doesn't sound like much but if you read enough on the science behind rising temperature, you'll know it is actually quite a lot (refer to Fact 2)
In fact, we have gone way past the stage of reversing the effect of climate change.
If you read the Paris Climate Agreement, the world leaders and scientists aren't even talking reversing the effect of climate change.
They gave up reversing it, they're just going "let's try and contain the temperature rise to 2 degree Celsius".
Xiaxue commented that Greta sees things too one-dimensional and views the world too simply.
Not going to deny, but Xiaxue's right, to hope to get the world leaders to act for climate only is too one-dimensional (more on it below), and Greta does view the world too simply.
But, let's just give credit to Greta for trying to get her "prevent global warming" message out on a global stage to world leaders instead of posting another beach photo on a social media platform to a pool of netizens (I'm guilty of this too btw :P).
And why are we mocking her simple world view?
Would Greta be mocked if she was 61 instead of 16?
When we were kids, we all had wild dreams - to save lives, to fight crime, to be ironman, etc.
Our parents, relatives, adults around us didn't go "not possible la, face reality, hard to be them ok!"
Nope, they went "if you study hard, work hard, you can be any of the ones you choose to be".
Suddenly when it comes to "I wish to prevent global warming", the reply becomes "you see things too one-dimensional and too simple, it is much more complex than that, etc...".
What's the difference? You cannot choose something that's much bigger than yourself?
Well, her choice of "career" is saving lives, not in the "vaccine creation" way, but in ensuring the adverse effect of climate change never hit us (which is kinda like a vaccine)
Then there's a second post on straws, killing oneself to save Earth, and time left before the end of the world.
Not going to deny that not using straws are going to help much, but at this stage, every bit counts.
For a budding 5000-followers micro-influencer, losing 10 or 20 followers isn't going to matter much, but every one follower counts towards a larger audience.
On the time left before climate change ends our world, the timeframe given is almost always never spot-on.
World's going to end in 2012, and here we are in 2019.
Here's the thing, scientists are split on the exact time period, might not even be this century.
Doesn't mean we are not going to do anything until we know the exact end date.
Like you know you are going to retire, you just don't know it's before or after you are 65 years old.
Doesn't mean you stop working because you don't know the exact date you can retire.
We don't know the exact date the ice cap will melt, but we do know it will melt finish, and when it does, that's going to create a lot of problems.
On killing oneself, may I refer you to the below part where I talk about the misconception people have on climate change actions?
So this post compared our current times to our history of wars, famine, civil unrest, pandemics etc.
We are so much more fortunate now than we are in the past, where most of the world don't experience any of the above problems.
And yet Greta is complaining that her dreams were stolen by the inaction of world leaders towards climate change when so much had already been done to ensure the betterment of mankind.
Nice history recap in the article except, maybe if besides reading history, the author also read the biographies of those who were involved in these wars etc, he/she might get a better picture.
We have a stop button for wars - armistice, surrenders, etc. And if you stop a war, it stops. Period.
In fact, after wars, we had institutions set up, meetings, and discussions held by world leaders to prevent war (UN), famine (UN), civil unrest (UN), pandemics (WHO) from occurring again because we know the devasting effect any of these have on our societies.
The problem with this model is, we act (or start to act) only after we've been hit.
We didn't have a UN to prevent wars, famine, civil unrest until after we had them, realised they were bad and decided to do something about it.
We didn't have WHO until we had pandemics spreading like wildfire, then realised we needed to get something done about it.
We as a whole, as a society, are reactive instead of proactive when it comes to solving problems.
I think it’s easier to be blindsided by history than to face the future
If we look back at what the kids of the past wished, they also wished for no wars, even campaigned for it not much dissimilar to Greta albeit with a smaller platform because there were no social media then.
And probably the adults in the room probably dissed them off too, stating war has always been the way because the adults then weren’t forward-looking enough to solve the problem before any war begins - and after it ended realise they needed to stop wars before they happen, hence UN.
