26 October 2006

Mr Wang's Personal Trivia

Yesterday's ST Review section had two articles, each on a very Singaporean topic. The first article is about employing a maid:
ST Oct 25, 2006
The price of a good maid

By Newsdesk Reporter, Arlina Arshad

AFTER giving birth to twins in July this year, marketing executive Ng Su Ming, 35, decided to hire a maid. She wanted someone who could help look after the twins and another toddler when she went back to work.

Her husband consulted several agents and decided to engage one which charged an agency fee of $1,388, more than double the average.

Homemaker's director, Mr Alvin Kor, recommended Ms Lore Lee, 27, a mother of two who had worked with children in a Philippine hospital, and who had looked after triplets before.

Madam Ng said: 'The agent was very detailed and comprehensive, he went through everything with my husband for two hours. Other agents would just give you a one-liner and two pages of maids' biodata.'

She is pleased with her maid who is 'very good in childcare, has initiative and can read medicine labels'. Her maid's salary is $50 more than the market rate of $350 a month. 'It's OK to pay a bit more for a maid who is well-trained and can stay with you long-term,' she said.

Maid agents say good maids are available if Singaporeans are willing to pay higher salaries ....
The second article is on owning cars vs using public transport:
ST Oct 25, 2006
Getting more on board

ANY review of public transport usage will have to contend with one Singaporean immutable: the wish to own a car. For many it is a validation of success; some are attracted to the assumed social cachet. The mobility a car offers surprisingly is not thought to be the sole reason, as would be evident in cities with unreliable or patchy bus and rail services. But Singapore's transport system is reasonably good for a city of its population and compactness. A controlled rise in car ownership also happens to be a policy objective to fulfil citizen wants, subject naturally to the limitations of road-building capacity. Understanding why car use has outpaced bus-and-rail's rate of growth in the period since the last land transport policy study was done, in 1996, is in the circumstances less relevant than making public transport so efficient car-owning office workers would prefer it for the convenience. The family car would strictly be used for evening and weekend social purposes.
Everybody's circumstances are different. Anyway, I'll share mine. Personally I don't drive, but I do employ a maid. In fact, I am just about to employ a second maid. Considering that my domestic requirements are fairly average - two young kids, 5-room HDB flat - this may seem a bit of a luxury.

On the other hand, I don't own a car. And a car is a lot more expensive than a maid (or two). I believe that having two maids adds more to my quality of life than having a car, or for that matter, having one maid and one car.

It helps, of course, that years ago, I had deliberately decided to buy a flat very, very close to a NEL MRT station (then still under construction). Today, the line is up and running, and I can travel from my home to Plaza Singapura (Dhoby Ghaut MRT) or VivoCity (Harbourfront MRT), faster by train than I would be able, by car or taxi.

Another thing about the flat purchase. When we got married, my wife and I considered our housing options - to buy a condo; a HDB resale flat or a new HDB flat. We quickly dismissed the new HDB flat option, because it would mean living in some outlying area of Singapore (like Sengkang - where transport is a hassle).

We ultimately decided against a condo, because we wanted (1) to save money, and (2) to live either near my parents or hers, and there were no suitable condos in those locations, and (3) we knew we wanted kids, and therefore we wanted a bigger place, and the old HDB 5-rooms are considerably bigger than new HDB 5-room flats, and for that matter, bigger than most condos.

So we ended up with the HDB resale flat, which is near my parents' place (10 minutes' walking distance) and very, very near a NEL MRT station. As it turns out, I get to spend more time with my parents, and they with their grandkids, than would have been the case if my home was further away.

To "make up" for living in a HDB flat, we decided to get a country club membership so that we could use the facilities and "enjoy life". This was a rather silly mistake. We still have the membership today, but like most country club members (excluding the golf addicts), we hardly ever go. The novelty wears off quite quickly.

Around the time we were considering buying a flat, we heard that HDB was planning to corporatise, and we suspected that the HDB subsidised loan scheme would be ending. So we decided to take it up before it was really abolished (indeed it is now no longer available for new HDB flat buyers). We were one of the last batch of Singaporeans to get this kind of loan.

So we pay a fixed interest rate of 2.6%. It doesn't rise with the general market. It is pegged to be 0.1% more than whatever the prevailing CPF Ordinary Account interest rate is (that is, 2.5%). This wouldn't have been possible if we had bought a condo and taken a loan from a commercial bank. For these past three or four years, we have been totally unaffected by rising interest rates (unlike those of you who have an outstanding mortgage with Standard Chartered or DBS etc).

I can prepay, in part or in full, my kind of HDB loan at any time, without fees or penalties. But I have never prepaid. That's because instead of prepaying the loan where interest is chargeable at 2.5%, I would rather chuck my excess money (CPF or non-CPF) into investments (it is quite easy to get returns higher than 2.5%).

For example, I've chucked a lot of my excess CPF Ordinary Account money into the CPF Special Account. Instead of using that money to prepay a loan accruing interest at 2.5%, it makes more sense to put it into CPF Special Account where it earns interest at 4%, guaranteed by the triple-A rated Singapore government).

Back to maids. Why do I want two? After careful consideration, I realise that time is the most precious commodity for me and my wife. As lawyers, each of us earns quite a lot of money, considerably more than the average Singaporean. The money is comfortable. Time is what we lack. So instead of using money to buy material luxuries (like expensive holidays, designer furniture or branded goods), we plan to use money (the costs of employing two maids) to buy time.

If this works out the way I envisage - we will hardly ever spend any time on things like cooking, doing the laundry, buying groceries, mopping the floor, ironing, making the bed etc. It may not be fair to expect, or possible, for one maid to do all that well AND look after two young kids. But I think it is a fair expectation, if we employ TWO maids.

Thus when I come home after work, I expect to be able to spend 100% of my time in a quality way with my kids. Or on my personal projects. Same for my wife (except that she doesn't have any personal projects). If I alternate the maids' off days, there won't even be a Sunday where the household will be "maid-less".

Will I need two maids indefinitely? No. Only until the kids get older, and become more independent. That will be in a couple of years' time. Then we'll go back to one maid. And eventually, to no maid. We'll get part-time help then; like a cleaning lady who comes in twice a week to do the housework.

Some people think that doing your own housework is character-building and enriching. I can understand, even appreciate, that philosophy. I know a very wealthy & successful lawyer, a senior partner in Singapore's largest law firm, who thinks that way. He and his wife do all their own housework (and they have kids too). His wife had a car; he rode a motorbike. Bear in mind that he is the kind of person who could well afford two BMWs, or three.

In another way, he is rather unusual. For many years he had no credit card at all. He paid everything in cash - this is his psychological method of stopping himself from overspending. This approach has its pros and cons. This way you will avoid living on credit. On the other hand, if credit cards don't tempt you into overspending, then their usage is actually good, since you collect rebates and points for buying things that you would have bought anyway.

