Saturday, October 22, 2016

Is A Degree or Diploma Necessary?

There have been a lot of articles lately on the mainstream media which talks about private degrees and local degrees etc.  In the year 2000, only 26% of Singaporean residents between the ages of 25 and 34 are graduates. Now, more than 50% are graduates. However, the problem is not all 50% jobs in the market are for PMETs, which means many are doing a lower skillset job than what they possess. There is another bigger problem with pursuing a diploma or degree. The problem is the world is moving too fast and the skills you learn in your 3-4 years course may become outdated too quickly.

Before we carry on further in this article, I have to clarify that I am not against getting a degree or diploma. In fact, it is a necessary certification to get our first job. What is important is we pick the right courses to study which will ensure the maximum return we have on that certificate which we spend a lot of time and money to obtain.

I was in a dialogue session with Minister Chan Chun Sing who was speaking on what the Committee of Future Economy (CFE) is doing. The CFE aims to keep the Singapore economy competitive by helping to position Singapore for the future, as well as identify areas of growth with regard to regional and global developments. One key message I got from the session was that many jobs will become redundant in time but that many new jobs will be created also. The global economy is shifting to a new phase which we, as a small country in Singapore, have to change too in order to stay competitive.

In any case, many jobs will be lost regardless if you have a Degree, Diploma or Masters. If you're in the wrong industry, there is a possibility that you will lose your job. In this article, I will explore what are the jobs which will possibly be lost and what are the new jobs which will be in demand. Hopefully this will help us to position ourselves better for our career as well as make better decisions in our education choices.

The Singapore Economy

To understand why some jobs will be lost, let's take a look at how the Singapore economy has progressed and changed over the years. The following information is reference from the Economic Development Board (EDB) Singapore:


In the 1960s there were a few developments which marked the start of Singapore’s industrialisation programme that began with factories producing garments, textiles, toys, wood products and hair wigs. Along with these labour-intensive industries were capital and technology-intensive projects from companies such as Shell Eastern Petroleum and the National Iron and Steel Mills.


Singapore's manufacturing industry evolved to become more sophisticated and included computer parts, peripherals, software packages and silicon wafers. Manufacturing eventually became the largest sector in the economy surpassing trade.


The 1980s was the start of the movement away from labour-intensive industries and the attraction to high-technology industries


EDB shifted its focus from manufacturing to strengthen the new key industries, namely chemicals, electronics and engineering. It also began leveraging its leadership in these industries to develop biomedical sciences; an area that included the pharmaceutical biotechnology and medical technology sectors


Most of the R&D activity were focused on environmental and water technology, biomedical sciences and interactive and digital media.

When will I become obsolete?

In this era where advancement is moving faster as compared to the past, jobs are becoming obsolete sooner than we think. In the past, jobs may last 10-20 years but now, today's job may be gone tomorrow. I still remembered a few years back when I was still in the army, the first 3G smart phone came out which was from Apple. The first ever iPhone was launched. Moving forward, every year there were new models and the technologies evolved as well. From 3G to 4G and even 5G in the future. Mobile data speed got faster and faster every year.

With technological advancement, many industries will be affected which will cause jobs to be lost. We are already seeing it happening now. The question to ask ourselves will be "when will I become obsolete?" Will my job last for the next few years?

Jobs which will be lost

If you realised, Singapore has transformed rapidly especially in the past 2 years only. Let me bring things into perspective:

