When I first started working, I could not seem to get my finances in order. I could not save more, spend less. After one year of work and a few impulse buys later, my bank account was less than stellar. Initially, there was a lot of internal guilt tripping when I couldn’t reach my finance goals, and not to mention the anxiety I felt looking at my peers advance ahead with their finances at a much faster rate than me.

It’s easy to see why money can be such an emotional topic for some. But we all know that money and emotions is never a good combination. So what can we do to hack this cycle of spending and saving?

I’m happy to report that after a few years of adulting, and many tips from many finance bloggers and vloggers later, that I live by these 3 personal finance rules to help me reach my goals on time (or faster).

#1 Build an emergency fund

The first rule of thumb is to have an emergency fund. Its importance should be abundantly clear, seeing how the global economy was turned upside down in 2020. Uncertainty is still in the air today, but really when is it not?

The recommended emergency fund should cover 3-6 months of expenses, or 6 months of your income. Personally, I prefer having 6 months of income as backup, simply because it gives me much more room to work with. But you decide what is realistic for you.

If you’re anything of a math dummy like me, it would be best to create a second savings account that acts as a deposit for your monthly savings. Money Smart has an excellent summary of the best savings accounts in Singapore.

A quick google search will lead you to several savings strategies, the most popular one being the 50-30-20 rule. In short, the 50-30-20 rule states that you should divide your finances to 50% to needs, 30% to wants, and 20% to savings. You can tweak this to fit your lifestyle, I can do 60% expenses and 40% savings comfortably.

#2 Track your expenses

Nobody likes sitting down after work counting receipts. But this is the best way to get things in order if your expenses always seem out of control.

This rule is a no brainer. You could do it on a good ole’ spreadsheet, or use an app to track each transaction you’ve made. Just, literally, write all incoming and outgoing money down.

What you get at the end of the day isn’t just a glorified receipt. It’s data, which will point you in the direction of how you can better manage your money. And that’s immensely better than drowning in guilt and shame.

Start with just tracking your expenses first (though the side effect of writing down everything is that you’ll be more conscious about your spending too). After the first month, you’ll get a sense of where you’re overspending and how you can cut down on that.

In no time, you’ll be optimising your finances like a true finance wizard!

#3 Pay debts

Watching your income get swallowed whole by debts stings. Getting over it should be anybody’s main priority.

Again, a quick google search will lead you to multiple strategies to payoff debts smarter. You can also check out an article we wrote previously about two strategies to payoff debts.

Really, the only piece of advice of advice I can give is to pay them on time. Huge debts weigh heavy on the mind and the heart. And sometimes that leads people to other unhealthy coping mechanisms, such as avoidance, or buying into dubious and risky investment schemes in the hopes of striking it big.

If your debts are too much to handle, give yourself some space to breath, calm down, before you re-look your finances. Try to approach it from a position of control. These are your finances, and you are the one in charge, not the other way around. Look into different personal finance tips and apply them consistently in your life. And whenever it gets too much, remember to carve out that space for yourself to process your emotions before you go any further.

Hopefully you’ve found these 3 tips helpful!

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We have heard a lot about the US Federal Reserve System (Fed) or US’s central bank (equivalent to our Singapore’s MAS), and how it affects the market with their monetary policy. 

One of the major components of the Fed’s quantitative easing program so far has been its huge bond purchase program which has resulted in a surge in its balance sheet to US$8 Trillion.  

The quantitative easing program by the US Fed has been a major contributor to the stellar performance of the stock market over the last few years but has also led to increased turbulence and worries among market participants recently with the rise in inflation.

What does this all mean? and how does it affect the economy?

What is the Fed’s Balance Sheet?

Like a company, the Fed’s balance sheet simply contains the number of assets and liabilities that the Fed holds. One of the major components of the Fed’s liabilities is the amount of currency in circulation.

Ballooning assets- The Fed’s assets contain mainly the government securities and mortgaged-backed securities that it purchased/hold. Since the start of the COVID-19 pandemic, the Fed has unleashed an unprecedented amount of stimulus to support the economy. This includes the purchasing of $80b/month in Treasury bonds and $40b in mortgage-backed securities since June 2020. 

When the Fed buys these bonds, it increases the money supply in the market by swapping the bonds in exchange for cash to the public, increasing the amount of money circulation in the market. Theoretically, there is no upper limit to how much the Fed can expand its balance sheet.

Dollars in circulation over the last 10 years.

How does the bond purchase program by the Fed help the economy?