What is the purpose of my long, meandering post? Actually, it is quite simple. I certainly do not claim that my lifestyle decisions, or that senior partner's lifestyle decisions, are best for everybody (in fact, at the start, I already said that everybody's circumstances are different). What I wanted to do is demonstrate that actually, life in Singapore does offer a variety of options.

For example, you DON'T necessarily have to own a car. You DON'T necessarily have to live in a condo. You COULD possibly have a successful career, yet have kids - and quality time for them. You DON'T necessarily have to have a credit card. A country club membership COULD be a stupid idea.

Wow, I just dealt with all of the 5 C's.

Two more thoughts - you DON'T have to have a maid. Or you COULD possibly have two.

Don't be a cow. Drop that herd mentality. Think about how YOU want to live your life, and not how society seems to expect you to live your life.

Technorati: .


Anonymous said...

Interesting to see your thinking process in planning your finances.

I'm curious to find out what made you and your wife decided to keep on working and have 2 maids, instead of your wife staying at home, and taking care of your children.

Anonymous said...

wife is earning good salary, why give it up? (at least not now)

Anonymous said...

US Department of State:

Anonymous said...

Hi Mr Wang!
Your sharings about how you spend your money and time is very interesting and educational. Thanks for sharing these nuggets of wisdom. Indeed, having the 5 Cs doesn't garuntee a happy and meaningful existence :D

I've enjoyed reading your posts on life in general and your insights on the state of political / economic / social affairs in Singapore. Keep on blogging! (^-^)V


Anonymous said...

one of your most interesting articles for a long, long time. :)

For some reason, I've always had the (obviously mistaken) impression that having more than one maid per household is illegal.

But since you 2 lawyers are doing it, it must be OK.

Christopher Ng Wai Chung said...

Mr. Wang,

Your two maids idea is brilliant, although I would question if it'll get a little crowded in your flat sometimes !

Have you also considered paying your mum to help out with your home ?

Maybe you can share with us how you cope with the lack of privacy.

Joseph Chiang said...

if only more singaporeans can think for themselves like mr wang.

for me, i opt to work less (thus making less money) so i can spend more time with my children. the time spent watching them growing up is worth more than anything money can buy. i will never employ a maid as my wife and me decide that we should do everything with our own two hands. i'm fortunate to have a mother to look after my kids while we go to work.

however, i own a car because i couldn't stand rude taxi drivers and ugly commuters i encountered in the MRT on a daily basis. i would have saved more money taking public transport, but until i find Singaporeans start to behave more graciously in public, i don't think i want to take public transport again if i could help it.

and i'm happily living in a 4-room flat. to me, the most important thing is to be happy, and that's nothing to do with the size of your house. i've really never cared about what others think.

i agree with mr wang, you don't need to have everything to be happy. you can have one thing but make do without another, it's all about balancing your life (and book).

Anonymous said...

Regarding MR Wang's comment on HDB no longer offers subsidised housing loan at 2.6% p.a, when was that announced? i believe HDB is still offering it for new flats as well as resale flats.

Anonymous said...

I agree with Mr Wang. My wife and I have twin infants and two maids. We thought of having her quit work and stay home, but only briefly. She is convinced the inactivity would drive her mad (and probably take me with her). We figured that as long as we spend less on the two maids than her net take home pay, we might as well take the plunge. This also allows our parents to swing by the house whenever they want (which turns out to be very often), and allows them to spend time playing with their grand kids. I figure they spent all that time raising us, so no need to work so hard on our kids how.

For me the maids are all about quality of life. They allow us to play with the kids without worrying about household chores. We're worried the children will be spoilt, but against this we do spend alot of time with them. It could go either way.

I also spend more than the regular amount on the maids. After all the disasters I've heard of and seen, I'm hoping that we got quality for the extra cash. Besides, the wife is working...

Oh yes. I got a car and credit cards too! (but no country club)

Anonymous said...

Im an 18 year old here. Mr wang your post is really insightful. glad that i read the whole long post.

Hmm you really kicked some sense into me. People of my generations (16 to 20s) are thinking of owing a car and living in condo even before we got our certificate (another C)....

You are a great influence to an 18 year old. You will make a good father, trust me (if you don blog about the country club, you will be better)

Anonymous said...

It's nice to hear how other Singaporeans are planning their finances around their lives. As for me, I'm relatively new to the workforce, there isn't much my lifestyle is demanding from my piggybank currently but I reckon my day will come.

Thanks for sharing guys.

En and Hou said...

Very sound advice! Any plans to write a book? ;)


Anonymous said...

as a foreigner I have always found it curious how singaporeans depend on live-in servants known as maids. this type of phenomenon is restricted to the elite in many other developed countries yet in singapore I have known taxi drivers who employ maids. this is all made possible by the fact that singapore is an oasis of prosperity surrounded by stark poverty and desperate people willing to work for very low wages. the maids are imported because no local singaporean would work for $350 a month. while it may represent a lot of money to someone from a village in indonesia, is it not unfair to that person who is expected to be on call day and night? is there not something morally questionable about singaporeans opressing their neighbors so they can enjoy their personal projects and quality time with children? I am sure the servants Mr Wang plans to employ would also like a chance for personal projects and quality time. Interested in hearing Mr. Wang's comments on this seeming moral dilemma.

Anonymous said...

there's no "moral dilemma" in singapore. elites screw peasants, peasants screw maids. screw up nation.

Anonymous said...

hi mr wang,
nice article there...
have you considered that since you can afford it, a car also increases your quality of life?
it's easier to get to places far away from MRT (eg mac ritchie, ikea, ECP, zoo etc) or visit relative/friends staying in "far away" town such as sembawang / bukit panjang / pasir ris
and perhaps with a car, you'll visit your country club more often!


Anonymous said...

Mr. Wang counsels well, indeed.

But the thing is - and this is no fault of Mr. Wang's - ultimately, it seems that sustainable living in Singapore is a matter of making sacrifices and compromises, sometimes rather substantial ones.

Let's take the example of Mr. Wang's family. It enjoys (very substantial) double income, earned by two relatively senior lawyers. As far as earning power is concerned, Mr. Wang's family is probably upper middle class.

And yet, his family still finds the cost of owning private property or a car to be prohibitive.

In many other developed countries, e.g. Australia, these things would be considered commonplace, everyday items that every family can aspire to.

But in Singapore, they've become luxury goods.

Maybe the ideal solution is to emigrate somewhere where one does not have to make so many compromises and sacrifices.

And why do we even want to make such sacrifices and compromises to begin with? What do we receive in return? The privilege of serving NS? The transcendant experience of being subject to CPF contributions?

It seems that the only people in Singapore who do not have to make such sacrifices and compromises are those who are at the top of the food chain in this country.

And considering that the System seems to operate almost exclusively for their benefit, that the ordinary Singaporean has to slave away for them and that those people have not shown any inclination towards greater equality or social inclusiveness...why are we bothering to hang around this place?

