Savings

In my previous post, I learnt that having substantial savings is key to financial stability. Having looked at my family’s finances, I am starting to work out a budget that is sustainable and will achieve my goals.

So firstly, looking at cash inflows:

My wife and I have a combined monthly income of $8.5k, and after deducting CPF contributions, a take-home pay of $6.8k. According to this article, this puts us just under the median household income in Singapore in 2015. I am thankful that we have stable jobs to put food on the table.

Now, for expenditure, I’d be the first to admit that we were rather profligate with our spending for the longest time. Having regular dine-outs and travelling appear to be our biggest weaknesses. No doubt, travelling keeps us together as a family, where we get to spend time together without any work distractions or pressure, and eating out together is enjoyable, especially after stressful days.

Understanding this, we discussed and are now striving to keep spending to a more sustainable level. What are some of the changes we made?

1. We choose to eat at cheaper dine-out areas more regularly, such as hawker centres, where previously, we would frequent restaurants whenever we desire.
2. We have not made plans for the next holiday overseas, unlike previously when we would plan for the next holiday immediately after the previous one comes to an end.
3. We are striving to take the taxi less often if unnecessary, opting for public transport.
4. We record our spending so that we are aware of where our money go to monthly.

We are hoping that with the above changes, we will be able to reduce unnecessary consumption and save the unneeded spending. These are early days still, and we are only just beginning our journey!