Home
1 For return on investment, the best home renovation is to upgrade an old bathroom. Kitchens come in second.
2 It's worth refinancing your mortgage when you can cut your interest rate by at least one point.
3 Spend no more than 2½ times your income on a home. For a down payment, it's best to come up with at least 20%.
4 Your total housing payments should not exceed 28% of your gross income. Total debt payments should come in under 36%.
5 Never hire a roofer, driveway paver or chimney sweep who is going door to door.
Invest
6 All else being equal, the best place to invest is a 401(k). Once you've earned the full company match, max out a Roth IRA. Still have money to invest? Put more in your 401(k) or a traditional IRA.
7 To figure out what percentage of your money should be in stocks, subtract your age from 120.
8 Invest no more than 10% of your portfolio in your company stock--or any single company's stock, for that matter.
9 The most you should pay in annual fees for a mutual fund is 1% for a large-company stock fund, 1.3% for any other type of stock fund and 0.6% for a U.S. bond fund.
10 Aim to build a retirement nest egg that is 25 times the annual investment income you need. So if you want $40,000 a year to supplement Social Security and a pension, you must save $1 million.
11 If you don't understand how an investment works, don't buy it.
Plan
12 If you're not saving 10% of your salary, you aren't saving enough.
13 Keep three months' worth of living expenses in a bank savings account or a money-market fund for emergencies. If you have kids or rely on one income, make it six months'.
14 Aim to accumulate enough money to pay for a third of your kids' college costs. You can borrow the rest or cover it from your income.
15 You need enough life insurance to replace at least five years of your salary--as much as 10 years if you have several young children or significant debts.
16 When you buy insurance, choose the highest deductible you can afford. It's the easiest way to lower your premium.
17 The best credit card is a no-fee rewards card that you pay in full every month. But if you carry a balance, high interest rates will wipe out the benefits.
18 The best way to improve your credit score is to pay bills on time and to borrow no more than 30% of your available credit.
19 Anyone who calls or e-mails you asking for your Social Security number or information about your bank or credit-card account is a scam artist.
Spend
20 The best way to save money on a car is to buy a late-model used car and drive it until it's junk. A car loses 30% of its value in the first year.
21 Lease a new car or truck only if you plan to replace it within two or three years.
22 Resist the urge to buy the latest computer or other gadget as soon as it comes out. Wait three months and the price will be lower.
23 Buy airline tickets early because the cheapest fares are snapped up first. Most seats go on sale 11 months in advance.
24 Don't redeem frequent-flier miles unless you can get more than a dollar's worth of air fare or other stuff for every 100 miles you spend.
25 When you shop for electronics, don't pay for an extended warranty. One exception: It's a laptop and the warranty is from the manufacturer.
Source: http://money.cnn.com/magazines/moneymag/moneymag_archive/2006/11/01/8392426/index.htm
Wednesday, September 26, 2007
Sunday, September 23, 2007
Cable TV
The minimum cost of Cable TV subscription is about $25 per month (or $300 per year). On the other hand, ordinary TV license would cost just $110 per year. The price difference is just too great.
Another reason why I do not subscript to cable TV is unlike 5 years ago, there is now a wide range of programs available on the internet (if you bother to find). With the help of faster broadband, and hence smoother streaming, we can get reasonably good viewing quality on our PC.
Another reason why I do not subscript to cable TV is unlike 5 years ago, there is now a wide range of programs available on the internet (if you bother to find). With the help of faster broadband, and hence smoother streaming, we can get reasonably good viewing quality on our PC.
7 habits of highly effective people
Stephen covey's seven habits of highly effective people
habit 1 - be proactive
This is the ability to control one's environment, rather than have it control you, as is so often the case. Self determination, choice, and the power to decide response to stimulus, conditions and circumstances
habit 2 - begin with the end in mind
Covey calls this the habit of personal leadership - leading oneself that is, towards what you consider your aims. By developing the habit of concentrating on relevant activities you will build a platform to avoid distractions and become more productive and successful.
habit 3 - put first things first
Covey calls this the habit of personal management. This is about organising and implementing activities in line with the aims established in habit 2. Covey says that habit 2 is the first, or mental creation; habit 3 is the second, or physical creation.
habit 4 - think win-win
Covey calls this the habit of interpersonal leadership, necessary because achievements are largely dependent on co-operative efforts with others. He says that win-win is based on the assumption that there is plenty for everyone, and that success follows a co-operative approach more naturally than the confrontation of win-or-lose.
habit 5 - seek first to understand and then to be understood
One of the great maxims of the modern age. This is Covey's habit of communication, and it's extremely powerful. Covey helps to explain this in his simple analogy 'diagnose before you prescribe'. Simple and effective, and essential for developing and maintaining positive relationships in all aspects of life.
habit 6 - synergize
Covey says this is the habit of creative co-operation - the principle that the whole is greater than the sum of its parts, which implicitly lays down the challenge to see the good and potential in the other person's contribution.
habit 7 - sharpen the saw
This is the habit of self renewal, says Covey, and it necessarily surrounds all the other habits, enabling and encouraging them to happen and grow. Covey interprets the self into four parts: the spiritual, mental, physical and the social/emotional, which all need feeding and developing
Source taken from this excellent website: http://www.businessballs.com/sevenhabitsstevencovey.htm
habit 1 - be proactive
This is the ability to control one's environment, rather than have it control you, as is so often the case. Self determination, choice, and the power to decide response to stimulus, conditions and circumstances
habit 2 - begin with the end in mind
Covey calls this the habit of personal leadership - leading oneself that is, towards what you consider your aims. By developing the habit of concentrating on relevant activities you will build a platform to avoid distractions and become more productive and successful.