Anonymous said...

Mr Wang

Upfront I'll say that I'm residing in Australia where maids are not really part of the domestic scene because 1)the immigration rules discourage foreign domestic workers and 2)employing a live-in maid is bloody expensive (and of course pt 2 is related to pt 1).

In a sense, Singapore families are 'luckly' as they, especially if they are from the upper middle group, have the option of employing maids. Often, my wife and I have entertained the thought: how nice it would be to have a maid to do some of the household chores and look after our young children (I think our house could easily accommodate a few maids). But because we don't, we have to work round our time, like my wife working flexi-time and I getting home from work by six each day.

But I really like one of Mr Wang's reasons for hiring a second maid -division of duties. One maid for looking after the kids and another to do the housework. That's the way it should be. I think some people in Singapore (from some articles I've read) treat their maids as menial slaves, expected to do everything around the house -child-minder, cleaner, house chef -and all for the paltry sum of $320 a month (though that might be a lot in the countries from which the maids come from).

So in this respect, Mr Wang is a very humane employer.

Anonymous said...

I really would like to ditch my car, but unlike you, I don't stay near a bus terminus or MRT station. Taxis? Many a time have I jumped into my car and driven to the airport instead of waiting 10 minutes for the computerised booking only to tell me no taxi is responding to the call. My kids used to take a private bus to school and had to leave home as early as 5.30 am as the driver has to pick up 12 other kids. Now I drop them off, all three of them, each at a different school, within half an hour. And the grocery run; can't imagine how to manage that without my own vehicle. Emergencies - when the kids were a year old or two, it was not uncommon to rush to the nearest clinic or hospital at the dead of night for the raging fever. On two maids: one for household work, one for baby sitting. Seriously suggest you drop the latter. Have seen my brother's situation with same - second maid end up as mother substitute.

Anonymous said...

I like your fundamental point, Mr Wang. We should live our lives according to our priorities and choices and place the parameters around it.

I, for one, am a working mother of 2 young infants. I've got maids and a mother who looks after them when I'm at work. Everyday I read an article about the benefits of a stay-at-home mum, I feel guilty and harassed. Perhaps I should stay at home. Perhaps I should not be so selfish. Perhaps my career and sanity should take a backseat now that I've got kids. Stay-at-home mums rave about the precious times spent with their kids that can never be replaced. It still worries me that I can't make that sacrifice because I can't stay at home. I know I'll go stark, raving mad and frankly, the extra money works for me as well. A little luxury here and there, a massage, a facial, some nice dresses for the babies, a new designer handbag. It's all more affordable. My husband probably can indulge my lifestyle but nothing like earning your own keep and spending your own money.

So, lawlipop. There are women out there who don't want to stay at home. Even if they can afford to. It's a personal choice. Work establishes our self-esteem and we relish the financial freedom as well. So, it was my choice to be a working mother.

I'm not sure if this is the reason why Mrs Wang works.

Having said all that. I still struggle with the guilt and the feelings of inadequacy (as a mother). I'm pretty certain there are a lot of working women out there who go through the same dilemma day in and day out.

So I've made my choice but still struggle to establish the parameters properly. The mental parameters.

Anonymous said...

I did not know how little a maid is paid until I read that ST article. It was a bit displeasing to see how a single person is expected to do all the housework, take care of children, and more for so little money.

Meanwhile, a double income family many people regard as well off considers the costs of a condo and car too high for the benefits they bring.

Human life is cheaper than a car!

Some rich guy knocks down a maid with a Mercedes Benz. The maid's employer says "pay for my maid!". The rich guy says "Sure, if you pay for the damage done to my mercedes!". The family check the costs, and says "ok nevermind, maid is cheap".

NB the above situation is purely imaginary

Joseph Chiang said...

everyone should watch this short film by eric khoo.


Anonymous said...

Hi Mr Wang

Thanks for sharing! An interesting insight that has gotten me thinking about my own family life.

IMHO, the crux of your sharing is really about going through the options, making the choice and accepting the consequences.

Many folks, me included, at times will lament "I've no choice but ... (fill in the blanks)!" But really, it is about the unwillingness to accept the consequences of choice and move on.

The word consequence also means result; whether it is a good or bad consequence is up to the individual.

PanzerGrenadier said...

I share the sentiment that as individuals, we need to think through our options, weigh different priorities and decide what we want and accept the consequences.

I have been working for 11+ years and have never owned a car. I have driven my family's old Daihatsu charade for 1 year before it was scrapped but that was all the car "ownership" that I enjoyed in my working life.

I have met employers who looked me up and down incredulously when I told them I don't own a car. They cannot fathom the concept of a professional who can afford a car not wanting to own one.

My father-in-law hinted to me a couple of times that "cars were cheap".

I am fortunate that my parents grounded me in being frugal and not to keep up with the Jones' (or in our case the Tans and the Lims).

Our public transport works reasonably well IF you live near the hubs/stations and if your commute is covered by an existing bus/train route. However, ulu locations still necessitate 2-3 transfers which are a pain.

Saving money and being financially free is possible in Singapore. You need to be very focussed to pay off debts, invest (wisely) and to live way below your means so that we can become accumulators of wealth (and not debt!)

Lunatic Fringe

Anonymous said...

While it sounds practical to have two maids (since u can afford it) to free up your time to spend with your kids...I can't help but wonder how this type of arrangement really affects children - not having to make their own beds, wash their own cups, plates, carry their own school bags, etc. No need to do chores or help mum or dad around the house cos there are 'other kinds' of people who do these types of menial jobs and whose responsibility it is to look after their needs. Hmmmm...

Anonymous said...

Just crossed my mind to ask. Do you or your Mrs have a driving licence?

Anonymous said...

"With your salary (and your wife's) I think it would not be too hard if you sponsor them for some continuing education program locally."

That will advance the career prospects of the maids. Who is Mr Wang going to exploit then? Nah, keep them down. Can't handle the brutal truth? Mr Wang will kick you in the groin!

This is your last chance. After this, there is no turning back.

You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe.

You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes.

Anonymous said...

Just curious, which one has driving license, you or your wife?

Chris said...

Mr. Wang, you're post is very insightful and having been in perth for 3 years, I understand what you mean by quality of life, having time to spend with your loved ones is a blessing that even some rich people don't have.

However, I wish to point out something. If everyone in Singapore (esp degree holders and above) were as easily satisfied as you, than PAP would have a very good job.

Yes its true, you can survive without a car, but a car adds to quality of life. If people of your status don't drive, then who is supposed to?

Learning how to be content with a person's current status quo is a very valuable asset, but don't give PAP such an easy time for heaven's sake. Our ministers are among the highest paid in the world.

It's like alot of the young and highly educated people live in flats and are content to take buses and mrts. There has to be more than that, I'm sure.

If everyone was as easily satisfied as you, PAP would never bother to improve things.

I hope my post wasn't offensive in any way. None was intended.

