Speaker 1: You're listening to a CNA podcast.
Speaker 2: Welcome to CNA's Money Talks podcast. I'm Andrea Heng, and
Speaker 2: it's a brand new year, everybody. And with a new
Speaker 2: year comes New Year's resolutions. Now, I'm not one to
Speaker 2: shy away from New Year's resolutions, especially when it comes
Speaker 2: to money. If you're thinking of new ways to gain
Speaker 2: more wealth with much less pain, stay with me because
Speaker 2: I'm gonna ask for some tips from Dawn Shu. She
Speaker 2: is better known as SG Budget babe and she is here.
Speaker 2: To help us out. Welcome back, Dawn, to the Money
Speaker 2: Talks podcast. Hi Andrea, nice studio. Thank you. And I'm
Speaker 2: glad that you are the first guest at this new setup. So,
Speaker 2: back to business. What were some of your financial highlights
Speaker 2: for 2024? I think a major highlight for me was
Speaker 2: hitting five digits in passive income through stock dividends. So
Speaker 2: that was the goal I've been striving towards since I
Speaker 2: was in my twenties and I finally hit that, which
Speaker 2: I think is great, and.
Speaker 2: make it 6 digits. Is that going to be harder though,
Speaker 2: do you think? It is, but the good thing about
Speaker 2: all these is that it really compounds. And the truth
Speaker 2: is I didn't have to add so much new capital
Speaker 2: to get to that 5 digit mark. It was really
Speaker 2: a case of the stocks that I owned, increased the
Speaker 2: dividends and they grew, right? So it was passive. So
Speaker 2: that means in 2025, you're going to be a little
Speaker 2: more active just to get 10 times the amount. OK.
Speaker 2: I've been seeing all sorts.
Speaker 2: Of new money hacks, money habits on social media. One
Speaker 2: of them was Project Pan by influencer Daisy and Mitchell
Speaker 2: on TikTok. So basically what it is is she has
Speaker 2: a goal to finish all her unfinished makeup and skincare.
Speaker 2: They have to hit pan before she buys a new one.
Speaker 2: Therefore project. I thought it was brilliant and I'm honestly
Speaker 2: quite inspired because I have way too much makeup.
Speaker 2: But you are SG budget babe. You're all over the
Speaker 2: internet talking about all things money, so you must have
Speaker 2: tried quite a few new money habits here and there
Speaker 2: over the years. Are there any new money habits for
Speaker 2: 2025 that you're hoping to cultivate? I think it really
Speaker 2: goes back down to that six digits. Walk me through it.
Speaker 2: And at the same time, I'm also building other things
Speaker 2: on the side to get.
Speaker 2: Closer to greater passive income from multiple sources as I age.
Speaker 2: You sound so busy. I do not get enough sleep,
Speaker 2: but I think it's really important because I've always talked
Speaker 2: about on my blog that we should have multiple streams
Speaker 2: of income and a lot of these in my 20s
Speaker 2: were built on active sources of income. Now that I'm
Speaker 2: in my 30s and I have children, I realized it's
Speaker 2: not always possible to exchange our time and energy for
Speaker 2: money all the time. We need to start building.
Speaker 2: Passively, so that comes from building businesses, from investing in
Speaker 2: stocks or instruments that will give us that kind of
Speaker 2: passive income. And at the same time, I'm also exploring royalties,
Speaker 2: which is something new. So then that will create another
Speaker 2: lake to my table of multiple streams of income. I'm
Speaker 2: interested in royalties. Is that really a big market? Is
Speaker 2: there a lot of money to be made? I don't
Speaker 2: know yet. I'm actually writing a book and it's coming
Speaker 2: out in 2025. OK, I always hear things about how
Speaker 2: authors are not rich.
Speaker 2: But we'll find out in 1 to 2 years' time.
Speaker 2: So we know the drill, Dawn, OK. Spend less, save more,
Speaker 2: but surely it's not that simple. I am testament to that.
Speaker 2: I am finding it really difficult to just spend less
Speaker 2: and save more. It turns out that the savings that
Speaker 2: I get from spending less is really not a lot.
