Latest news with #Providend
Independent Singapore
23-07-2025
- Business
- Independent Singapore
‘How do I save S$1 million for my baby in Singapore with just S$200/month?' — Singaporean woman cracks the money code for her child's future wealth
SINGAPORE: Becoming a new parent comes with an avalanche of decisions — co-sleep (bed-sharing) or crib, breastmilk or formula, and… how to raise a tiny millionaire? CNA's Money Mind host Cheryl Goh asked a question most Singaporean parents probably dream about: 'I'm about to start my new life as a mother… I'm wondering if I can help my child grow a million-dollar portfolio and how I can go about it.' Photo: YT/@CNAInsider Spoiler alert: it's possible. And all it takes is S$200 a month, decades of patience (or maybe not), and the magic of compounding. Million-dollar baby? Start with a humble index fund Sudhan Purushothuman, Associate Adviser at Providend , isn't selling a get-rich-quick scheme. In fact, his advice is refreshingly boring but safe — and that's exactly the point. 'The simplest and most effective way is to actually invest in a low-cost globally diversified index fund,' he said. 'With just S$200 a month, you can actually compound to a huge sum of money over the long term,' he added. Photo: YT/@CNAInsider Run that math over 50 years with a conservative 7% annual return, and you're looking at S$1.1 million! That's seven figures for your child's golden years, just in time for them to maybe afford a resale flat. Can't wait 50 years? Increase the heat On the other hand, if you're impatient, Sudhan gets it. So if you could contribute around S$2,000 a month for 20 years, then, he says, you'll end up with around S$1 million with the same conservative 7% expected return. The key here is staying consistent in your investing. Photo: YT/@CNAInsider So where does this 7% figure come from? According to Sudhan, it's based on long-term data from the MSCI All Country World Index (globally diversified index), which typically yields between 8% and 10%, but 7% keeps expectations grounded. Why globally diversified ETFs are the MVPs Low-cost ETFs (exchange-traded funds) that track global indices are the unsung heroes of long-term investing. Why? They're diversified, don't require you to guess which country or sector will boom, and they save you money on fees. See also Are Fitness Subscriptions Really Worth It? Photo: YT/@CNAInsider 'This strategy gives you the highest probability of success because it's evidence-based,' Sudhan explains. 'You basically own the whole economy… and stick to a disciplined way of investing monthly.' But if you're someone who's worried your investments may lead to climate change or even animal cruelty, then the Vegan Climate ETF (Ticker: VEGN) offers an opportunity for investors to invest in the stock market through a low-cost index fund or exchange-traded fund as well like the S&P 500, but minus the companies that exploit the environment and animals. Because you're far more likely to stay committed when your money is backing causes that matter to you. Moving on, what about the investing fees, you may ask? Fees: The silent millionaire killer Tim Phillips, Founder of TimTalksMoney , did the math — and it's scary. 'A lot of active unit trusts charge 1.5% [per year],' he said. 'If you get to S$1 million, you're paying S$15,000 in fees every year.' Photo: YT/@CNAInsider In contrast, low-cost ETFs charge as little as 0.1% or less. So on a S$1 million portfolio, that's just S$1,000 annually — leaving more of your hard-earned cash to keep compounding. Watch for tracking errors and AUM Before you go on an ETF shopping spree, Sudhan advises keeping an eye on the tracking error — the smaller the error, the better (aim for less than 0.5%). This 'means the ETF is tracking as closely to the index as possible,' he says. Tim adds that assets under management (AUM) matter too. 'You want an ETF that has an AUM with over US$1 billion,' he advises. Photo: YT/@CNAInsider Why? Because obscure or poorly performing ETFs risk being shut down — and that can interrupt your compounding party. What about investment risks? Yes, stocks are volatile. There will be crashes, corrections, and the occasional global crisis. Tim puts it bluntly: 'There are going to be periods… may be a year, three years, five years… and in some cases… a decade where not much happens.' But over 20, 30, or 50 years, the data consistently shows stocks outperform other assets. Photo: YT/@CNAInsider Still worried? You're not alone. Sudhan recommends adding bonds into the mix to cushion volatility. For example, consider a 60% index fund ETF portfolio and then add a 40% bond to achieve a 100% allocation, he suggests for those with lower risk tolerance. CPF: Guaranteed returns, but with strings For Singaporeans, there's another tool in the baby-millionaire toolkit — the CPF Special Account (SA). Photo: YT/@CNAInsider It 'gives 4% to 5% per annum, guaranteed by the government,' says Sudhan. Sounds great? It is — but you can't withdraw the money at will. Plus, the lower returns mean you'll need more time to reach your million-dollar goal. In short: safe, but slow. Bonus tip: Throw in your bonuses! Tim drops one last gold nugget: boost your child's fund with your year-end bonuses or windfalls. So instead of blowing it all on a feel-good spending spree or splurging it on impulse buys or even burning it on a shiny new gadget that you'll forget about by next month anyway, don't forget what Tim advised here: 'There's no rule that says you can't contribute when you get a bonus. Allocating 5% or 10% or less of it will accelerate the compounding process over time.' Photo: YT/@CNAInsider In short, whenever the ang bao is fatter than usual, stash some of it away for your junior's future. Million dollars ≠ Million-dollar life Let's be real — S$1 million in 50 years won't buy the same things it does today. Inflation will nibble at its value. But leaving that money in a savings account will hurt even more. 