  1. Lower interest rate for debts. By purchasing the bonds and mortgage-backed securities, the Fed increases the price of bonds and pushes down the yields on these assets. The interest rates of several debt instruments including mortgages are typically benchmarked to the yield of government debts, hence when the yield on these instruments drops as well.
  2. Lower interest rates encourage consumption and stimulate the economy. Lower interest rates result in cheaper financing and encourage more borrowing and consumption, which hopefully will drive demand for goods and services and stimulate production and employment. 
  3. Liquidity in the financial system prevents credit crunch. With more amount of money in the financial system, it helps prevent a credit crunch where there is a lack of funds available or banks increasing the criteria for borrowing, preventing companies from having access to capital. (Which was a real concern at the start of the crisis, as businesses and banks were worried to spend or lend, due to the huge uncertainty and fear of financial loss brought about by  COVID-19)

Too much of anything is bad

While the Fed’s stimulus program has helped to stabilize financial markets, there are now increasing concerns of a surge in inflation. (Too much money in the system causes inflation; i.e. if there is too much money, and the number of goods produced remains the same => inflation)

Inflation is an increase in the prices of goods and services. 

Some inflation is good for the economy as it helps boost consumer demand and consumption,  (it is a sign of a healthy economy, as demand for products/services increases, pushing up prices) and drives economic growth.

However, too much inflation may be bad if it results in

  1. Overspending in the near term==>overheated economy and subsequently a recession. Consumers may worry about price increases and shift a lot of their consumption to the near term, and stop spending in the subsequent years.
  2. Lower competitiveness for companies products resulting in lower exports and GDP growth

As the US economy recovers from the pandemic, inflation has surged 

So far, the Fed has believed and assured markets that the price increase is temporary, and is a result of the US economy’s reopening and recovery- as the pandemic has left consumers with excess savings that they want to spend. 

Jump in US personal savings rate since COVID-19

Whether inflation is here to stay remains to be seen, but with the Fed’s latest signal of tapering as early as 2023, clearly, some of its confidence has been shaken as perceived by some market participants, as stock markets take a beating over the last week.

Do let us know what you think in the comments section below

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We talked about how to save more money in the previous article. Now let’s talk about something that’s less fun but equally important: how to pay off debt.

We’ll all land in debt one way or another (that is of course, unless you have the backing of a trust fund), perhaps most commonly through student or housing loans. But there are other more pesky variants of debt, like credit card debts with exorbitant interest rates, or debts borne out of circumstance, such as an unexpected medical bill. 

Debts are no fun and they literally take the life force out of you. 

Unfortunately, there isn’t a magic wand you can wave to make your debts go away. But you can deal with debt in smarter ways to make it go away quicker.

Before we get into today’s debt mangement strategies proper, let’s begin with some hard truths. 

Look at your debts squarely

When there is a mountain of debt piling up every month, the last thing anyone wants to do is to look at the number and feel depressed all over again. 

But the first step in dealing with your debts is to look at it squarely. Say goodbye to debt denial. 

From there, work out the reasons why you landed in debt. Was it poor spending habits? Consider canceling your credit card. Was it a lack of forward planning? Maybe speak to someone whose more financiall savvy to learn what you can do. Was it because you didn’t have a large enough Start building a substantial fund now. Basically, identify the reason and find the right remedy for it.

Once you have the numbers down, it’s time to work out a game plan. We did some research and found these two popular strategies that might help you eliminate debt quicker. 

#1 Debt Avalanche Method

Following this method, you should pay off accounts starting from the one with the highest interest rate. 

So here’s what you need to do. 

  1. Make the minimum payment on all accounts
  2. Pay however more you can on the account with the highest interest rate
  3. Once you’ve settled your debts on that account, move onto the account with the second highest interest rate by paying the minimum amount + what you were paying for the settled account + any extra amount

This method makes sure you tackle the account with the highest interest first, so you incurr less damage at the end of the day. 

#2 Debt Snowball Method

One of the downsides of the debt avalanche method is that you might not feel like you’re making progress, especially if you’re dealing with larger debt accounts first. It’ll take a longer time before you can tick anything off your list. 

If you’re someone that functions better when you feel motivated and accomplished, consider the debt snowball method.

Following this method, deal with the account with the lowest balance first, then work your way up. 