Anonymous said...

While I am not the intended recipient of the message, Chris' comments nevertheless strikes me as very very odd. It seems to imply lawyers and other supposedly affluent people ought to drive cars, and they ought to have a better quality of life.

I don't think just because everyone starts to demand a "better" life, the government will be hard pressed to meet our demands. That only happens in democracies(oops) and even then, not every time.

"Better" quality of life is ultimately subjective. I follow the "whatever I think works" school - if one day I feel a car would be nice I'll get one, but until then I'll take the train.And even then I may decide the car coop scheme would be sufficient for a "better" quaility of life.

Whatever works.

Anonymous said...

just take the BLUE PILL. you do not need a car. you do not need landed properties. your descendants can live on this island forever. life in singapore, is good.

take the BLUE pill.

Anonymous said...

You think Mr. Wang is nice guy? He won't exploit maids? LOL. Mr. Wang used dead SingaporeSerf just to prove his point. You guys DON'T KNOW Mr. Wang.

hugewhaleshark said...

Excellent, Mr Wang. This is what I call specialization of labour. Your maids don't do legal work, you don't do housework. : )

Couple of points though:

1. Owning a modest car isn't all that much more costly than employing a maid. Employing and feeding a maid for ten years costs, what $800x12x10=$96k plus $2-3k on agency and other fees depending on how often you change maids = about $100k total. Having a car for 10 years will cost say $10k upfront + $600 per month for 7 years + $500 per month upkeep = about $120k. The difference in cost is less than $170 a month. Little enough to make it a sane lifestyle choice.

2. I have said before on my blog that we will be able to pay our maids a lot more if not for the maid levy. In effect the gahmen has taken a cut of the maid's economic value. That hurts the employer because he cannot compete with HK/Taiwan for good help.

Ironically I am not sure it hurts the maid because they always have the option of going to HK/Taiwan when they have gained the credentials. There is a spectrum of wages for a spectrum of work quality. Maids are paid, what $600-800 in HK/Taiwan, $300-400 in Singapore and RM300-400 in Malaysia. The ones who work in Malaysia come from really rural areas whose lots are more unfortunate. But it is still a free market.

Anonymous said...

While the maid is here helping you so you can have more time to spend with your children to make sure they grow up right, she is not spending time with her own children to make sure they grow up right.

Anonymous said...

Not having a car would save a lot of money.

Personally, i do not need a car as i am working mostly in the office as a purchaser.
There is company provided transport to and from work.

In one blog by colbalt paladin, he did mention that a car in ten years time would be a worthless piece of scrap. Hence, it is more sensible to own S$100,000 dollars in the bank than a piece of scrap.

Well to each his own rite.

On the matter on maids, yes it is difficult to get good maids nowadays.

My experience with maids left a sour taste in my mouth.

My first maid was from the philipines back in 1997 and when we requested her simple cleaning of the floors and laundry, she did not know. Moreover she accused me of trying to rape her. Seeing her ill intent, we sent her back.

The second maid which we had gotten had a split personality syndrome. and almost took my niece and tried to commit suicide with her. Called the police and sent her back.

Nowadays, i hire a house cleaner who would come in once a week to do laundry and clean and mop the house. She is a singaporean about 44 years old who was retrenched and is a neighbour. we pay her about S$10.00 an hour for her work and this agreement work out fine.

Therefore, actually i can see a potential market for hiring house cleaners which can do some tasks part of the week during the weekends. If you trust her, i gave my neighbour my housekeys for her to come over clean.

Just my 2 cents worth.

Chris said...

Ok, since my comments come across as odd, I shall rephrase myself.

I might draw some criticism for this outright comparision but overseas, for a household of two lawyers to NOT drive a car. That is quite a social abnormality. Heck, people who are way below that level drive to work everyday.

I know I know...cost of living is not the same at all, cannot anyhow compare etcetc. I accept that in Singapore not everyone is meant to own a car, I accept that if everyone owned a car, riding a bicycle would be faster than driving.

However, I believe people of MR Wang's stature can afford a car and although its not a MUST, I can't imagine having his household income and taking public transport to work. (Yes, he earns alot more than me for sure). I mean can't be two lawyer's put together can't afford a Kia Picanto?? If he says he cannot afford, I definately don't believe.

I don't believe after working your life away and becoming successful, people of Mr. Wang's stature should just be content with a 5-room flat and taking the MRT. Yes you won't die, but I'm sure there is more to it than that.

If you think by doing that you could be happy, then i suggest you move overseas, because you can have your cake and eat it too. Much much happier. Heck Mr. Wang could have time for his kids, he could have two cars and he could most definately retire early (at least earlier than sg) in style and watch his kids grow up.

Anonymous said...

"I don't believe after working your life away and becoming successful, people of Mr. Wang's stature should just be content with a 5-room flat and taking the MRT. Yes you won't die, but I'm sure there is more to it than that.

If you think by doing that you could be happy, then i suggest you move overseas, because you can have your cake and eat it too. Much much happier. Heck Mr. Wang could have time for his kids, he could have two cars and he could most definately retire early (at least earlier than sg) in style and watch his kids grow up."

You will believe anything if you take the blue pill. Go on, you know you what to.

This is your last chance. After this, there is no turning back.

You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe.

You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes.

Whispers from the heart said...

Mr Wang, would like to share this:

When my son was 5, we went for our first overseas holiday. Stayed in a hotel and ordered room service ...

The first thing he got back, he asked if we could also have room service at home and that he need not do his bed.

No such thing for me, as he grow older, we even rostered to cook for the family! (we didn't mind if he made sandwiches and stuff)

It's ok to have maids but important to strike a balance so our kids learn the value of hard work and contribution as a team. Paying someone to do the dirty job is not always the solution.

Anonymous said...


Anonymous said...

Gong Jiao Way - Talk Cock the PAP Way
Wee Siew Kim apologizes for his apology ... Strange, I thought Mr Wee also implied in his earlier apology that people should be able to stand by what they say?

Anonymous said...

If not for the security concerns that a locked door affords, I wouldn't even need a roof over my head. I really wouldn't mind living in an HDB void deck for example, or underneath the stars, given a sleeping bag and a wireless internet connection.

Anonymous said...

If your wife can/will do her chores and cook, there's no reason to get a maid at all.

Unfortunately, many Singaporean men willingly married bitches who can't/refuse to do simple chores or cook simple stuff, and whom instead would rather be a super married careerwoman.

These women's idea of a good motherhood is dumping kids at childcare centres, then letting maids/ the grandparents pick up the kids after school.

I fail to see why men who ended up in such a predicament need to whine about getting a maid. You reap what you sow.

For those who say that 'hey the wife earns a lot/earns more than me so she shouldn't be hanging around at home and instead she should work' I say this:

If I needed to earn more money, or have additional disposable income, I wouldn't have got married in the first place. Or at the very least, not marry a woman who will do the earning at the expense of neglecting more important issues.