  • Traditional taxi business has been disrupted. Now we have Uber and Grab
  • Credit cards can be paid wirelessly through paywave or paypass and can even be sync with a mobile phone for use on Apply, Andriod or Samsung pay
  • We can use our mobile phone to pay for bus and MRT rides instead of using Ez-link cards only
  • Self-payment machines are everywhere in Singapore including supermarkets, Macdonalds and Polyclinics/Hospitals
  • Macdonald has self-ordering system which eliminates the number of cashiers at counters
  • Self-driving cars, taxis and buses will become a reality in the next few years
  • Buying groceries online and getting it delivered to your house is becoming more common
  • Booking of apartments through Airbnb is an alternative to hotel stays
  • Food delivery such as food panda and Deliveroo is seen everywhere on the street
  • Buying a property without property agent is easier now with websites such as property guru and OhMyHome App
  • Food Vending machine cafe which opened in Sengkang
From the above list, there are going to be various jobs which will be lost. Property/Insurance agents, taxi drivers, retail assistants/cashiers will be greatly affected. Lesser manpower will be needed to perform the same function which machines can take over. This is happening now and it’s happening fast.

In our connected world, anybody can take over our jobs in another part of the world as long as it can go through the wire. This was what Minister Chan said. When asking ourselves "When will I become obsolete?" we should see whether our jobs can be done elsewhere in the world. For example, for website programmers/designers, if a designer or programmer in India can do the job, it would be a great risk. We are not just competing nationally but on a global basis. 

Jobs which will be in demand

Although some jobs will be lost, there will be new jobs created too. Industries such as healthcare will be in demand due to ageing population in Singapore. It is expected that by 2021, the local manpower will start to fall which means more people will be older and retired. Other industries such as IT/engineering, data/eCommerce and logistics will also be in demand.

With IT and wireless communications depended heavily in the future, more professionals will be needed in these areas. Infocomm and cyber security skills will definitely be in demand.

Is pursuing diploma or degree necessary?

Now, let's get back to the question of whether a diploma or degree is necessary? A degree and diploma is still important but it is also important to consider the career prospect of that education path. The skills which are learnt in the course should be relevant to the industry too.

If we are unsure whether we want to study that course, we can actually take modular courses first or take up professional certificates to get ourselves certified. For example, for data analysis, we can take up SPSS or Big Data courses or for project management we can take up PMP courses. Thereafter we still can take up the relevant diploma or degree to further deepen our skills and competencies.

The world is changing and in order to remain relevant, we need to re-skill or up-skill and even consider changing industries. The CFE will wrap up its findings by Q1 next year and propose to the government recommendations in order to keep Singapore's economy competitive. We should expect some changes and restructuring thereafter.

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Wednesday, October 19, 2016

The New Phillip SGX APAC Dividend Leaders REIT ETF

Word has spread around of a new REIT ETF which has been launched for IPO just last week and closed on 13th October 2016. The ETF will begin trading in the market this Thursday 20th October 2016.

REIT has been an all time favourite for Singaporeans as it provides higher than average dividends which is quite a good dividend income for many people. With the new REIT ETF, it will be easier to diversify between different stocks instead of being concentrated with just a few REITs in our portfolio.

Phillip Capital invited some bloggers for a dinner and Q&A session on this new REIT ETF just last week. I was there as well to find out more information on this interesting development in Singapore. As we know, investing in funds, such as unit trusts, have high costs that comes with it. However, for ETFs, the cost is relatively lower which makes a difference in our investment returns.

Understanding more on the Phillip SGX APAC Dividend Leaders REIT ETF

Let me list down some of the details as well as the pros and cons of this REIT:

REIT ETF focuses on Australian properties

The first thing that caught my attention for the REIT ETF is the concentration of properties in Australia. 59% of this REIT index consists of Australian properties with 30% in Singapore and 11% in Hong Kong.

Here are the constituents of the index:

As we can see, the REIT index consists of 30 stocks with the focus on Australian stocks.

Pros of investing in the REIT ETF

I asked the Managing Director of Philip Capital why the choice to put more emphasis on Australian REITs and he gave some reasons for it which I will share below.