'I think the low-cost index fund and CPF are what I would be most comfortable with as someone who is risk-averse,' Cheryl concludes. 'But that means I'll have to start early so I can give my child the best possible head start.' Photo: YT/@CNAInsider And that's really the point: it's not about chasing market highs or stock-picking wizardry. It's about playing the long game, staying consistent, and giving your child something far more valuable than cash — a strong, secure foundation. See also What Mums-To-Be Should Know About Pregnancy Insurance As investment analyst Kenneth Fisher once said: 'Time in the market beats timing the market.' Want to see how it all adds up? From compounding magic to investment pitfalls, Cheryl Goh's journey into financial planning for her child is both relatable and eye-opening — especially if you're a parent wondering where to begin. Watch the full Money Mind episode on CNA Insider below to hear directly from the experts, see the charts in action, and get practical tips on building a million-dollar portfolio for your child — even if you're only setting aside S$200 a month. Because in the end, it's not just about the money — it's about giving your child a future that grows with them. This article is for educational purposes only. It should not be considered Financial or Legal Advice. Investors should conduct their own due diligence before making major financial decisions In other news, a Singaporean couple has transformed their home into a multi-stream income engine, generating over S$3,000 to S$5,000 a month through practical, proven side hustles that are perfect for 2025. Now, imagine how much they can save by earning and investing more for their future child if they planned to have one. In a video that has been making waves among aspiring entrepreneurs, Darien (the hubby) breaks down 10 legitimate side hustles that Singaporeans can start right now. Some require skills, others need hustle, but all are achievable. Photo: YT screengrab/@darienandjoanna You can read more about them and find out how you too could turn your home into a money-making machine while you bake sourdough, play with dogs, or teach a workshop — all without stepping out of your front door over here: 'We make S$5000/month!' — Singaporean couple turns their S$1M condo into a passive income machine with 10 side hustle recommendations, working from home
Business Times
22-06-2025
- Business
- Business Times
BT Money Hacks: Long-term investing - Still a safe bet or a risky hold?
You've heard it a hundred times: 'Stay invested. Think long-term. Don't time the market.' But in a world of constant crises, high interest rates, and rollercoaster markets, does that advice still hold up? That is precisely the question the latest episode of Money Hacks by The Business Times explores. Host Howie Lim is joined by Tan Chin Yu, lead of Advisory Team, Providend and Yee Shen Hao, financial services manager, Phillip Securities. Between the three of them, they slice through the clichés with the precision of a well-sharpened spreadsheet. Why listen? Because everyone says 'stay the course' — but no one tells you how to do it without losing your nerve. Because you may be mistaking volatility for failure — and that could be costing you real returns. Because 'buy and hold' isn't a strategy if you're asleep at the wheel. And because, let's be honest, some portfolios deserve to be left behind — no matter how long you've held them. This isn't your average lecture on compound interest. Expect straight talk, a few myth-busting moments, and just enough edge to make you rethink what long-term investing actually means in 2025. Listen to the full episode of Money Hacks now because investing isn't just about growing wealth—it's about making peace with uncertainty. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up As always, host Howie Lim encourages listeners to share their feedback or suggest ideas for future episodes by reaching out via email at btpodcasts@ --- Written and hosted by: Howie Lim (howielim@ With Yee Shen Hao, financial services manager, Phillip Securities; and Tan Chin Yu, lead of Advisory Team, Providend Edited by: Howie Lim & Claressa Monteiro Produced by: Howie Lim & Chai Pei Chieh A podcast by BT Podcasts, The Business Times, SPH Media --- Follow BT Money Hacks podcasts every Monday: Channel: Amazon: Apple Podcasts: Spotify: YouTube Music: Website: Do note: This podcast is meant to provide general information only. SPH Media accepts no liability for loss arising from any reliance on the podcast or use of third party's products and services. Please consult professional advisors for independent advice. --- Discover more BT podcast series: BT Correspondents: BT Market Focus at: BT Podcasts at: BT Branded Podcasts at: BT Lens On:
CNA
16-06-2025
- Business
- CNA
CNA938 Rewind - #TalkBack: Tapping your credit card or phone everywhere, are we mindlessly making payments?