Anonymous said...


Sunday October 29, 11:46 AM

Minimum wage rise is reasonable: Andrews Workplace Relations Minister Kevin Andrews has defended last week's increase in the minimum wage as fair and reasonable in the prosperous economy. ...
"We are in a prosperous economy at the present time ... as I go around the country, wherever I go, business owners and proprietors say to me we simply can't find the number of people we need to do jobs." ...

Anonymous said...

i guess it's a choice every family has to make...to be a dual income family with external third party bringing up the kids or single income family with mum bringing up kids.

I tried the former for 4 years. But was never comfortable or happy with the situation. I eventually gave up my job (which was tough because it was a good job and I loved it) to spend more time with my child. But must admit it was difficult to do so in S'pore. Standard of living too high to enjoy a certain quality of life.

So, we returned to my hubby's home country this year (living in the suburbs of one of the most expensive cities in the world - Tokyo), and we are more than comfortable living on just his salary and enjoying a full and happy life (note that in Japan it is quite common to be given 6 months or more as annual bonus and govt subsidizes 70% of healthcare costs). Makes it easier to be a stay-at-home mum.

Anonymous said...

I'm surprised all of you seem to think that whether or not to get a car is an affordability and lifestyle choice. Have none of you heard of global warming? Getting a car is just as much an ethical issue. Go watch An Inconvenient Truth.

As for getting a maid, I suppose as long as the terms of employment and working conditions are not unreasonable, I've no issue. Unfortunately, some employers take the view that they are entitled to treat their maids inhumanely (as long as it is within legal limits in Singapore). That is economic exploitation; it's simply taking advantage of the fact that people are so poor they cannot afford to uphold their dignity.

And Chris mentions that if everyone were contented, the PAP would have an easy time. I disagree. If everyone were contented, the PAP would have no hold on us and would not be able to bribe us into electing them into power. That would make Singaporeans harder for them to control and manipulate.

Anonymous said...

"They must, instead, stay and make a difference."

I see our sons serving the armed forces while the children of complete strangers studied for free to help widen the difference.

I see how we're treated different from the talents from beyond the seas.

I see difference when deciding who should die & who should live. Who should have lifts at their doorsteps while others should climb.

I see how we must justify our actions, our spendings, our lives, to produce results, so as to keep our jobs, our happiness, our freedoms.

I don't see a lack of difference at all...

Yet, to most, we can only respond with dejected INdifference...

INdifference to what is the acceptable difference.

This nation is like a ship...alas a sinking one.

Call us lowly rats,

but who can blame the rodents that abandoned a floating wreck?

Anonymous said...

Peasants paying these jokers more than $100,000 a month to spew crap like this? seriously!?!


“Retrenchment is good for singapore. If there is no retrenchments, then I worry.” - SM Goh

“I don’t think that there should be a cap on the number of directorship that a person can hold.” - PAP MP John Chen who holds 8 directorships.

“It’s not for the money because some of the companies pay me as little as $10,000 a year.” - PAP MP Wang Kai Yuen who holds 11 directorships.

“If you want to dance on a bar top, some of us will fall off the bar Top. Some people will die as a result of liberalising bar top dancing… a young girl with a short skirt dancing on it may attract some insults from some other men, the boyfriend will start fighting and some people will die.” - Vivian Balakrishnan, Minister for Community Development, Youth and Sports

“I would want to form an alternative policies group in Parliament, comprising 20 PAP MPs. These 20 PAP MPs will be free to vote in accordance with what they think of a particular policy. In other words, the whip for them will be lifted. This is not playing politics, this is something which I think is worthwhile doing.” - SM Goh

“If you sing Jailhouse Rock with your electric guitar when others are playing Beethoven, you are out of order. The whip must be used on you.” - SM Goh again, on a dramatic u-turn, rethink or backtrack, whatever you call it.

“Save on one hairdo and use the money for breast screening.” - another gem from Lim Hng Kiang

“We started off with (the name) and after looking at everything, the name that really tugged at the heartstrings was in front of us. The name itself is not new, but what has been used informally so far has endeared itself to all parties.” - Mah Bow Tan on the $400,000 exercise to rename Marina Bay as Marina Bay.

“Having enjoyed football as a national sport for decades, we in Singapore have set ourselves the target of reaching the final rounds of World Cup in 2010.” - Ho Peng Kee

“Only 5% are unemployed. We still have 95% who are employed.” - Yeo Cheow Tong

“Singaporean workers have become more expensive than those in the USA and Australia.” - Tony Tan

“People support CPF cuts because there are no protest outside parliament.” - PM Lee

“No, it was not a U-turn, and neither was it a reversal of government policy. But you can call it a rethink.” - Yeo Cheow Tong

“…I regret making the decision because, in the end, the baby continued to be in intensive care, and KKH now runs up a total bill of more than $300,000…” - Lim Hng Kiang, regretting the decision to save a baby’s life because KKH ran up a $300,000 bill

“Without the elected president and if there is a freak result, within two or three years, the army would have to come in and stop it.” - MM Lee Kuan Yew

“Please do not assume that you can change governments. Young people don’t understand this” - Minister Mentor Lee Kuan Yew, post-2006 General Elections

Anonymous said...

I have a couple of maids.

One is a single mother and uses the money she earns to put her two sons through university. We pay her a good deal more than S$350 a month because we agree with what she's doing, and why.

Let's not lose sight of the fact that the maids we employ come from very poor communities. Many come to Singapore in the hope of earning their children an education, and the opportunity for a better life.

How these women are treated when they are here is really up to the employer. If Singaporeans really are treating their domestic helpers inhumanely, then that's more likely a problem with roots in the Singaporean society and education system. Having said this I think (hope?!) only the minority of Singaporeans are really nasty to their maids.

Anonymous said...

"Unfortunately, many Singaporean men willingly married bitches who can't/refuse to do simple chores or cook simple stuff, and whom instead would rather be a super married careerwoman," ... you're missing the point.

I married one of your 'Singaporean career bitches.' Overseas she'd have had to quit work, but here, maids are affordable and there are more options. To me it doesn't matter if she works or not. How this impacts the family is something we are watching, and will respond to.

Anonymous said...

Quoted from the anonymous poster of October 29, 2006 5:17:00AM : "Unfortunately, many Singaporean men willingly married bitches who can't/refuse to do simple chores or cook simple stuff, and whom instead would rather be a super married careerwoman."

Wow you infidel bigot. They're reaping what they sow for marrying women who have careers, rather than faulting the men for not at least helping do half of the chore workload themselves?

"For those who say that 'hey the wife earns a lot/earns more than me so she shouldn't be hanging around at home and instead she should work' I say this:

If I needed to earn more money, or have additional disposable income, I wouldn't have got married in the first place. Or at the very least, not marry a woman who will do the earning at the expense of neglecting more important issues."