habit 3 - put first things first
Covey calls this the habit of personal management. This is about organising and implementing activities in line with the aims established in habit 2. Covey says that habit 2 is the first, or mental creation; habit 3 is the second, or physical creation.
habit 4 - think win-win
Covey calls this the habit of interpersonal leadership, necessary because achievements are largely dependent on co-operative efforts with others. He says that win-win is based on the assumption that there is plenty for everyone, and that success follows a co-operative approach more naturally than the confrontation of win-or-lose.
habit 5 - seek first to understand and then to be understood
One of the great maxims of the modern age. This is Covey's habit of communication, and it's extremely powerful. Covey helps to explain this in his simple analogy 'diagnose before you prescribe'. Simple and effective, and essential for developing and maintaining positive relationships in all aspects of life.
habit 6 - synergize
Covey says this is the habit of creative co-operation - the principle that the whole is greater than the sum of its parts, which implicitly lays down the challenge to see the good and potential in the other person's contribution.
habit 7 - sharpen the saw
This is the habit of self renewal, says Covey, and it necessarily surrounds all the other habits, enabling and encouraging them to happen and grow. Covey interprets the self into four parts: the spiritual, mental, physical and the social/emotional, which all need feeding and developing
Source taken from this excellent website: http://www.businessballs.com/sevenhabitsstevencovey.htm
IF
If you can keep your head when all about you
Are losing theirs and blaming it on you,
If you can trust yourself when all men doubt you
But make allowance for their doubting too,
If you can wait and not be tired by waiting,
Or being lied about, don't deal in lies,
Or being hated, don't give way to hating,
And yet don't look too good, nor talk too wise:
If you can dream--and not make dreams your master,
If you can think--and not make thoughts your aim;
If you can meet with Triumph and Disaster
And treat those two impostors just the same;
If you can bear to hear the truth you've spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to, broken,
And stoop and build 'em up with worn-out tools:
If you can make one heap of all your winnings
And risk it all on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breath a word about your loss;
If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: "Hold on!"
If you can talk with crowds and keep your virtue,
Or walk with kings--nor lose the common touch,
If neither foes nor loving friends can hurt you;
If all men count with you, but none too much,
If you can fill the unforgiving minute
With sixty seconds' worth of distance run,
Yours is the Earth and everything that's in it,
And--which is more--you'll be a Man, my son!
--Rudyard Kipling
Are losing theirs and blaming it on you,
If you can trust yourself when all men doubt you
But make allowance for their doubting too,
If you can wait and not be tired by waiting,
Or being lied about, don't deal in lies,
Or being hated, don't give way to hating,
And yet don't look too good, nor talk too wise:
If you can dream--and not make dreams your master,
If you can think--and not make thoughts your aim;
If you can meet with Triumph and Disaster
And treat those two impostors just the same;
If you can bear to hear the truth you've spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to, broken,
And stoop and build 'em up with worn-out tools:
If you can make one heap of all your winnings
And risk it all on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breath a word about your loss;
If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: "Hold on!"
If you can talk with crowds and keep your virtue,
Or walk with kings--nor lose the common touch,
If neither foes nor loving friends can hurt you;
If all men count with you, but none too much,
If you can fill the unforgiving minute
With sixty seconds' worth of distance run,
Yours is the Earth and everything that's in it,
And--which is more--you'll be a Man, my son!
--Rudyard Kipling
Saturday, September 22, 2007
Milton Friedman's Freedom to choose
Milton Friedman is possibly the greatest and most influential economist of the last century. He is a staunch advocate of the free market, a smaller government and the freedom to choose.
When asked by Charlie Rose about what he hopes his legacy would be , he said that he hopes to be remembered for 2 things. First, he hopes that future economists can still find his work useful. Second, and more importantly, he wants to be remembered as someone who advanced human freedom.
A great man indeed.
Singapore Bank Interest Rates
Interest rates of Singapore Banks and Finance companies can be found on this MAS web site:
http://www.mas.gov.sg/data_room/Financial_Databases.html
Interest rates for savings accounts is just around 0.25%, a meagre $25 for every $10,000 saved. In fact interest rates in Singapore is actually one of the lowest in the world. Fixed deposit interest rates (1 year) is slightly higher at 0.84% to 0.87%. If you are over 55 years old, you get about 1%.
To obtain better returns we have to explore other avenues.
Stop working hard for money. Make your money work hard for you.
http://www.mas.gov.sg/data_room/Financial_Databases.html
Interest rates for savings accounts is just around 0.25%, a meagre $25 for every $10,000 saved. In fact interest rates in Singapore is actually one of the lowest in the world. Fixed deposit interest rates (1 year) is slightly higher at 0.84% to 0.87%. If you are over 55 years old, you get about 1%.
To obtain better returns we have to explore other avenues.
Stop working hard for money. Make your money work hard for you.
Saving too little
If you save a little each month, you will end up with a little money at the end of the year.
In order to reach financial independence faster, we need to set aside a larger portion of our income. Many self help books advocate saving 10% of our paycheck each month, which I feel is way too low. Suppose your take home pay is $2000 and you save 10%. At the end of the year, you will end up with $2400. If you save 50%, you will end up with $12,000!
In order to reach financial independence faster, we need to set aside a larger portion of our income. Many self help books advocate saving 10% of our paycheck each month, which I feel is way too low. Suppose your take home pay is $2000 and you save 10%. At the end of the year, you will end up with $2400. If you save 50%, you will end up with $12,000!
Monday, September 17, 2007
Welcome to Shrewd Babylonian!
Thank you for visiting my blog! Shrewd Babylonian is a blog which hopes to be a place where common people like you and me can share our financial/investing insights.
A wise man should have money in his head and not in his heart- Jonathan Swift
A wise man should have money in his head and not in his heart- Jonathan Swift
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