Looking back at history, many would agree wars and diseases were preventable or casualties could be minimised to lowest.
The same can be said for climate change, if enough people die, we’ll have adults in the future saying “climate change could have been prevented etc”.
We just have not reached that stage yet (where enough people died), and just saying, if we ever reached that stage, we better hope Elon Musk colonised Mars or Jeff Bezos colonised the Moon, and the tickets there are cheap.
Because it is not like wars where an armistice can end it, nor like pandemics where vaccines can be created really fast. In climate change, if it is here, it is here.
Rich People's Game
If I don’t have a roof to sleep, food to eat, water to drink, I also won’t care about climate change.
It just so happen that those who have the above 3 are contributing to climate change the most.
Yes, refer to Fact 3.
So Greta can only choose the UN platform (where the most carbon emission contributors gather) to get them to get their act together.
People's Misconception of Going Green
I have spoken to many people about going green.
I've tried going green - I tried to use less plastic, use reusable food containers for takeout, use bottles/tumbler for takeaway drinks, take more public transport, etc.
Nonetheless, I still use plastic - the candies I eat are wrapped in a wrapper, the ice cream I eat still comes in a plastic container, the food delivery I ordered came in plastic bags, and I still fly around and travel.
People seem to think that if someone is going green,
they must do the following:
1. Use ZERO plastic (no disposables, no plastic bags, etc)
2. Don't fly or travel
3. Don't eat meat
4. Generate minimum waste
You are either environmentally-friendly or not environmentally-friendly, you can't be in between.
Not going to deny, there are those who do live their lives that way, but most environmentalists don't.
Think of it as a spectrum.
On one end, it's the person that uses only disposable items, drives diesel cars, meat-only, and generates tonnes of wastage - 10 tissues to clean 1 mouth. Let's say this is 0 marks.
On the other end, it's the person that uses zero plastic, flies when necessary, vegan, generates waste that fits inside a jar. Let's say this is 100 marks (full marks).
Most of us are in between, we use plastic, eat meat, travels, and generates a decent amount of waste, but we also use cups and plates (at home), take public transport, and turn off lights when not in use.
The goal here is to be as close as we can to the full marks, or a nice 70 marks would work too.
Most of us probably fail - I don't have a matrix for this but if you do food takeout daily (food or drinks, especially coffee and lunch) you probably failed.
Think about it, 1 plastic container, 1 plastic bag, 1 plastic spoon and fork, 1 plastic cup (paper cups are actually just as bad as plastic - surprised?), all used and thrown after about 1 hour of use.
If you go to work 200/365 days, you generated 200 sets of the above combination. That's a lot.
But, we can always improve to a pass.
1. Bring your own food container to put takeaway food (can save $0.20 container money).
2. Bring your own bottle to put takeaway drinks.
3. Turn your air-con to fan mode after a couple of hours
4. Sleep early (if you don't use lights at night, you don't create emissions :P)
Yup, I know, I heard people say "but if I wash it, it wastes water. Isn't it just as bad?"
We have NEWater plant, we have developed ways to clean water so that they can be reused.
I haven't heard we have developed anything to biodegrade plastic harmlessly or reuse disposable plastics.
We have gotten used to our lives that we cannot revert back already.
It is almost impossible now to work without air-conditioning or to expect us to not travel as the world gets more interconnected.
But what we can do, is to use renewable and sustainable alternatives.
Use renewable energy instead of coal, generate less waste, push for greener materials in buildings, push for more energy-efficient transportation, etc.
Why Political Actions are Required
Policies need to change to incentivise or disincentivise certain actions.
Traffic rules and fines are created and enforced to ensure accidents don't happen like before these rules came into place.
Our government gave out subsidies to students so that they can afford education, an education that would give them a chance to succeed in life.
The same can and has to be done for the environment, but the political will to do so does not exist.