If a spouse earns more than the other spouse, then methinks it would be actually pragmatic for the other spouse (the man in this case) to do the household duties, no?

Your argument is uttterly fallacious and flawed. I can spot two logical fallacies in there. Shall I enlighten you?

Anonymous said...

*clarification to my last post

You say they're reaping what they sow, but you're not faulting them for not doing at least half of the workload themselves

Anonymous said...

Concerning cars. For one, I must really agree with government propaganda (though there is a hilarious comic strip about how the LTA is campaigning in vehicles ... to ask people to stop using private transport) this time.

Are cars even worth it for "weekend" or "social" purposes? As a student, one knows the joy of travelling all over the country on a shoestring budget, nearly taking the MRT from destination to destination almost, just to hang about. It's hard to fit a dozen friends into a car. It's no problem to bring them along the train.

My relatives carpool amongst themselves - the entire extended family shares two vehicles - one is an SUV, one is normal car. Seeing that we're five different households united by one, often the vehicle comes in handy when one is running very late, or one needs to perform at a music recital and lugging about a saxophone case in the MRT would be inconvenient or other quick-fix solutions.

After all - a vehicle is most efficient that way - rather than having it parked unused for most of the day, or sometimes totally unused, it is used for the maximum benefit.

Why would one need to go to a social event by car in most cases? To "arrive in style"? (Only to have to do the unglamourous thing of looking for a parking lot.) If one has a car, it should at least be shared among households.

Our extended family shared our maids too. Our household by itself isn't that well off, but when pooled among our extended family these things do become affordable. But of course, now I'm in the US and there isn't such a thing.

Anonymous said...

Joshua Says:
October 20th, 2006 at 2:17 pm
I am living and working in Australia for a few years now. To me, the line between a Singaporean and an Australian has blurred. Perhaps, it is because I stop questioning or justifying myself.

My existence, whereever I am, is more important.

Perhaps it is due to the freedom of an Australian to live anywhere in the world they like and still consider themselves Aussies. I can still “return” to Singapore to visit family, etc.
I have a choice here, Australia recognise dual-citisenship and it benefits Australia to recognise the age of human and skills mobility.

I think the idea of “leaving one country” is in a way, quite Singaporean, because of the narrow focus drawn by the politicans for their agenda.

Perhaps, I am living in a lucky country, where one do not measure life with material well-being. Many Singaporeans settled in Australia, then left Australia again, disappointed by what they see. Some of these people find themselves in a quandary, because having seen Australia intimately, the Singapore they imagine is no longer the one they left behind.

Utimately, a Singaporean who chose to “leave” Singapore should have a few tips to help achieve his or her dream.
1. If you hate or dislike Singapore and as result, leave Singapore, you will not like your new adopted country. Leave Singapore happily. Say bye-bye to the suckers who run the country like a profit-maximising corporation.

2. Look beyond the surface. The grass if not always greener on the other side. Have a realistic expectation of the country you are settling and recognise the points that will help you to thrive. Australia is beautiful because it is imperfect and human-oriented. We have our share of problems, but that is part of life.

At the end of the day, the best words you will ever hear is when your kids (after visiting Singapore) came around and say “Thanks for bringing us to Australia”

Anonymous said...

Why I Would Like to Leave, by Kitana

Before I went to Canada for a year, I had to go for a medical check-up. During that check-up, the doctor told me that I would love Canada. And he had said that most of the people he knew that went to Canada, either never came back; or when they did, they’d returned to Canada shortly after. Few ever stayed in Singapore.

At the time, I wondered why. I don’t anymore.

The government asks us why we leave. They calls us quitters and deserters, for leaving our country, our homeland, for some other place that we perceive to be greener pastures. Why leave Singapore, where we rank tops for good governance (save for voice and accountability, where we scored a low of 38.2% this year), where we are so clean and safe and secure, and where we are so efficient?

The fact of the matter is, that there are people who will give up all of the above, for more freedom.

I was happy in Canada. Sure, it was expensive, and taxes were a killer. With a 14% combination of GST and PST on all consumer items, and income taxes hitting a high of 40%; it was definitely difficult to make ends meet for someone who did not work there. And of course, on days where the buses went on strike, I’d be stuck in campus and not be able to go to town. Also, we did have a bit of a furor when Parliament was dissolved late last year, only to have the Conservatives voted in after 13 years under the Liberals. Oh and before I forget, yes it was definitely more inefficient. Expect to wait when you queue up to pay for something; the cashier will inevitably engage everyone before you as to how their day was (and their kids, and their parents, and what they think of the weather; etc). Expect to wait for the buses because the bus driver might have stopped somewhere to grab a cup of Starbucks while doing his rounds (yes, with passengers in the bus). Oh, and how can I forget the drug problem: you can get drugs anywhere off the street if you know where to look; marijuana is about as commonplace as cigarettes and alcohol.

But for all the possible gripes that I might have about that place, the benefits far outweighed all the detriments (if you even saw them as that) combined. Firstly, we were really free. I’m not just talking about freedom with regard to political freedom to vote, to protest, to strike, to demonstrate, or to have a point of view; but also real freedom of the mind and the body. You can think differently, dress differently, live differently. Society is inclusive.

The city that I lived in had a whole mix of races and nationalities. I’ve met everyone from locals to the Koreans, Japs and Chinese, Iranians, Iraqis, Philippinos, Latin Americans, French, Africans, Indians etc etc etc. It’s as much a cultural mix, if not more so, than Singapore. And the best part is: everyone more or less gets along. There is no need for the implementation of “Racial Harmony Day” or racial quotas for HDB flats. Everyone just does – because prejudice just does not exist there.

And it wasn’t just about race and religion; you could be a conservative or a liberal, be it cerebral or waist-down. It didn’t matter. Such criteria was just not a measure of your worth. You could be thin or fat. It didn’t matter too. People weren’t as image-conscious. You could walk down the streets dressed in goth punk outfits with multiple piercings in your face and people would still talk to you normally, and not avoid you. And in Village area, men held hands with men; they kissed on buses, and no one even batted an eye lid.

In Singapore, can you comprehend this inclusiveness? The majority of Singaporeans are notably close-minded and inflexible. Even if a straight couple were to kiss on the bus, there would be chitters regarding the offensiveness of public displays of affection. When the gay community wishes to throw a party, they get turned down because the overly-conservative majority decides that this is a justification for the prevention of AIDS. Singapore is one of the few countries, if not the only, where drug trafficking attracts a mandatory death penalty, such that the courts do not even have the discretion to pardon the poor 18 year old Nigerian who became a drug mule without him realizing the folly of his error.

If you decide to stage a demonstration, you require a permit that will always be turned down on the vague notions of security; if you support a party other than the one in power, you risk getting asked for your particulars and photographed. If you hold a view other than the one in the local papers (which is so effectively-controlled, all for the sake of “the national interest”), you are forced to keep that view to yourself. If you attempt to post that view up on a platform, such as a blog, you might be sent a warning letter especially with a threat of defamation. If you decide to print out that view and distribute it on a phamplet, you may get investigated under s 151 of the Penal Code. Oh, and you can’t do podcasts with political content, unless you are the party in power.