Speaker 2: I mean it's pockets here and there and I think
Speaker 2: it's especially hard to do it this time around because
Speaker 2: things are a lot more costly nowadays, let's face it.
Speaker 2: Now, is cutting back the only answer to having more
Speaker 2: cash in the bank? No, it's not, but I have
Speaker 2: to say two things. First of all, it is simple,
Speaker 2: but it's not easy. Yes, it's easier to just spend,
Speaker 2: it's easier to indulge. It's easy to just go out
Speaker 2: for a good meal to reward yourself after a hard
Speaker 2: day of work. Oh, too easy. Yes, but it's more
Speaker 2: difficult to
Speaker 2: Prep that meal and buy groceries so that you save
Speaker 2: a little bit more. And it's even harder to do
Speaker 2: that consistently when you have many things running on your plate.
Speaker 2: So what is simple isn't always easy, but we have
Speaker 2: to really decide what are the decisions that we're going
Speaker 2: to make based on the outcomes that we want to achieve.
Speaker 2: The second thing going back to your question, is cutting
Speaker 2: back the only way? No, it's not. And in fact,
Speaker 2: I feel cutting back is indeed getting harder, right? The
Speaker 2: cost of living has
Speaker 2: Increase if you dine out a lot, especially, food costs
Speaker 2: are up by around 30%. So for people who dine
Speaker 2: out really often, that's where you now need to start
Speaker 2: to decide whether you want to do the harder part
Speaker 2: of prepping your own meals or potentially keep out that
Speaker 2: dining out experience but cut back on other areas in life. However,
Speaker 2: I always feel that cutting back is always a limit
Speaker 2: because the max you can go is just how much
Speaker 2: you spend.
Speaker 2: There is another way to it, which is to increase
Speaker 2: your earning income. Yes, of course. OK, talk to me
Speaker 2: about that. So when you increase your earn income, whether
Speaker 2: through active or passive sources, you can actually get a
Speaker 2: lot more money versus what you spend. So when you
Speaker 2: increase that and still keep your spending moderate, you can
Speaker 2: actually get a bigger difference than simply trying to cut
Speaker 2: back because there will be also this point when you
Speaker 2: say until you're just miserable. And what's the point of life? Exactly,
Speaker 2: and then it feels like, oh my God, I'm working.
Speaker 2: so hard to say and nothing is coming out of it.
Speaker 2: Is this really the only answer. So you're always at
Speaker 2: privy to the fact that people can raise prices rather
Speaker 2: than focus on something we don't have control over, I
Speaker 2: always talk about putting our focus on things that we
Speaker 2: can control, which is how much we spend. OK. We
Speaker 2: cannot control if other people raise their prices, but we
Speaker 2: can moderate our spending and still keep to our budget.
Speaker 2: We might have to increase that budget, but at least
Speaker 2: we're still keeping to one. You know, I'm I've taken
Speaker 2: one of your old pieces of advice.
Speaker 2: When I last spoke to you about, you know, buying
Speaker 2: things in bulk and buying house brands. I know you
Speaker 2: are like house brand queen. I started doing that and
Speaker 2: I have saved a chunk of money. Like my grocery
Speaker 2: bills are not $100 anymore for two people and it
Speaker 2: lasts us like months. So thank you for that. I
Speaker 2: think that it is possible, but you have to go
Speaker 2: through the hardship of it, like you need to put
Speaker 2: in the hard work, buying, making sure that you are
Speaker 2: paying attention to prices, paying attention to calculations.
Speaker 2: And I personally think while it's a bit tedious, it's
Speaker 2: worth it. It's absolutely worth it. So what about side hustles?
Speaker 2: So you wrote something for us at CNA about how
Speaker 2: having a side hustle might be an option as a
Speaker 2: way of diversifying income streams because you know, having a
Speaker 2: full-time job may not be enough to reach our financial goals,
Speaker 2: especially when things are so costly nowadays, right? So for
Speaker 2: those for whom a side hustle is not an option,
Speaker 2: what would be
Speaker 2: an option for someone like me, no time, no energy
Speaker 2: to have a side hustle and I still need to
Speaker 2: work on my full-time job and give it my 150%.
