Do you know how to invest wisely?

There’s a fine line between optimism and ignorance. We love investment of any kind.... but are we over-investing ? that means putting more money into an asset (whether it’s a house, courses, etc.) than the asset is actually worth.

1.  Properties

It's our favourite national past time. People talk about properties being the best means to hedge against inflation. Yes it probably is, but it’s not for the rookies. But now even rookies are at it, the reason? Home loans are at its record low.

But what they don’t understand is, even though it’s low now, you are taking a 25 to 35 yrs. loan & along the way it’s going up. Especially after your 2nd or 3rd year lock in period. And did you factor in the interest increasing in a few years time when you buy your dream home? Then there's the agent fee, stamp duty these are money that could be substantial. If you think of flipping your apt, these are costs that will set you back quite a bit.

As for rental, it is not predictable at all. Expats come& go, economy rises & fall- all these would affect you if you are looking to this rental income to help in paying for the mortgage. What if no one wants to rent your apartment & you have to leave it empty for months? You  hear there's an over supply now right?
 2. Renovations

I don’t understand why someone would blow a cool 100k into a brand new apt. If it's old & need work ok... but a brand new place???? In the past only the rich living in condos or landed properties hires an interior decorator or designer. Today the bulk of their business comes from HDB dwellers.

The most popular renovations involve walk-in wardrobes, “open concept” layouts, and kitchen islands. Truth is a HDB room is already so small what’s the point having a walk-in wardrobe? The cost involved in creating something so impractical is mind boggling!! And in the future any appreciation in property value is diminished by that extra cost. Worst is if you have to take up a renovation loan to do all that!

3. Get Rich Seminars

Just open the papers & you see  a ton of these.  Someone wants to impart their secret to you on how to make a million. It's really getting very popular these days. We all desperately wanted to buy some get rich secrets from the experts.

I’ve been to a few. They are essentially the same. A charismatic motivational speaker talks to you- it’s all very positive & feel good.  They don’t have any real information to give you. They just remind you that if “they” can do it ( they & other very rich people lah…) so can you! You pay $2500- for someone to tell you that!!!!  Truth is,  they make the money from just telling you : you can do it- you have it in you- dont let obsticales stand in your way & a bunch of crap like that!!! I can do that for free!!! Or just buy a book any book from some financial guru, it's just as good- can buy second some more...lol....

Oh....If you think you can do some networking there, well you’ll be disappointed, everyone there, is just like you……

Still you'll excited make plans and phone calls, and give it up a few days later. All that’s left is that big heavy file & $2500- poorer!