Here are the reasons:
  1. Australia Economy has not seen a recession for the past 25 years
  2. Australia shopping malls are crowded with good occupancy rates
  3. Gearing ratio is low at 30% or less
  4. Rental reversion is positive
  5. AUD currency has gone down and is somewhat at the bottom now
  6. Strong GDP growth of average 3%
  7. High productivity growth in the country
Those are the reasons I manage to capture at the dinner session. I was actually surprised to know that Australia did not have a recession for the past 25 years and their GDP growth is higher than many developed countries, including US and Singapore, with strong productivity growth.

Back home in Singapore, we are struggling with weak GDP growth, low productivity rates and weak retail outlook which the government is trying very hard to improve productivity here. In economics, productivity growth tends to increase the salary of workers which increases consumer spending and results in stronger economic growth. This is the reason why productivity growth is so important for a country to do well. 

Back to the REIT ETF, it is interesting to note that back testing was done for the REIT ETF and the annual compounded return was 13% for the past 5 years. The average dividend yield for the REIT is about 4.5% currently. 

So far, we have seen a lot of pros in investing in the REIT. How about the cons? 

Cons of investing in the REIT ETF
In every investment, there will be risk which we need to take note of. Here are some which I can think of:
  1. Focusing on overseas stocks will increase Forex risks
  2. 4.5% dividend doesn't seem too attractive for a REIT investor
  3. Concentration in one country adds in some risks if Australia economy doesn't do well
  4. We have no control over rights issue of any REITs in the component of the ETF
The risks are mainly due to the exposure to overseas stocks but if all is well and the AUD goes up plus the economy continues to do well, it will definitely benefit investors who invest in this REIT ETF. 

To me, this is a medium risk investment which beginner investor should not invest in unless they fully know what it is about. For seasoned investors, this may be an alternative investment fund to get exposure to the Australia market. What do you think of this new REIT ETF?

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Monday, October 17, 2016

POSB launches innovative "Bank and Earn" programme

Most of us would have a POSB or DBS account which we will be able to earn cash back from now onward. I just received this information from DBS which I found it quite useful for most of us.

With “POSB Cashback Bonus”, we need only to fulfil three or more types of regular banking transactions to enjoy cashback rewards, without the need to make additional deposits.

We can earn up to SGD 130 per month via salary crediting, credit card spending, home loan instalments, insurance premiums, or investments.





POSB today announced the launch of an innovative “bank and earn” programme which will reward customers with cashback every month through regular banking transactions. This programme is also the first-of-its-kind in Singapore which allows customers to earn straight cashback rewards without making additional funds deposits on their account balances.

The “POSB Cashback Bonus” programme is the first of its kind in Singapore to offer customers direct monthly cashback simply by fulfilling at least three types of regular banking transactions. This is a simple programme for customers to earn cashback as the majority of POSB/DBS customers are already conducting these transactions with the bank. For example, customers will only need to conduct at least three of the following transactions every month to earn up to SGD 130 per month in cashback rewards:

1.     Credit their monthly salary (Minimum amount of SGD 2,500; cashback of 0.3%; monthly cashback cap of SGD 20)

2.     Spend on their POSB/DBS credit cards (No minimum amount required; cashback of 0.3%; monthly cashback cap of SGD 20)

3.     Pay their monthly home loan instalments (No minimum amount required; cashback of 3%; monthly cashback cap of SGD 30)

4.     Pay their POSB/DBS insurance premiums (No minimum amount required; cashback of 3%; monthly cashback cap of SGD 30; insurance products should be purchased after signing up for the programme)

5.     Invest through POSB/DBS (No minimum amount required; cashback of 3%; monthly cashback cap of SGD 30; investment products should be purchased after signing up for the programme)

See below for two examples of how we can earn generous cashback rewards from regular banking transactions:

Scenario A: Early-Career Individual (monthly transactions)

Salary Credit: SGD 2,500 (Cashback of SGD 7.50)

Credit Card Spend: SGD 500 (Cashback of SGD 1.50)

Home Loan Instalments: SGD 800 (Cashback of SGD 24)

Insurance: SGD 350 (Cashback of SGD 10.50)