Why Political Will to Act is Low? - because welcome to the real world
In the US, oil companies pay huge lobby money to politicians to ensure their business are protected. And politicians need the money to ensure they get elected (how else would their election campaigns and political party funded?).
Clean renewable energy, green companies etc, on the other hand, are budding industries, they don't have money to lobby politicians to side them.
These companies need government subsidies or private funding to ensure they can get their product to the market.
Nevermind competition against the old oil & gas companies, it would be nice if it was a fair competition - but it's not.
So without the voters pushing their politicians to act, how else would green companies be able to compete and provide their solutions to us?
To compel matters future, oil & gas companies hire many employees - think millions of employees.
Support green companies and put the oil & gas companies out of business.
The repercussions:
As a politician, I lose my corporate sponsors (lobby money)
My voters will be out of jobs. Voters are not going to be voting for me in the next election
A politician is a career in the US.
It's not a part-time thing like Singapore.
Imagine, you doing the right thing and the result is you lose your job.
Sounds good if it's the right thing to do, but let's face it.
Who's going to really risk their career to do the right thing - takes a huge amount of guts that most of us don't have.
But, voters can change this.
You can vote to protect your politician if he/she did the right thing.
Except if he/she caused you to lose your (oil & gas) job, you probably aren't going to give him/her your vote.
In Singapore, this is the same.
Our Jurong Island refineries employee thousands of Singaporeans.
While we do not produce much of the greenhouse emission, we refine oil for other countries to use. We in a way "produced" these emissions.
Do we have a choice to shut these refineries down? - Yes
At what cost?
1. Tens of thousands of Singaporeans will lose their job
2. We might get a Hong Lim protest to get the jobs back
3. The government sure ain't going to be elected in the next GE
4. Job loss creates a social disruption in many different ways
SO THIS IS THE DILEMA POLITICIANS FACE
Conclusion
I've said my piece.
Action or no action is up to you.
Appreciate if you could share this article with more people to let them know that if we want to see less of Greta on stage making a cringy statement, then we need to get our act together, prevent climate change, reduce waste, and make the world a better place.
Thank you for reading.
Remember to offer your opinions. If you don't put your two cents in, how can you expect to get change?
Cashback, air miles, merchant discounts, other perks, these are the incentives that banks and credit card companies (Financial Institutions - FIs) use to attract you to apply and spend on their cards.
Every transaction you spend using these cards, merchants are charged a fee by the FIs for providing the card facility. The fees (known as interchange fee) are what the FIs earn and use to pay for your rewards.
For example, if you swipe your credit card when you buy a new laptop for $1,500 from Courts, FIs would charge Courts 2% of that money (or $30). That $30 would be used to pay for the FIs operation costs and a portion of it will be channelled back to you as rewards (either cash back or some other form). FIs also use the money from the cards' annual fees and interest for late payment to fund the rewards program.
In order to make up for the fees the FIs charge, shops often have to increase the price of their products/services in order to maintain their profit margins (or profits). That means if you are paying via cash or debit card, you are not earning any rewards AND you are paying for a higher price in order to subsidise those people who spend with credit cards.
"If you are using a debit card or cash for purchases, you are literally leaving points and money on the table. It's like throwing away money every time you use cash."
Here's a video that explains in detail how cards are earning money and giving you the rewards
So, use your credit cards wisely.
1) Always pay your monthly credit card bills on time and in full!
2) If you can, always charge any expenses you can find to your credit card
3) Avoid late fee payment and interest charges
4) Ask for an annual fee waiver if possible - although often times the waiver might result in loss of reward points or air miles.
How to get more cashback
and miles out of your credit cards
How many of you have this problem
where you are always wondering which credit card in your wallet will give the
best rewards when you are just about to make a payment? With so many different
cards available in Singapore, each with their own set of rewards, bonus
categories, minimum spending requirements, and more, it can be a huge challenge
to know which card will give the best rewards based on how and where we spend
our money.
To help solve this problem, a team
of credit card enthusiasts set up a new community-driven project WhatCardthat
provides a free tool to help everyone find the best credit card to use at every
place.