Speaker 2: There's only two ways out of it, right? First, you
Speaker 2: can think about if you can build a side hustle
Speaker 2: that requires less time and energy and my favorite side
Speaker 2: hustle to do is to invest in dividend stocks because
Speaker 2: I just need to find great companies with great leadership
Speaker 2: and they are the ones who are running the business,
Speaker 2: increasing the dividends, not you. Yeah, and all I do
Speaker 2: is just.
Speaker 2: My money in those stocks. Of course, there's always a
Speaker 2: risk that your money could go down if the company
Speaker 2: does not do well, but that's where the art of
Speaker 2: selecting and making sure that you invest in the right stocks,
Speaker 2: the right companies are at play. You also have to
Speaker 2: diversify your risk a little bit, so that's the whole
Speaker 2: conversation there. But the other thing also is I feel
Speaker 2: in today's times, there has been a lot more options
Speaker 2: for side hustles that don't take up so much time
Speaker 2: and energy as well other than investing. So for instance,
Speaker 2: in the past you had to be an influencer with
Speaker 2: a following to do affiliate marketing.
Speaker 2: That's right. Today, and I've just talked about this very
Speaker 2: aggressively in the last few months, there are affiliate marketing
Speaker 2: options to people who do not really have a following.
Speaker 2: I noticed that I started seeing that on Instagram and TikTok.
Speaker 2: I'm like, who are these people? And I realized, wait
Speaker 2: a minute, this is a way that they're earning money
Speaker 2: while doing basically everyday things. And the thing is that
Speaker 2: these platforms have only just launched these features recently. It
Speaker 2: used to be gated to only those who were, but
Speaker 2: now the everyday person can do it.
Speaker 2: There's also UGC content. I know people who create user
Speaker 2: generated content for brands and they do it for a
Speaker 2: nominal fee, even though you don't have a following, you
Speaker 2: still can earn from that. But of course, if having
Speaker 2: said that, all of that is still too much time
Speaker 2: and energy, then the other option, especially for someone like you,
Speaker 2: would be to increase on your career and you can
Speaker 2: bargain and negotiate for a higher salary while proving to
Speaker 2: your employer that you have indeed added more value and
Speaker 2: it will be their loss if they lose you.
Speaker 2: Yeah see time for me to make an appointment with
Speaker 2: my boss. What about putting, you know, a big lump
Speaker 2: sum of money that I've saved aside. What can I
Speaker 2: do with that? So instead of a side hustle per se,
Speaker 2: could I perhaps put something somewhere and leave it alone
Speaker 2: and let it grow passively, which is what I do
Speaker 2: in dividend stocks, right? But at the same time, so
Speaker 2: there are different options. There is fixed income and there
Speaker 2: is equities. OK, fixed income includes really safe options like
Speaker 2: your fixed deficits.
Speaker 2: your endowments and basically anything that gives you a guarantee
Speaker 2: with an exchange for you. It could even include bonds,
Speaker 2: although bonds are a bit iffy there because you have
Speaker 2: to pick the right ones. That's right. Even the local
Speaker 2: banks give you a fixed deposit that could give you
Speaker 2: a decent 2% or even 3% in exchange for a lockup.
Speaker 2: So that's one way, right? Or endowments by the insurers,
Speaker 2: if you lock up for a longer period of time,
Speaker 2: you could also get those kinds of returns. But at
Speaker 2: the other side of the picture, if you don't want
Speaker 2: to lock up your money.
Speaker 2: Yeah, then you have to take on more risk. Yes,
Speaker 2: investment risk, more liquidity equals more risk. Exactly. OK, that's
Speaker 2: a really clear picture of what we can do, the
Speaker 2: various options that we can take. Now, what's usually a
Speaker 2: financial habit that, you know, all of us typically at
Speaker 2: the start of the year, OK, I'm going to do
Speaker 2: this and it's going to be successful and then 3
Speaker 2: months later, you check in on them and they're like,
Speaker 2: so how's that new habit going? Oh no, it's a
Speaker 2: massive failure.