  1. Make the minimum payment on all accounts
  2. Pay however more you can on the account with the lowest balance
  3. Once you’ve settled your debts on that account, move onto the account with the second lowest balance by paying the minimum amount + what you were paying for the settled account + any extra amount

You can accumulate small wins along the way when you use this method, hence the name snowball

However, do note that this method will mean delaying payment on the account with the highest interest rate. You will end up incurring more costs at the end of the day. Ultimately, you should know which method works best for you to deal with your debt successfully. 

In the meantime, save more, earn more, and get to work chipping away at your debt! 

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If you’re like me, your head would start spinning the moment finance terms are thrown out in conversations. Unfortunately though, there comes a time when you’ll have to take the finance Panadol if you want to be serious about adulting.

So I’ve taken it upon myself to unravel the definitions of these common finance terms, and explain them to you in the way a finance noob can understand.

I remember first hearing the terms asset and liability back in a basic financial literacy course in school. Given that my financial horizon was only as far as my monthly allowance, it was difficult to grasp economic losses and gains as long as 10 years later. With age (and plenty of adulting), I’m happy to report that that has changed.

First, let’s look at assets.

Assets – what you have

In simple terms, assets are the things that can provide economic value for you. Time is of the essence here. Assets can be classified into two broad categories: current assets and fixed assets.

Current assets include things like cash, inventory – items that can be converted into a cash easily. 

Fixed assets refers to long term assets, such as property and equipment, items that cannot be converted into cash quickly. 

Liability – what you owe

Liabilities are your debts – mortgage debt, bank debt, taxes owed. 

Likewise, there generally two types of liabilities: current liabilites or long-term liabilities.

Current liabilities refers to debts that need to be paid typically within a one year period. These include employee payroll, or an upcoming payment to a vendor. 

Long-term liabilities includes things like a bank debt that is payable over a 10 year period.

Simple enough? Not quite. 

The time factor

This is where the definition of asset vs liability becomes a little grey. While some pay consider property an asset, that is only on the assumption that you make money from it after a sale. Especially if you the property is your current residence, it’s unlikely that you will sell it in the short term. Putting a future value on fixed assets becomes tricky because there can be market shifts that are hard to predict. Case in point: the current pandemic situation today. 

Knowing how to classify which items into which basket on your balance sheet is an important financial management skill to have. Maintaining more assets than liabilities is the hallmark of any good personal or business financial management. 

Stay tuned for more finance terms coming your way next week!

If you’re like me, your head would start spinning the moment finance terms are thrown out in conversations. Unfortunately though, there comes a time when you’ll have to take the finance Panadol if you want to be serious about adulting.

So I’ve taken it upon myself to unravel the definitions of these common finance terms, and explain them to you in the way a finance noob can understand.

As a working adult, there’s a high chance that you have heard your colleagues from finance talk about profit and revenue. And you probably have a vague idea that profit and revenue refer to the financial gains made by the company. But if you were anything like me, you probably had no idea that they do not mean the same thing.


There are three types of profit that companies generally look at. 

On it’s own, each type of profit doesn’t tell us much beyond what it’s meant to. But when placed in comparison to one another, they do paint a picture a better picture of how well the company is managing the business. 

Here’s how profit is presented on a typical income sheet.


Now, you might be wondering what’s the point of calculating revenue, if you have to pay off business expenses anyway?

Think of it this way. Financial statements are like a book that tells the story of how a company is making its money. The size of revenue alone tells analysts and investors the market size of the business, and perhaps its growth potential.

As the story goes, it is possible to have a positive revenue and a negative profit. Let’s say a business makes a $10 million revenue, but balances out to a net profit loss of $2 million. If this were a startup, it’s understandable for them to have higher costs at the beginning for product development or marketing purposes. A substantial revenue size will then give clues to then potential growth of the business. 

If you think about profit and revenue not only as numbers on a sheet, but in terms of the story they tell about a company, it should help you to better translate the numbers into insights. 

Stay tuned for more finance terms coming your way next week!

“So money minded!” is usually not the nicest thing to say about someone. But if we really think about it, who isn’t money minded? We spend most of our life toiling away at work for the simple fact that we need money to finance our lives.

Money is usually the source of numbing anxiety, frustration, and not to mention endless confusion for many. And that’s not an ideal mix of emotions to be living with.

If money’s constantly on your mind, and you’re not sure about what to do with it, we might have a few ideas for you.

The So Money Minded team is made up of investment pros and finance noobs. We want to share different finance perspectives and stories that will helpfully help you along in your financial journey – no matter where you’re at.

We’re here to share our woes, experiences, highs, lows, and just get real about all things money.

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