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If you are a first-time buyer looking for a flat, it can be a pretty mind-boggling experience. Where do you start, what should you know, and what on earth does 5 I, Std, A, Imp, EA, EM, Jumbo mean?

Here’s where “The Almost Complete Goondu’s Guide to owning a HDB Flat” comes in handy. In the days and weeks to come, the following topics below will be covered. Hopefully, this will help make the whole home ownership experience less confusing and more enjoyable!

If you have tips or things to share with other readers, do leave them in the comments!

Chapter 1: The Consideration Phase

1) Who is eligible to buy a HDB flat?
2) How much should your house cost?
3) How does location affect cost?
4) When is the right time to buy a flat, and how soon can I get the keys?
5) How big a flat should I get?
6) HDB Flat Types and Models

Chapter 2: The Search

1) Should I use a real estate agent? What does an agent do?
2) How do I “Do it Yourself” (DIY) and is it difficult?
3) Things you need to know?
4) What do I need to research before viewing?
4) What do I need to look out for?

Chapter 3: Securing the loan and other costs

1) Who is eligible for a HDB loan?
2) Housing Subsidies
3) How do I create an “emergency fund” if I do take a HDB loan?
4) How do I find a suitable Bank loan?
5) How much cash must I set aside to complete the sale?
6) What’s the difference between Joint Tenancy and Tenancy-in-Common?

Chapter 4: Renovating my Flat

1) Should I use an Interior Designer?
2) How do I find a contractor?
3) Where can I find out more about the companies I’ve short-listed?
4) How to enjoy 36% discounts off big ticket household items
5) Another chance to save 36% off your household appliances!

Chapter 5: On a budget - The Cheapest resale HDB Flats

1) November 2008
2) December 2008
3) January 2009
4) February 2009
5) March 2009

Chapter 5: Questions People Ask

FAQ #1: Private property owners and HDB
FAQ #2: Selling your Property
FAQ #3
FAQ #4

Chapter 6: Related Housing Articles

Recovery Expected Only After Mid-2010
Cash-over-valuation for your HDB Flat? Think again (02Apr09)
Are Housing Prices still too high? (24Feb09)
Property prices, how much lower can it get? (24Feb09)
HDB Defaults - Good or bad News?(23Dec09)
Alt-A and Option ARM - the 2nd wave after Subprime? (17Dec08)

A Brief History of Credit Cards

In the 1950s, only people with excellent credit (like successful businessmen) could get a Diners or Amex card (the pioneers of credit cards). Because of this, credit cards were a status symbol, a prestige - if you had one, you were cool!

The initial credit card model was that companies made their money from membership fees and sales commissions, and got mad if you didn’t pay off your bill each month.

Then in the 1960s, banks jumped in and starting offering credit cards too. By the end of the decade, almost every bank were issuing charge cards. However, their business model was different - they generated most of their revenue from interest charges and late charges. In short, they aren’t interested in getting you to pay off your bill in full each month, as they earn more the longer you take to pay your bill off.

Did you know?

Banks love for you to carry a balance. In fact, minimum payments have been lowered, incentives were offered, grace periods were lowered, annual fees can be waived. Although credit cards are one of the 5 ‘C’s, these days, anyone can own a platinum card.

If you have a $12,000 credit card debt, never charge a single dime to the card after, and only pay the minimum due, it would take 400 monthly payments (33 years and 4 months) to pay off everything.

At an interest of 18% pa, it would cost you a total of $29,616 to pay off the $12,000 you charged to the card!

The Simple Rules

1) There is a difference between good debt, and bad debt. The only time borrowing makes sense is when you do it to buy something that can go up in value, like a house.

2) Treat your credit card like cash/nets. If you don’t have the cash or money in the bank, don’t charge it.

3) Use the bank. Don’t let them use you. The only reason you should have a credit card is to earn points or get cash-backs and discounts, and not treat it as a loan for money you don’t have. I love credit cards that are tied to a bank account. What I do is charge it for the points/cash-back, then pay it off at whenever I log on to internet-banking.

* summarized from “Start Late Finish Rich” by David Bach, Chapter 4.
Book borrowed courtesy of the National Library.

“The Latte Factor® is based on the simple idea that all you need to do to finish rich is to look at the small things you spend your money on every day and see whether you could redirect that spending to yourself. Putting aside as little as a few dollars a day for your future rather than spending it on little purchases such as lattes, fancy coffees, bottled water, fast food, cigarettes, magazines and so on, can really make a difference between accumulating wealth and living paycheck to paycheck.

We don’t even realize how much we’re actually spending on these little purchases. If we did think about it and change our habits just a little, we could actually change our destiny.

Still not convinced? Consider this:

$5 per day (the average cost of a latte and a muffin) x 7 days = $35 per week

$35/week = $150/month

$150 per month invested at a rate of 10% annual return =

1 year = $1,885
2 years = $3,967
5 years =$11,616
10 years = $30,727
15 years = $62,171
30 years = $339,073
40 years = $948,611

(via finishrich.com)”

I just finished the book “The Automatic Millionaire”. I grabbed it from the library and boy is it quite worn out. I guess many have read the book.