Speaker 2: In your observation, what's been that one habit that people, well,
Speaker 2: don't hope to fail, but they eventually do fail to
Speaker 2: start investing? Oh, when it comes to money habits, it's
Speaker 2: always to start investing. I've lost count of the number
Speaker 2: of times or the number of DMs I've gotten from
Speaker 2: readers who say that I want to learn investing, but
Speaker 2: I don't know how. I promise I'll learn it. They
Speaker 2: read books or they go for courses and I always
Speaker 2: point my readers to different options.
Speaker 2: Free options. Here's your options, including like what I'm free, free, right?
Speaker 2: You just need the time to go through that. Otherwise,
Speaker 2: if you want shortcuts, crash course, that like workshops and
Speaker 2: crash courses that you can go for, or if you
Speaker 2: want super detailed and you don't mind paying more money
Speaker 2: for physical, there's of course trainers in Singapore who could
Speaker 2: do that for you for a couple of thousands as well.
Speaker 2: But some of them, interestingly, even if they take that
Speaker 2: first step to learn, right, the act of implementing it is.
Speaker 2: missing because I would then ask them, and I like
Speaker 2: to ask my students because I run those free workshops
Speaker 2: or crash course at a very affordable fee for just
Speaker 2: a couple of $100 right? And I like to check
Speaker 2: in on them to ask. So guys, how many of
Speaker 2: you have started investing this year? A lot of them
Speaker 2: have said, so I've completed the lessons, but I haven't
Speaker 2: yet started. It's that inertia, it's that fear, and then
Speaker 2: I would ask what can we do to, you know,
Speaker 2: help you overcome that. But
Speaker 2: At the same time, there's also very little that we
Speaker 2: can do. The person has to be the one. Of course.
Speaker 2: And I'm curious about that like what is it in
Speaker 2: the inertia to make that first step? Is it fear?
Speaker 2: Is it uncertainty? Is it just risk averse? I think
Speaker 2: it could be all of that and more. Sometimes it's
Speaker 2: really the fact that it's just inertia, right? If you
Speaker 2: want to, for instance, a common New Year's resolution is
Speaker 2: to get fit.
Speaker 2: But it's a lot of inertia to get off the couch,
Speaker 2: not Netflix, and go for a run, right? So in
Speaker 2: the same vein, a lot of people, it's just easier
Speaker 2: to leave the money in the bank or just pass
Speaker 2: it over to the insurance agent to manage or pass
Speaker 2: it over to the banker, so you don't have to
Speaker 2: get involved yourself. But the truth is it's not that hard.
Speaker 2: I think the bigger problem is a lot of people
Speaker 2: overcomplicate things. Today it only takes a couple of seconds
Speaker 2: to open up a brokerage account because of pass, right?
Speaker 2: And then when you're in a brokerage account, if you want.
Speaker 2: Something super simple. They are like exchange traded funds that
Speaker 2: track the index, the market index. So as long as
Speaker 2: you invest in relatively safer markets or less volatile markets,
Speaker 2: you'll still be relatively OK. But at the same time,
Speaker 2: people don't really do that. Or even if we look
Speaker 2: at guaranteed options, OK. I remember not too long ago
Speaker 2: when I talked about how use bank savings accounts, versus
Speaker 2: normal bank savings account. How many people actually make the switch? Yeah.
Speaker 2: It's one thing to do the research, it's one thing
Speaker 2: to be excited.
Speaker 2: About it and then you don't do anything about it,
Speaker 2: then you're not going to earn anything from it, are you? OK,
Speaker 2: I felt that one. I felt that one. It's the
Speaker 2: time of the year where we take stock of things,
Speaker 2: where we are in our financial portfolios and plans. When
Speaker 2: we review these plans, what's the most important thing to
Speaker 2: look at whether you're on track. So I always feel,
Speaker 2: and everyone's goal is going to be different. If for instance,
Speaker 2: you have been spending more and you feel guilty about that,
Speaker 2: that's me.
Speaker 2: Action plan would be to cut back on the spending
Speaker 2: or earn more. So you can spend without that guilt, right?