Investments: SGD 200 (Cashback of SGD 6)

Total cashback: SGD 49.50 monthly and SGD 594 yearly

Scenario B: Mid-Career Individual (monthly transactions) 

Salary Credit: SGD 5,000 (Cashback of SGD 15)

Credit Card Spend: SGD 1,000 (SGD 3)

Home Loan Instalments: SGD 1,000 (Cashback of SG30)

Insurance: SGD 500 (Cashback of SGD 15)

Investments: SGD 1,000 (Cashback SGD 30)

Total cashback: SGD 93 monthly and SGD 1,116 yearly

Earlier this year, POSB conducted a survey among some 800 customers on their reward preferences based on their banking relationships. The majority of customers responded that they prefer the following features for their banking accounts:

·         Rewards structure that is straightforward and simple to understand

·         Cashback rewards which are credited to their accounts regularly

·         Rewarded based on their multiple relationships and transactions done with the bank

·         No requirement to make additional deposits to earn rewards

Said Jeremy Soo, Head of Consumer Banking Group Singapore, DBS Bank, “We are delighted to introduce this programme that rewards our customers based on their banking relationships with us. Currently, most of our customers are already conducting regular banking transactions with us and this means that customers can simply enjoy monthly cashbacks with ‘POSB Cashback Bonus’ without doing a lot more. As the ‘People’s Bank’, we are committed to offering our customers greater value through innovative products and services, and to providing superior deals for them to enjoy.”

To enroll in the “POSB Cashback Bonus” programme, simply log on to POSB/DBS iBanking to register, and nominate a deposit or credit card account to receive your monthly cashback. Visit for more information on the programme.

In 2013, the bank launched the DBS Multiplier Programme to reward emerging affluent customers for consolidating their finances with DBS. With DBS Multiplier, which was recently enhanced in August 2016, customers are able to enjoy a higher interest of up to 2.68% p.a. on their account balances by fulfilling any three of the five transaction categories. The programme has been a hit with customers and the bank has now more than 90,000 accounts. For more information on the “DBS Multiplier Programme”, please visit

*This is NOT a sponsored post

Wednesday, September 21, 2016

MINDEF & MHA Group Insurance

Many of us would have seen the news on the new subsidised insurance which MINDEF is providing to all personnel including regulars, NSF and NSmen. This also extends to your spouse and children. You can read the news here.

The purpose of this post is to uncover the protection provided and the premiums payable. From what I see so far, the coverage we get and the premiums payable is so much lesser than if we were to get from outside insurance agents. You'll be surprised it is about half the cost. This is one of the 30 recommendations by the Committee to Strengthen National Service (CSNS) to better recognise the contributions of national servicemen to national defence and security, and to strengthen our care for them.

If you've served national service, this will be of interest to you. If not, if your spouse has served national service, you can also get the insurance through him or her.

What is the MINDEF & MHA Group Insurance?

Under the MINDEF & MHA Group Insurance, there is group term life and personal accident insurance. Even if we do not buy any insurance, from 1 July 2016, we will automatically be provided with $150,000 group term life and $150,000 group personal accident insurance coverage during the period of our full-time NS and operationally-ready NS (ORNS) duties. The premiums are fully paid by MINDEF and MHA.

Group term life insurance

To get additional coverage, we can opt for the voluntary scheme. This scheme will only be available from 1 July 2016 for MHA personnel and 1 October 2016 for MINDEF personnel. We can get term life and personal accident insurance through this scheme. I will focus more on the MINDEF/SAF group. The premiums for the Group term life insurance is as below:

(Group Term Life Premiums)

As we can see, for a coverage of 1 Million, the premiums is only $41 per month. This covers 1 Million in the event of death or Total Permanent Disability only. If we compare to a term life insurance in the market using compare first website, the lowest will be $71 per month.