The website is a simple search engine, so all you have to do is key in the merchant
name in the search bar and it will show all the different credit cards ranked
in order of rewards given, with additional filters to see cashback or miles
rewards cards and also filter by category (e.g. Groceries in the screenshot).
The rewards data that the team used was put together from:
their own transactions,
transactions from other personal finance communities
like Seedly and the HWZ forum
terms and conditions of the various credit cards.
The team did share that WhatCard is very much still in beta phase so you can expect
more merchants (they are currently at 1,100+ merchants), functions and features
to be added over time. Because it is a community-based kind of project, the more people using it and contributing to it, the better the service gets. If you find any new offers by your bank or credit card, you can contribute to this
project by letting them know the offer, or you could also report any errors or share feedback and suggestions on
what to include next to make this tool even more useful for the
community.
We
think that this is a good project built by the team as a way of supporting and
giving back to the personal finance community in Singapore. It is still a beta
so it is not perfect, but it is definitely good enough to use regularly and the team have proven to be really responsive in continuing to improve the product.
This is the young adult's symbol of status, and how much we are willing to splurge for coffee.
This Starbucks Gold Card is only available to those who spent $300 per year via their Starbucks card.
That's about $25 per month.
But fret not, here is 1 trick that I have been using for the past several years to maintain my Gold status without burning a hole in my pocket, and here's how you can too!
Most of us are trying to reach Gold status via our own effort. I applaud you for that though I think you have started to realise that you either spent too much on Starbucks or you seem to never be able to reach Gold level although you seem to drink quite a lot of their Frappucino.
The trick here is to rely on the collective effort of the people around you to help you reach that Gold (pun intended).
Here are some ways I use to reach Gold:
1. Buy Starbucks on behalf of friends and colleagues
We all have friends who once in a while wants to drink Starbucks. These are friends who are not die-hard fans but do have their cravings every once in a while.
They don't have the Starbucks card and are not in the business of collecting the stars.
Why not charge their drinks to your Starbucks card?
If 4 friends buy a Venti Frap each, that's $8.30 x 4 = $33.2 charged to your Starbucks card, you are 10% closer to Gold without spending a single dime!
2. Share a Starbucks Card
Got a partner, sibling, or best friend who is a Starbucks-drinker like you?
2 heads are better than 1, or in this case, 2 person spending is better than 1.
If you can't reach the Gold on your own, find someone to support you along the way.
You can share 1 Starbucks account and charge all your Fraps to that Starbucks account via the Starbucks App.
Of course, you have to decide how you want to share that free drink you get with every 60 stars.
The last tip and I feel this is one of my best tips: 3. TREAT YOUR FRIENDS $1 OFF THEIR VENTI FRAP
Yes, treat them to $1 off the largest drink, and only the largest-sized drink.
Here's why.
The largest size Frap cost $8.30 each cup (lowest cost Frap).
If you offer a $1 discount, it will cost your friend $7.30, and you have just spent $1 to get 8.3 stars. But there's more!
You only have to treat 7.3 friends to get 60 stars credited into your Starbucks card.
And that 60 stars entitle you to 1 free drink from Starbucks - YES! You just spent $7.30 to get an $8.30 Frap drink and chalked 60 stars to Gold (20% down!).
And so far, I have rarely seen friends that reject me when I offer or suggest to get Starbucks and give them a $1 off.
And I usually do this towards the last few months of my Gold membership when I'm still short of about 100 stars.
But assuming you did this for all 300 stars, you will reach Starbucks Gold status spending only $36.50.
There you have it, the 3 tips I use to maintain my Starbucks Gold membership year after year.
What other tips do you have for you to reach your Gold status?
Share with us in the comments below!
And if you want to find more tips, tricks, and promos, check them out at our new page HERE.
As someone who has spent a huge amount of brain cells mulling over money, a well-known pillar of financial wellness is that you need to budget.
