moolahgeekin'
This took a while to get going... but here we are!
Welcome to the first moolahgeeks newsletter.
You are getting this because at some point this year you visited moolahgeeks.com and subscribed to get this in your inbox. Hopefully you did that because you liked what you saw on the site. More likely because you are my friend. Thank you for that!
I launched moolahgeeks in January this year. In the last 7 months, I have spend a lot of time researching products and strategies we can use to manage our money.
As I did that research, I was surprised time and again by how many mistakes I had been making in managing my own money over the years. And I have been a professional investor for the bulk of my career.
I invested too little of my money and often in a poor mix of investments. I used a broker that charged too much and didn't provide much by the way of analytics or tools to manage my portfolio. I left my CPF uninvested. I didn't make use of the SRS scheme (gasp!) to optimize my taxes for the longest time. I left a lot of money on the table using the wrong credit cards and using my airlines miles badly.
I am sure I will discover more mistakes as I continue to dig deeper.
It is difficult to say how much these mistakes cost me but I would not be surprised if the answer is well into a double-digit percentage of my net worth.
That's a lot of money to be leaving on the table for anyone.
So moolahgeeks is my effort to create a resource that would have helped a 10-15 years younger me to avoid a lot of these mistakes.
Now there is no shortage of financial advice on the web. Some of it is really great too.
But a lot of it is slave to twin tyrannies of affiliate marketing and the Google algorithm. You need a lot of traffic to make affiliate marketing work and Google will only send you a lot of traffic if you produce a firehose of content.
My hope is to create a resource at moolahgeeks that respects your intelligence and time, and provides answers you can trust and act on, leaving you with more time and money for the important things in life.
I would love to hear from you if you have questions, requests or ideas to help me do this better.
The nudge
nudge
verb
to push someone or something gently
Also a great book on how to make better decisions by Nobel prize winning economists.
Every month in this newsletter I will nudge you to take one step in the right direction. Often this will be something a lot of us procrastinate on, avoid or are unaware off. Some of you will act on some of these nudges and I will be successful.
Prepare your will.
Yup. Nothing gentle about this one.
Google it. Use an online tool, a free service, a paid service, an affordable lawyer or an expensive lawyer. If you have questions, many lawyers provide a free consultation in Singapore.
But if you're over 21, whether your status is single, married or complicated you would probably be better off having a written will.
If you have dependents (spouse, parents, kids, pets), this really isn't a choice anymore.
I know you don't want to think about it and we all hope its never actually needed (my subscriber count couldn't afford the hit!) but get it done.
And while you're at it also create an LPA, think about whether you want an AMD, and if you have kids, make decisions about their guardianship, should the situation arise.
If you're feeling really courageous today, you may want to get your shit together. Today’s probably not the day but bookmark that link. It's a solid resource.
moolahgeeks this month
I spent nearly all of Jun in isolation and largely disconnected, supporting various family members with medical issues and then recovering from COVID myself towards the end. Thankfully everyone is back to health in July.
Credit Cards
I started off the month looking at the impact of the KrisFlyer program revision.
For the uninitiated, KrisFlyer miles are the common currency of all rewards cards in Singapore. Even if your rewards card gives you points, you are better off converting them to KrisFlyer miles in most cases.
So any change in the program has ripple effects through the entire credit card ecosystem in Singapore.
Singapore Airlines increased the miles needed for redemption bookings by 8-16% and most sources reported this as a devaluation.
Digging into the numbers I found a more complicated answer.
Flight fares are up a lot worldwide, especially for peak seasons. Some of this is soaring fuel costs, some high demand as travel reopens fully and some general inflation.
So while you pay more miles for each flight, those flights also cost more dollars, leaving the value of a mile unchanged at 1.4¢ for now. That may change in a few months but for now this didn't feel like an immediate devaluation.
Money Transfers
One of the most common questions in my many WhatsApp groups is "which is the best money transfer service?". Its good to be able to finally answer that question definitively. Sort of.
While I ended up recommending Wise, the gap between the top 3 apps was quite minimal.
As a former investor in Banks, I continue to be shocked by how uncompetitive they are in any product where FinTech players are trying to move in.
Broking. Robo-advisory. And now remittances. In every product I have looked at so far, its not even close.
That's not what they told us in the meetings 😬!
Crypto for Money Transfers?
Does crypto have any real world use cases?
After a couple of high profile crypto boosters famously floundered in answering that, this week Sam Bankman-Fried (SBF), the billionaire founder and CEO of the crypto exchange FTX.com took a shot at that question on Twitter.
The whole thread is definitely worth a read but the first use case he pointed out was money transfers.
Since I had just looked at money transfer apps in Singapore, I decided to see if using crypto for money transfers made sense for people in Singapore. The answer was mostly no.
But it was no for all the reasons that make money transfers expensive and slow in traditional finance.
The actual crypto leg of the transaction can be very fast and cheap, as SBF shows. But first you must transfer money to the crypto exchange in a currency they accept.
Not many of them accept SGD today. You must first convert SGD to USD and pay a spread. But then you might as well use Wise for the whole transfer, which they will do for no additional cost.
There are cases in which crypto transfers may work better, end-to-end. Small transfers to remote destinations for instance, but it didn't feel like this was ready for prime time yet.
Around the web
The JWST: Nothing to do with personal finance, but for me, this is without a doubt the most exciting thing to happen in 2022 (sorry crypto crash, Ukraine War and Inflation!). Putting a telescope a million miles from Earth to peer into the past of the Universe - this is stuff of science fiction. Get your wallpapers here, learn more here and go down the rabbit hole here.
Salary Negotiation: Long but great.
How to value Layer 1 Blockchains: Probably not something a lot of you are thinking about, now that the wind has come out of the sails, but this is a genuinely interesting take. Lots of math.
Is Bitcoin a Ponzi?: A non-judgmental view. I found this very insightful.
Helium Network: Finally a real world use case for crypto? $365m in investment, $250m spend by users, $6.5K - you read that right, K - in monthly revenue. Liron Shapiro has been on fire recently but then he’s a bear in a bear market.
I beg to differ: “Since the total dollars earned by all investors collectively are fixed in amount, all active bets, taken together, constitute a zero-sum game (or negative-sum after commissions and other costs). The investor who’s right earns an above average return, and by definition the one who’s wrong earns a below average return.” More people should understand this.
I promise this letter won’t be all crypto all the time. But if you weren’t long last few months, there is so much fun to be had! The tide has gone out and my god there is so much free porn!
While I don’t begrudge the bears their victory laps, its also worth pointing out that Bitcoin was at $3K in Mar ‘19 and 10K in Sep ‘20. Its at $24K as I type this. Some collapse.
Let me end with an unpopular opinion: people who thought Bitcoin was a bubble at $1,000 (Full disclosure: I thought so at $100), should have a lower opinion of their own bubble calling abilities.