Critical Illness Rider

If we're thinking to just get insurance for death and total permanent disability, then it wouldn't be much of an issue. However, if we want to add in riders for critical illness, there are certain limitations for this scheme.

The limitations are:

  1. Critical illness only cover maximum $350K
  2. The premiums are not flat but increasing 
The critical illness rider under the Group term life insurance is called "living care". It covers against 37 common critical illness. Here are the premiums payable:

(Living care rider premiums)

As we can see, the premiums are in age bracket and not flat rate. This means we have to pay more per month as we hit the next age bracket. The problem is when we get pass 50 years old, the premiums can be quite a lot and even more when we are above age 60. If we are planning to add in this rider, there may be a problem in later parts of our life.

Disability Income Rider

There is also another optional rider called disability income. This coverage will replace your income in the event of disability. The annual coverage amount is based on 50% of your monthly basic salary multiplied by 12 times up to a maximum annual benefit of S$120,000. 

Here is the premiums table:

Similar to the living care rider, the disability income rider premiums are increasing. A point to note is the riders have to be bought together with the Group Term Life or Group Personal Accident insurance. We cannot buy the riders only without the main insurance.

Group Personal Accident insurance

For the personal accident insurance, it provides coverage in the event of an accident. We can cover up to $600,000 at cheap premiums.

Here's the premiums table:

(Personal Accident Premiums)

For personal accident, the premiums are on a flat rate and doesn't cost much. For the full list of items and conditions we can claim, you can refer to the brochure here.

List of resources

Lastly, I've complied the list of brochures from the website which I've wrote in this post. You can refer to the brochures for more information on the coverage and the premiums. I understand that to apply for the insurance, we cannot get through the public insurance agents channel and have to purchase direct from Aviva.

  1. Group Term Life Product Summary
  2. Group Personal Accident Product Summary
  3. Living Care Product Summary
  4. Disability Income Product Summary

For the full suite of insurance offered under the MINDEF & MHA Group Insurance, you can refer to the website here.

The above products are more for MINDEF personnel. For MHA personnel, you can refer here. It is quite similar from what I see.

I hope this post is useful for those who want to find out more on the new group insurance for people who served national service and played a part in contributing to national security. Don't forget this applies for your spouse and children as well so you can also buy for them through the voluntary scheme.

Thursday, September 15, 2016

Practical Ways To Increase Our Income

The road to financial independence is sometimes not an easy one. Many people in the past such as my parents' generation born in 1950s-1960s were savers. They work hard, they save money and never really had much luxuries. Life was simple back then. However, you would have realised that the baby boomers generation still did not have much savings. This is after working hard and saving money all their lives. Why is this so?

The reason is simple, most of them could not increase their income due to circumstances back then. Some of them had to quit school early to work in order to supplement income for the household. Singapore was also transforming fast during the 1980s and 1990s which means jobs were changing fast too. Some were left stranded with their skills and experience being made redundant and this caused them to suffer wage cuts or stay stagnant in their career.

Income is an important factor on the road to financial independence. You can be saving 50% of your income but if you earn only $2000, that is just $1000 savings which is not a lot. Furthermore, if you want to start a family or have kids, it is quite hard to save if you have a low salary. I have been focusing on increasing my income which I see it necessary if I want to achieve financial independence earlier. It may take years and a lot of hard work to increase income but it will all be worth it in the end.

If you're looking at a career switch or to upgrade your skills for more income, this is the post for you.

Ways to increase your income

Find A Job You Really Like - Mid career switch is possible too

If you hate your job, most likely you're not going to do well in it. Passion has created success for many people as they no longer feel a burden to work. People with passion tend to excel in their work and create more income for themselves be it in their career or business.

The problem with finding a job you like is when we were younger, we may not have chosen the right course to study and thus not able to enter the industry we want. We may have spent $25,000 on a university education which we realise we didn't like at all. When we enter the industry we don't like, we may want to change.