Who is this book for?
- Anybody of any income really
- Someone who doesn’t really quite like to budget everything
- Someone who doesn’t like to deal with finances on a regular basis, but yet still wants to retire comfortably

“But I’m already living paycheck to paycheck! I don’t have money to save for retirement?”

That’s where the Latte Factor comes in. I’m sure many have heard from your financial advisors that if you give up your one Starbucks coffee a day, you can save $5/day and that compounded over 40 years would make you very rich. But of course Bach is not saying stop drinking Coffee Bean or Starbucks. All he is trying to say is, we spend 8-12 hours working a day. Is it really that unreasonable to keep 1 hour of your wages to pay ourselves?

If you are like me and don’t like tracking every single cent you spend (it can be quite a pain really, and hard to keep up), Bach challenges you to just track your spending over a single 7 day period. Just 7 days of tracking is all you need to know where you can save your extra $5 from. Once you are convinced it’s possible, the next big secret is: AUTOMATE IT.

Bach argues that if 10% of your money leaves your account before you ever see it, you won’t miss it! Singaporeans would understand this really well. Every month, 20% of our money automatically gets deducted into our CPF. We’re still surviving right? So likewise, if you were to giro out an additional 10% out of your paycheck each month, you know you make it. And because it’s automatic, you won’t feel it.

Imagine if we had to manually transfer out 20% to our CPF each month. We would feel the impact of ‘losing’ that money, and it’s a monthly affair. After a few months, we might even fall behind our contributions. Take yourself out of the factor and do yourself a favor. Automate it - you only have to do it once.

Home ownership is really another form of automation for us in Singapore, since our payments are automatically deducted from our CPF each month, and we steadily build equity. Bach encourages making extra payments to shorten the mortgage. That might or might not be a good idea in Singapore, since interest rates here are so low compared to US or UK, where low means 5%, whereas our low can be 1.5-3%.

Check out the book and read how you can automate your finances and eventually become an automatic millionaire.

(These days though, billion seem to be the new million.)

This is an ongoing series of book reviews - in parts, on money-related books.

The first is this series is called America’s Cheapest Family - Gets You Right on Money by Steve and Annette Economides. According to them, this is the guide to living better, spending less, and chasing in on your dreams!

Here’s what they have accomplished so far:

- Paid off a house in 9 years on limited income (average income approx $35k/yr)
- Paid cash for all their cars
- Remodeled kitchen without a home equity loan
- Enjoyed fabulous debt-free vacations
- Fed a growing family (of 2+5) on a grocery budget of $350/mth
- Put savings in the bank!

On Vacations

Vacations should be events that build positive interactions and create long-lasting, fun-filled memories, not short weeks that stress you out because they’re breaking the bank.

Consider being a tourist in your own state (country). Pick up a guide book and look up places you can visit and day tours you can go for. Many museums select one day each month to be free to the public. You’ll be amazed at the wide array of options available.

Home Recreation Ideas:

- Make it Thanksgiving in July! Enjoy a complete turkey dinner for the family
- Borrow/Rent Movies, maybe even an odie, prepare popcorn and pretend you’re in a cinema
- Go Bowling. Some alleys have discounted rates. Check out the times
- Try backyard Camping. If you don’t have a backyard, camp out in the living room.
- Go to discount theaters.
- Enjoy Game Days. Pull out all your board & card games and have fun with them.
- Have Christmas in July! Do some Christmas shopping at thift stores
[Editor's note: Going to Daiso might work for this one.]
- Take a Free Tour
[Editor's note: There are guided map tours for areas around town]

Edu-Vacation:
Read more…

This is an ongoing series of book reviews - in parts, on money-related books.

The first is this series is called America’s Cheapest Family - Gets You Right on Money by Steve and Annette Economides. According to them, this is the guide to living better, spending less, and chasing in on your dreams!

Here’s what they have accomplished so far:

- Paid off a house in 9 years on limited income (average income approx $35k/yr)
- Paid cash for all their cars
- Remodeled kitchen without a home equity loan
- Enjoyed fabulous debt-free vacations
- Fed a growing family (of 2+5) on a grocery budget of $350/mth
- Put savings in the bank!

On Staying Healthy

- Drink lots of water
- If someone is sick in the house, wipe down all commonly used objects with disinfectant (eg. doorknob, light switches, telephones etc.)
- Wash your hands when you return home from outside
- Get 10-15 minutes sunshine a day so your body can produce beneficial Vitamin D
- Exercise
- Bleach can work wonders killing germs
- Consider Herbs and Natural Remedies.
(check out Prescription for Nutritional Healing by Phyllis Balch)
- Avoid Antibiotics. They are expensive and kill both good and bad bacteria.
- Keep your bowels operating.
- Be a leaner. If your kid has asthma, become a asthma expert.
- Book it. Start reading up and invest in your own well-being.

On Entertainment & Recreation

Having fun doesn’t have to cost a bomb. Steve and Annette are convinced that meaningful memories can be created with little or no cost if you know where to look.

Holiday Recreations

Read more…