Speaker 2: And for instance, if you feel that you are underinsured
Speaker 2: and you really want to get to it before anything
Speaker 2: happens on your health or at the insurance site, then
Speaker 2: get to it. It's not that hard to just book
Speaker 2: and insurance agents are going to be very happy to
Speaker 2: just here at your house in your convenience to help
Speaker 2: you get that set up. But what if we don't
Speaker 2: have the time to, you know, shop around, compare prices,
Speaker 2: see if we need to
Speaker 2: You know, change insurer and stuff like that. I mean,
Speaker 2: are there, is it OK to just sit there and
Speaker 2: Be OK and stick with what we have. I love
Speaker 2: that you're asking this question because I always feel that
Speaker 2: time is always just an excuse. We can always make
Speaker 2: more time. It's not that we don't have time. It's
Speaker 2: just not a priority, right? So if it's not a priority,
Speaker 2: then what are our options? Well, it's OK to just
Speaker 2: let it sit. If you are OK with the trade-offs
Speaker 2: and the potential consequences, or if you find out that
Speaker 2: your current plans are pretty still pretty good, exactly. If
Speaker 2: it ain't broke, don't fix it.
Speaker 2: Right. Exactly. And I feel that when it comes to reviewing,
Speaker 2: people don't have to stress out so much about having
Speaker 2: to review their insurance portfolio so often. Yeah. I always
Speaker 2: say just do it when your life milestone changes. So
Speaker 2: if nothing changes this year, you didn't buy a new property,
Speaker 2: you didn't have a new kid, you didn't have a
Speaker 2: new dependent or lost a dependent, then maybe you don't
Speaker 2: really have to review it. Wait for the next life
Speaker 2: milestone and then do it then. But more importantly is
Speaker 2: that when you act on this and you review, are
Speaker 2: you meeting your goals? Because if you
Speaker 2: You're not, every year is a great chance to make
Speaker 2: sure that we recalibrate and get back on track because
Speaker 2: otherwise we'll all be talking about how I want to
Speaker 2: retire at this age with this amount of money or
Speaker 2: this passive income or having this amount of interest or
Speaker 2: use or dividends, but you never get there because you
Speaker 2: never built it despite having the last 1015, 2030 years
Speaker 2: to do so. Yeah, indeed, indeed. And I think this
Speaker 2: is one of those biggest tips like if you know,
Speaker 2: reviewing shouldn't be so.
Speaker 2: most stressful and I think that the tip here that
Speaker 2: I really like is, you know, do your review at
Speaker 2: the major milestones in your life because that's when things
Speaker 2: really change and you need to take stock of what's happening.
Speaker 2: I'll also give my template for the annual reviews that
Speaker 2: I do for myself. All I look at is how
Speaker 2: much did I earn, how much did I save. So
Speaker 2: I don't look at how much I spend anymore. I
Speaker 2: used to, but now I look at how much I
Speaker 2: save because it's the difference that makes all the more important,
Speaker 2: and it's how much you saved in proportion.
Speaker 2: To what you earn. Exactly. And then the last thing
Speaker 2: I look at is my protection. So if nothing changes
Speaker 2: in my life milestones, I'm not going to review that.
Speaker 2: This year, I'm not reviewing that at all. And the
Speaker 2: final one, so just 4 buckets, right, it's investing. I'll
Speaker 2: look at my investment performance on the whole to see
Speaker 2: if there's anything I can improve and most importantly, how
Speaker 2: did I fare against the markets. Right? So just just
Speaker 2: 4 things and I think that should be a 30
Speaker 2: minute exercise at the most. Dawn, it's been great. Thanks
Speaker 2: very much for coming on the Money Talks podcast again.
Speaker 2: Thanks for having me.
Speaker 2: Hope you've gained some insights into how to be better
Speaker 2: money-wise in 2025. If you've got any comments or questions,
Speaker 2: feel free to drop us a message. Money Talks is
Speaker 2: available on Apple Podcasts, Spotify and YouTube Music as well.
Speaker 2: Do leave us a rating. We're gonna give credits to
Speaker 2: the team as well. Christina, Robert, Tiffany Ag, Junaini Johari,
Speaker 2: Joanne Chan, Hanida Amin, Saya Wyn, and Chris De Leon.
Speaker 2: I'm Andrea Heng. Thanks for listening to Money Talks.