In Singapore, besides the overwhelming humidity, there is a notorious lack of personal space. There are too many people in Singapore. It’s so difficult to find a place which isn’t swarming with people. The roads are full of cars, the buses are packed to full capacity at various times of the day; Raffles Place strikes me as a factory churning out goods as people chope seats with tissue packets on busy lunch hours. And everyone is always in a rush. There is always this inane need to do something, be somewhere, get caught up in this inexplicable rat race, and just work and work and work until you succeed… and then realize that you don’t even know what the fuck ‘success’ really means.

The stress is crazy; the pressure unfightable. It starts from the time we enter primary school; the education system does prepare us for the real world in that sense – we get exposed to pressure cooker type stress and a level of competition that makes having a life outside of academia almost impossible, unlike in other countries whose universities also produce Nobel laureates. Our parents push us, our schools push us; society pushes us… And our goal is this:

Money. Money and the economy.

In Singapore, this is the definition of the good life. Some people may subscribe to religion as what defines a good life, particularly in reaction to the imposition of money as the new god; but for the most part, Singaporeans are a consumeristic and materialistic lot. So many girlfriends see the Mango and Zara sales as the defining point of their lives; or believe that sipping lychee martinis at Zouk Wine Bar is the epitome of class. Everyone wants to get more money, buy more items, be more powerful; be it career success or material possession, this is all that most Singaporeans dream of and spend their entire lives clamouring towards.

And this works great for Singapore, because all of Singapore’s objectives are geared towards only 1 thing and one thing alone: money. Or in the case of this country, the economy. Everything we do, we do it for the sake of our economy. We have no minimum wage; we have no protection against the ills that globalization necessarily brings us. We have no protection for the rising income equality (all we have is an article in the newspapers telling us to disbelieve the Gini-coefficient), we have no solutions for our elderly except to either dump them in Johor or Batam, or to encourage our young to bring more babies into this pressure cooker life.

Someone told me that this was not a bad thing. Because we have different races and religions, the economy is the one thing that can unite us. I told him that he was a mere subject of years of successful indoctrination. He talked like just another average Singaporean.

“Money unites us.”

In a country where I would like to live, it is not money, but dreams that unite. Dreams that transcend the material; dreams of ideals of maybe caring for a family; caring for the environment within which we live; dreams of bettering oneself, or dreams or learning for the sake of learning; dreams to be whatever I want to be; that unite people.

In Singapore, it is difficult to dream. Difficult to dream of anything beyond the material. I don’t wish for a future where I am stuck in my dead end job wondering what the fuck I want in my life. I don’t want a future where I die to myself, murder my idealism and my dreams of being different, simply because ‘different’ is a bad word in Singapore.

And because Singapore is not a place where such dreams flourish, Singapore is just not a place where I envision myself realizing these dreams.

Anonymous said...

Finally, as regards to the entire ethics of maids thing, I too was initially appalled when I first returned to Singapore. Perhaps it's just the nature of shrugging it off, but I think we're doing more good than harm by employing them.

After all, the economies of the place they send money home to is different from Singapore. My extended family had a maid who was in fact, studying for her Masters and decided to take up a maid job for a few months' contract while school was out because a maid's salary in Singapore paid more than the managerial position she was offered near in her hometown in Indonesia.

Ideally of course, our neighbours should be on our footing, and we shouldn't have people attending to us. Yet, there is so much we can do at one time. There is the irony of maids serving peasants - in that case, should we complain?

But yet, I wonder why we still don't have a minimum wage. (If we did, the maids' salaries would probably skyrocket as well.) Of course, maid's salaries differ in the sense they will likely share the food and residence resources of the household they stay in, hence that compensates somewhat for the living wage rate, but as to Singaporeans in general, it is appalling, that there are those who still earn only ten to fifteen dollars a day. In the US, the minimum wage is around the equivalent of 7-8 SG dollars an hour, and even they complain that's not good enough because a "living wage" should be the equivalent of 15-16 SGD an hour (however a lot of this goes into rent, which most Singaporeans generally don't have to deal with ...).

Why does Singapore still not have a minimum wage?

"however, i own a car because i couldn't stand rude taxi drivers and ugly commuters i encountered in the MRT on a daily basis. "

Never had such a problem. For one, the main thing about the MRT is how everyone looks uncomfortably at each other but refuses to speak. I'd want any conversation - rude conversation even - than the knell of silence!

Anonymous said...

to that same anonymous again: the purpose of having a reason of not needing a maid at all - would be to save money, would it not? I don't get your logic.

Would then giving up a lucrative job to replace the job of maid in fact cost more money?

I'm not talking about nurturing the child, because often that is outside the scope of a maid's duties as well (though it might be the maid happens to be studying Calculus also, which might not be that uncommon). In terms of just housekeeping, there would be no reaason to trade staying at home for not having to pay for a maid.

A lot of children in fact have rather close relationships with both their parents and their maids (ever seen the compos of RGPS students). But granted, parents cannot replace their duty of raising the child with a maid ... as I recall there was an RGPS teacher five or so years back who gave a student an "F" for an otherwise in fact intensely descriptive and perfectly grammatical composition because it described in quite gleeful terms how the student abused her maid.

However, I don't think that's what most people deploy their maids for anyway.

Anonymous said...

Wang Wang, senior partner is not that senior lah, only like 42 or 43 this year.

Anonymous said...

YouTube on Mr Brown


1 Country, 2 Systems

Anonymous said...

Hi! When was it you purchased your HDB flat? I got my resale just earlier this year at the same rate. 2.6%. Have they done away with it ever since??

Gilbert Koh aka Mr Wang said...

I think I got a bit mixed up. There was another HDB loan scheme (HDB market rate housing loan scheme) which has since been abolished. Used to be that if you did not qualify for HDB concessionary loan, you can take the HDB market rate mortgage loan. That's gone now - instead you have to go to the banks. Key difference is that banks WILL seize your flat and turn you out, if you default.

I was thinking of HDB market rate mortgage loan because I nearly had to take that up. At that time (around 2000), my wife's and my combined salary exceeded $8,000 and so we would have been disqualified from the concessionary loan scheme. Furthermore we would have been disqualified from $40,000 grant for first-time buyers living near parents.

My clever wife quickly resigned from her job and so we were able to honestly declare that our combined income in that month was less than $8,000 (since she was jobless, her income was zero, while I was earning less than $8,000 then).

After all the paperwork was done, and we had got our $40,000 and 2.6% interest rate, my wife looked for a new job and found it in less than a month.

Anonymous said...

What makes you fascinating is that you embody the Singaporean who has his 5 C's, but act like you are so unique and different from the rest.