Here’s the thing: while budgeting is touted by many in the personal finance blogs as mission critical to getting your finances straight, they don’t always work. Not for long, anyway. For every budget I’ve tried — the 50/30/20 budget, zero-sum budget, spreadsheet, and envelope system — I would start out great.
I would meticulously track every purchase and expense, allocate my income into neat categories, and congratulate myself for creating such a neat, beautifully put-together budget. It felt like magic, at least at first.
Fast forward to a few months’ time, and I would have let my budget fall by the wayside. Why’s that? The reasons may stem from a number of reasons: feeling boxed-in from having too specific spending categories, lapsing into a cycle of shame followed by guilt for going over in X category, or from weaning interest.
Forget the traditional budget. Here’s what works instead:
Track Your ExpensesThis is pretty essential. It’s hard to figure out a long-lasting approach to saving if you don’t know where your money is going. There’s no shortage of free money management apps out there to help you track your spending. After you have a good idea of how much your living expenses are and anywhere else your money is going, you can create a system.
Create a Money Flow SystemHaving a system for how you save and spend your money will keep things on autopilot. The less “mind time” and work it takes, the more likely you are to stay within your spending limits. Yes, this takes work. It’s not an overnight thing.
As a self-employed freelancer, I have both a business checking account and a personal checking account. At the end of each month, I’ll automatically transfer a set amount into my personal account for basic living expenses.
I portion out “buckets” of cash that are then transferred to two separate debit cards. There’s a set amount for discretionary expenses or things that change every month. (Think eating out, groceries, gas, etc.) I also allocate any extra cash toward my savings goals. For instance, I put set amounts toward emergencies, a splurge fund, and a vacation fund. I also save for a house when I can.
Why so complicated? After I’ve devised a money flow, it’s pretty much set and I can forget about it. I methodically check my balance and monitor transactions, but that’s it.
AutomateAutomation is a godsend for a lazy money person — no shame. I automate as much as possible: savings goals, bills, and for a buffer fund in case my checking goes to zero. My bills are paid on time, and I make sure I sock some away some of my income towards retirement. If you’re new to automation, make sure you schedule your transfers so they hit a few days before or after you get paid. You’ll also want to keep an eye on things at first, just to make sure there aren’t any hiccups.
Create a Space for Guilt-Free SpendingJust like guilt-free afternoons binge-watching Netflix while eating ice cream instead of having salads and cycling classes — you need breathing room to do whatever you please with some of your cash. This will prevent you from going hog wild and splurging. Create a separate saving account for some guilt-free spending. Or allow yourself to spend $X of each paycheck on whatever you please. Of course, this is only after you’ve covered your living expenses and savings goals. Recommended Post: 10 Ways to Save on Insurance
Have a BufferOne of your friends decides to drop in unexpectedly for the weekend and you go on a pricey dinner date and night out. Sure, it’s fun times, but also cry-time for your wallet. You’ll want to have a bit of cushion in your budget for small, unexpected expenses. I like to keep a buffer of a few hundred bucks in my monthly budget, and you may need more or less.
Place Your Money on an Emotional SpectrumTry putting your entire money situation — earning, spending, saving, and investing — on an emotional spectrum. What I mean by this is to think about the things you spend money on. What do you dislike spending money on?
For instance, maybe making payments on your student loans or credit card debt are things that make you groan or ask, “Whyyy?” What are you neutral about? That could be utilities, rent, and gas for your car. And last, what types of spending and money goals bring you joy? Perhaps that’s when you get to go out for massages or buy hip clothes, or that subscription box of goodies that you look forward to receiving every month. When you categorize your money on an emotional spectrum, it’ll help guide you toward what you want to minimize or remove altogether, and what you want to have or do more of. So if you detest paying off debt (which is more than likely) focus on crushing it as soon as possible. On the flipside, if you love investing in art, try to find ways to put more money into those areas of your life.
