With­out lift­ing a fin­ger

Simply Her (Singapore) - - Front Page -

EARN AS YOU SAVE. Ev­ery­one needs emer­gency funds. Con­stance Lim, an in­de­pen­dent fi­nan­cial ad­viser who also vol­un­teers as a fi­nan­cial ed­u­ca­tion trainer at the As­so­ci­a­tion of Women for Ac­tion and Re­search, rec­om­mends a year’s worth of your daily ex­penses. Put your money in a sav­ings ac­count that of­fers tiered in­ter­est rates – you earn higher in­ter­est the more you save.

But she says this can’t be your main source of pas­sive in­come. “Our in­fla­tion rate is gen­er­ally pegged at two to three per cent an­nu­ally. And

MAKE YOUR BLOG WORK FOR YOU. Use your blog – or cre­ate one – to earn spare cash through In­ter­net mar­ket­ing. Sandy Jadeja, a wealth coach from Lon­don and speaker at the re­cent A Good Life! Wealth Cre­ation Work­shop, says it’s one of the eas­i­est ways to make money on­line. “For in­stance, if a pop­u­lar blog­ger com­mands a read­er­ship of

40,000 a day, com­pa­nies can pay a fee to place an ad or cre­ate a link to their own web­site, on this per­son’s blog. If you have mul­ti­ple ads, that’s a good steady stream of in­come.”

It isn’t ex­pen­sive (it starts from $10 a year) or hard to reg­is­ter your own do­main, al­though build­ing a strong on­line pres­ence can take up to a year or more of con­sis­tent blog­ging and self-ad­ver­tis­ing. De­sign­ing a good web­site also re­quires time and ef­fort. BUY AN IN­VEST­MENT PROPERTY. This might not be af­ford­able for most of us, but Con­stance says you should still keep it in mind. “Rental in­come is one of the surest and safest ways of earn­ing a sec­ond in­come. But you need to build your in­vest­ment nest egg first as the cap­i­tal out­lay is huge. When the op­por­tu­nity arises – and when property prices dip – you can look into this op­tion.”


… Blue-chip com­pa­nies If you’re new to in­vest­ing, it’s “safer” to in­vest in listed com­pa­nies on the Sin­ga­pore Stock Ex­change. Bet­ter

“It’s okay to make some mis­takes when you start out. That’s why the money you use should be money you’re pre­pared to lose.” – Con­stance Lim

yet, in­vest in blue-chip com­pa­nies.

Con­stance says: “These are com­pa­nies that are im­por­tant to the econ­omy and deemed fi­nan­cially sound. They face lit­tle price fluc­tu­a­tion and don’t tend to go belly-up when the econ­omy is down. They gen­er­ally grow with the econ­omy too.”

When an eco­nomic cri­sis hits, share prices of blue-chip com­pa­nies may take a beat­ing – which is a good time to buy be­fore they pick up again, says Con­stance. “But blue-chip stocks sell at a min­i­mum of one lot of 1,000 shares. So if one share costs $16, you’ll need to fork out $16,000 to make an in­vest­ment.” She sug­gests look­ing at banks that of­fer in­vest­ment-sav­ings plans to buy into blue-chip stocks – from as lit­tle as $100 a month. … Unit trusts To im­me­di­ately build a di­verse port­fo­lio, buy unit trusts – a bas­ket of stocks pro­fes­sion­ally picked and man­aged by fund man­agers. These can in­clude govern­ment bonds, stocks and other fi­nan­cial com­modi­ties.

Con­stance says: “This is a rel­a­tively low-risk in­vest­ment with safe re­turns, which re­quires al­most zero mon­i­tor­ing on your part. It’s cheaper than buy­ing in­di­vid­ual stocks, but you may need to ac­count for other costs – man­age­ment fees you pay to your fund man­ager – which may eat into your re­turns.” … Ex­change-traded funds (ETFs) These are funds that in­vest in a stock mar­ket in­dex. “Your re­turns will mir­ror how­ever much the stock mar­ket in­dex is worth. ETFs are cheaper to buy than unit trusts be­cause your fund man­agers don’t need to study and pick the stocks to beat the mar­ket in­dex, but they pay you less in div­i­dends,” says Con­stance.

in a low in­ter­est rate en­vi­ron­ment of 0.5 to 1 per cent, leav­ing your money in the bank won’t earn you enough to keep up with in­fla­tion over time.”

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