I believe that when we talk about the 5 C's, people dream of having the means to have them, but when they get to that point, not everyone may actually spend the moneyon the 5C's. You may not actually have the 5 C's per se, but as you frequently point out, you have an enviable income and have traded one or two C's for other luxuries. So what's your point? That it's wrong for other Singaporeans to hanker over the 5 C's unless they have no Car, and more Cash?

You want a maid for the same reason that people get cars. For the convenience, and because they think the time spent paying for the maid or car could be used to make money, or to spend time with their family, or to do more work.

I'm not sure that getting 2 maids is as simple as a lifestyle choice thing. For a start, are you giving these two maids their own rooms, or do they now have to share? When singaporeans hire maids with the intention of asking them to leave after a certain time period, do they consider the effect of this on the maids, who have to borrow extensively to come here? Also, your children will be brought up having two maids waiting on them. How will they adjust to having to eventually hang out clothes, mop the floor and clean the toilet themselves?

While most people in western countries have a car, they seldom have maids, preferring instead to adopt a hands-on approach in all aspects of their life. That includes cleaning and fixing everything in the house themselves.

Gilbert Koh aka Mr Wang said...

1. Oh, you may find me fascinating, but pls note I am not recommending my lifestyle to you or anyone else. See next post - "Karmic Biscuits".

2. On 5 C's and related issues, I have some old posts, you can use my search engine to see my views on those.

3. Maids' standard contract is for 2 years. I think that if maid and employer are ok with each other, there is a moral obligation to stay with each other for at least that long.

4. Kids & chores - read my post again. As they grow up, I intend to shift from two maids to one maid to eventually no maid. Right now, it's not feasible to expect my kids to mop the floor, because the mop is longer than they are tall.

5. Yes, maids & house servants are common in Singapore, Hong Kong, Taiwan, Malaysia, Kuwait, UAE, Thailand etc but not in Western countries. I agree with you.

Anonymous said...

"For example, I've chucked a lot of my excess CPF Ordinary Account money into the CPF Special Account. Instead of using that money to prepay a loan accruing interest at 2.5%, it makes more sense to put it into CPF Special Account where it earns interest at 4%, guaranteed by the triple-A rated Singapore government). "

I don't understand how this arrangement makes more sense.Surely the principal sum of your loan is much higher than the figure in your special account, which means that whatever earnings you make from special account shouldn't be able to match what you are incurring from the 2% interest. Moreover, even if you manage to grow the money in your special account, is it possible to pay off your loan from this account?

Anonymous said...

I think the maid needs to stay a longer time than 2 years to truly break even and then make the profits that justify living a life of serving a family who will probably not remember her ten years down the road.

You've brought up contractual agreements, very business-like, very Singaporean.

You're not explicitly recommending your lifestyle to others, but you're saying that being rich, having two maids, no car and staying in a flat is world apart from hankering over the 5 C's. To me, it's like Tomay-to, Tomah-to.

Gilbert Koh aka Mr Wang said...
This comment has been removed by a blog administrator.
Gilbert Koh aka Mr Wang said...

Aha. Here's a numerical example.

Suppose you have 10 years left on your loan (which is a large principal sum) and your monthly instalment is $1,000. Then suppose you have $12,000 excess cash in OA.

If you prepay the HDB loan with that $12,000, your savings in interest between now and final repayment date would be equal to:

$12,000 x 2.6% to the power of 9

(power of 9, not power of 10, because now you pay up the loan in full in 9 years, not 10).

However if you take the $12,000 and you put it in SA for the same nine years, you earn:

$12,000 x 4% to the power of 9

Which is a bigger sum, yes?

Gilbert Koh aka Mr Wang said...

An American example of the same idea:


Naturally, not quite the same thing, but you get the idea. In fact, because HDB loan is at 2.6%, much lower than the mortgage interest rate in the American example, it would make even more sense not to prepay and to invest elsewhere instead.

Another way to think of it is that HDB has lent you a large sum of money and is charging you 2.6% interest on it.

Then if you do not know how to earn more than 2.6% out of any part of the money that you have borrowed, you should give the money back to HDB as soon as possible (ie prepay).

However if you know how to earn more than 2.6% out of the money in your hands, then you should use that money to go get your higher returns.

One way to get those higher returns is to move your CPF OA (2.5%) monies to your CPF SA (4%).

Anonymous said...

I was the reader who posted this message:
"I don't understand how this arrangement makes more sense...."

While I do not deny that it is possible to make higher earnings from investing the money from one's ordinary account as opposed to serving the HDB housing loan, I would advise anyone reading this suggestion to exercise it with caution mainly because there are many factors at play.
#1, the compounded loan amount v.s the amount invested.
#2, the interest rate of loan v.s. the rate of returns from investment
#3, the duration of your investment v.s duration of loan
#4, risk exposure from the investment

All four factors above must be analysed to arrive at the point where you may actually gain from investing the money.

In addition, you will need to monitor for factors that may adversely impact the optimal arrangement, e.g.change in interest rates.

Not sure if I've covered all issues to consider but the main point is careful planning and calculations must be made beforehand.

Just worried that anyone reading your suggestion will follow suit blindly without much consideration.

Gilbert Koh aka Mr Wang said...

Oh, actually there are other factors which you (and I) haven't mentioned, which need to be considered.

Change in interest rates is actually one of the least likely factors to occur. Reason is that both the interest rates for:

1. the HDB concessionary loan scheme; and

2. the CPF SA account

are legislatively pegged to the same benchmark (the CPF OA interest rate), that is,

the laws & regulations says that the HDB loan interest rate shall be 0.1% higher than the CPF OA rate, and that the CPF SA interest rate shall be 1.5% higher than the CPF OA rate.

In other words, the effect of the law is that CPF SA will be 1.4% higher than HDB loan rate.


By the way, you're still comparing the wrong thing ... You mentioned this as the factor:

#1, the compounded loan amount v.s the amount invested.

Actually you should be comparing:

1. the potential REDUCTION in principal loan amount vs the amount invested.

Note that your usual mortgage loan (including HDB) does not behave like a credit card debt.

The monthly instalment is fixed (eg at $1,000); it is just that at the start of the mortgage period, that $1,000 is mostly interest payment and just a little principal repayment; then this keeps adjusting itself gradually month after month, over the next 25 years, such that eventually the last few $1,000 payments are mostly principal repayments and just a little interest.

In other words, unlike your credit card debt, your HDB loan amount does not "compound". The principal amount only goes down over the years - the question is whether you want to make it go down faster (by making prepayments), or whether you want to take your excess money and invest it elsewhere (with the aim of generating returns higher than 2.5%).


Really the biggest thing to be considered is that if you transfer money to your CPF SA, you can't take it out till your retirement. While you can take CPF OA funds out for certain limited purposes such as buying property or making mortgage payments; or as a loan to your children for their university education, you CANNOT use funds in your CPF SA for any such purposes. They are really meant for your retirement.