Final ThoughtsWhile budgeting doesn’t always work, creating different systems to make saving and spending as easy and painless as possible, does. What works for me may not work for you. That’s why it’s important to approach it as an experiment. Exploring new ways will help you find a strategy that works best with you.
As my friend Mel says, “Numbers are sexy.” We love talking about numbers and
tend to fixate on them — particularly when it comes to how much we earn. “I’m a
six-figure freelance designer,” or, “If I take this job, I’ll earn $10,000
more.”
We oftentimes measure our worth based on how much money we rake in. It can be
easy to feel like you’re behind, or a grade-A underachiever when your cousin or
bestie or partner makes more than you. Sure, your income is important, but
there are other numbers that deserve a closer look than how much cash you earn.
When it comes to financial wellness, here are five metrics that trump your
income.
1.
Cost of Living Index
Bottom line: the salary you
earn living in one part of the county might not stretch as far living in
another part of the country. It's like how we always say "if we earn in
Singapore and retire in Malaysia, our money will last us 3 times longer". But
if you earn in Singapore and retire in Singapore, the budget might be tighter. The
same applies if you earn in Malaysia and retire in Malaysia.
How much you make is relative
to a number of things — one being the cost of living in your stomping grounds.
So the next time someone says they’re making $120,000 but live in Silicon
Valley, chances are they aren’t enjoying the same standard of living, than
those in less-expensive parts of the country.
2. Compensation Package
When it comes to your work
salary, it’s also important to look at the entire package, including the benefits you will be getting. Your employee benefits can make up to one-third of total
compensation costs. That includes health benefits (medical coverage), corporate discount (mobile plans, gym
memberships, etc), and group rates on things like car insurance, life insurance, and even
financial and legal advice.
Besides your take-home pay,
you’ll want to factor in the full suite of benefits that your employer offers.
In turn, that makes a difference as to how much you have to work with each
month.
3.
Happiness Report
Yes, happiness is a difficult thing to pinpoint. But in recent years metrics have been developed to gauge how
happy nations are as a whole, giving us a good idea of wellbeing and work-life
balance.
The U.N.’s World happiness report uses data from the Gallup World Poll, which
surveys citizens in 156 countries on how happy they feel — to determine
the overall well-being of a country’s denizens. The Cantril Ladder, or Cantril’s Self-Anchoring Ladder of Life Satisfaction, is made up of 10 rungs. The
bottom of the ladder equals 0 and represents the worst possible life for you.
The top of the ladder equals 10 and equates to the best possible life for you.
Per the Gallup World Poll,
Finland, Norway, and Denmark, respectively, ranked highest for happiness. The
bottom three countries were Afghanistan, Central African Republic, and South
Sudan. Where does Singapore fall? 34 out of the 156, not too bad.
Consider doing your own happiness assessment using the Cantril Ladder. Are you
living your best life? What does it exactly mean for you to be living your best
life? What steps can you make in the right direction to boost your well-being?
Remember: Your income isn’t a
measure of your wealth, your net worth is. To figure out your net worth, tally
up your assets — this includes your investments, how much you have sitting in
your savings, and any other assets, like your home or car. Next, tally up your
debt. Subtract your debt from your assets and you have your net worth.
Net worth gives a full picture
because it factors in how much money you make, how much debt you owe and how quickly you’re paying it off. It’s what you have left at the end of the day that’s for Future
You. Having a positive net worth shows that you’re financially healthy.
5. How You Spend Your Money
Are you putting your paycheck
toward paying off debt, helping your family, or are you squandering it? Not
only does how you spend your money affect your progress toward net worth, but
it’s ultimately an indicator of what you value.
For instance, while I am
typically pretty frugal when it comes to clothes, I spend more on good food. There are no right or wrong, it is just a personal preference. Just make sure that you are not overspending or exceeding your budget to indulge in the things that make you happy.
There you have it. Five metrics that are more important than your income. As
you can see, while your take-home pay does play a key role in your financial
well-being, there are other ways to measure your financial success.