With the most recent statistics by Ministry of Manpower that the unemployment rate has risen and more workers have been retrenched, it is all the more vital to know how and where to acquire the right skills. Some sectors are still lacking in manpower and in this competitive environment, without the relevant qualification, it may be hard to change industry. However, we can actually get some help in this. I too may want to change industry so I've been looking at some relevant courses to gain better competitive advantage. To my surprise, I found various schemes which are really quite useful. In this blog post, I'll list down some schemes which I found that will help us progress better in our career:

U Future Leaders Programme 

(U Future Leaders Summit 2015 speaker line up) 

This is a programme where there are a series of seminars, conferences and mentorship sessions to help us up-skill and even gain access to useful networks.

It comprises of:

1) Future Leaders Summit - The  flagship conference featuring speakers such as the CEO of DBS, Managing director of LinkedIn, vice president of amazon etc.

2) Future Leaders Mentorship - Where industry leaders conduct mentoring sessions in a small group setting behind closed doors to help PMEs in their personal and career development.

3) Future Leaders Sectorial Programmes and Series – These are sector specific such as young engineers leadership programme, aspiring HR leaders programme, finance operations development programme and many more.

Funding for courses

This to me is the best funding for courses I've ever seen. On top of the $500 SkillsFuture which we know of, there are actually a lot of courses which are heavily subsidised for Singaporeans and PR.

Let's take for example you're seeking a career in project management, you would most probably need to be PMP certified which a lot of project management job position requires. PMP stands for project management professional. The PMP® designation is recognised worldwide as the standard of the profession.

The normal course fees for a PMP certification course would cost $2675. I did a search and found the course on NTUC learning hub website with the breakdown of the course fees. Here is a snapshot for your reference:

As you can see above, if you're a Singaporean or PR, the course fees reduces to $1129.75 as compared to the original course fees of $2675. If you're age 35 and above, you get even more subsidies that the course fees comes down to just $100-$200+ dollars. Don't forget we still can use our $500 skillsfutures credit to offset the course fees so in the end we don't really have to pay much for the whole certification course.

To remain relevant in the workplace, Singaporeans have always been encouraged to upskill. Labour chief Chan Chun Sing even said “As our economy transforms, more and more of our people will be in the PME sectors, and it is also NTUC's job to make sure that we help our PMEs remain competitive and stay ahead of the competition."

Aside from the $500 SkillsFuture credit given to all Singaporeans which can be used on a range of 10,000 courses, there are actually so many schemes to subsidise course fees for us. Some of the schemes are workfare training support scheme and SkillsFuture Mid-Career Enhanced Subsidy. If you're an NTUC member, you can also get further funding under the Union Training Assistance Programme (UTAP).

If you're interested in short courses such as communication skills or WSQ certified courses, I saw some by NTU which are quite interesting. Courses such as negotiation skills, or even WSQ Apply Statistics for Lean Six Sigma. More information on the short courses by NTU can be found here. There are also subsidies and SkillsFuture credit can be used.

Place and Train Programme

Lastly, I also noticed that there is this place and train programme under WDA where it enables companies to hire workers first, then to provide them with structured training to equip them with relevant skills and knowledge.Under the programme, the trainees do not pay any fees as their training will be supported and co-funded by their employers and WDA. These trainees will also receive their salaries as usual, as they are already employed once they join the programme.

There is a whole list of conversion programme where we can switch our career to. We get employed and we get the training without any cost.

Since 2008, NTUC’s e2i has also worked with various industry partners to create over 50 Place-And-Train programmes.

Getting relevant certification will help us to increase our income. The courses will also help us if we want to make a career switch into something we feel more passionate about. With the heavily subsidised courses, I think all of us can look to upgrade our skills and increase our income. Also, with programmes such as the place and train programme, switching career is no longer just a dream. There are many ways to increase our income. By just knowing more about the schemes available, we can see a better light for our career and also able to seek a passion which we yearn for.

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