CNA938 Rewind Singapore's adoption rate of cashless payments is the highest in South-East Asia at 97 percent, with speed and convenience being cited as driving factors. But, has this led to some bad user habits, such as tapping one's card without checking what you're actually paying for? Lance Alexander and Daniel Martin discuss with Matthias Tan, Senior Client Advisor, Providend.
Business Times
05-06-2025
- Business
- Business Times
How to invest through Trump's turbulent tariffs for a young investor
[SINGAPORE] China and the United States have agreed to reduce reciprocal tariffs on each other for 90 days and commit to trade talks, a move that has calmed investors fearing a global slowdown. Knowing that, how should you invest differently? Buy stocks, they say – but which ones? Stocks from practically every developed country will benefit. Or buy the US dollar, which investors have fled from since the tariffs? Perhaps sell gold, which investors have lately been turning to for safety? The problem, as you may have already realised, is that unless you had insider knowledge that the tariff pause was going to happen, it's probably too late to do all of these things. The S&P 500 stock market index jumped 3.3 per cent (that's huge for an index) on Monday (May 12), following the tariff pause announcement. The US dollar surged while gold lost 2.7 per cent. Some may say that the news of the tariff pause is 'priced-in'. As regular Joe investors, that's the challenge we often face. We'll often be late if we try to make short-term trading decisions based on the news we read. (Trading bots and professional traders would have reacted before we finished reading the article.) A NEWSLETTER FOR YOU Friday, 3 pm Thrive Money, career and life hacks to help young adults stay ahead of the curve. Sign Up Sign Up We're at the stage now where the US tariffs on most countries, including China, have been temporarily lowered. (Additional tariffs on Chinese imports were reduced from 145 per cent to 30 per cent, and the universal 10 per cent tariffs on most countries remain in place.) While financial markets cheered the move, businesses are still unsure of what will happen after the 90 days. So, how should we invest when the future is so uncertain? 🕜 How long is 'long term'? Firstly, don't panic and avoid knee-jerk reactions. One of the golden rules of long-term investing is to stay invested and not panic sell at the first hint of trouble. Your stock investments may rise and fall dramatically from week to week. But zoom out, and you'll see that stocks will rise over the long term. But there's nuance to this truism – I'll touch on two. Firstly, the US stock market often bounces back quickly after a decline. This may take months or a couple of years. Some crashes have taken longer. If you had invested in the S&P 500 index before the dot-com bubble in 2000, your investment wouldn't have grown even after 10 years had passed. Going further back to the Great Depression in the 1930s, the S&P 500 took 15 years to recover. Christopher Tan, chief executive officer of wealth advisory firm Providend, notes that it was during this time that the US enacted the Smoot-Hawley Tariff Act, now widely blamed for worsening the Great Depression. The Act raised US tariffs on foreign imports by about 20 per cent – sounds familiar? While there's no telling if history will repeat itself, it's important to prepare for the possibility of prolonged drawdowns to our portfolios. And if we can't stomach that, take steps to strike a balance that'll help us sleep well at night. 🧺 What you're invested in matters Secondly, we've so far been talking about the S&P 500, the de facto measure of the US stock market that tracks the performance of the 500 leading companies listed in the US. It's often said that all you need for investments is to buy an S&P 500 index fund, and you're set. While investors who followed this bit of advice have profited greatly, experts have warned that investors who hold only an S&P 500 index fund may not be diversifying their investments enough. While the US market has done well over the past 100 years, there's a growing worry that things will not remain the same in the future, especially given US President Donald Trump's on-again, off-again stance on tariffs. With volatility ahead, many analysts recommend reducing risk to protect your capital. After all, Trump's trade war has only paused, not ended, and the US' 10 per cent tariffs on most foreign goods are still in place. But rather than sell off your investments and wait for things to settle down, consider spreading your funds across different assets and geographies. Diversify by geography: If you're heavily invested in the US stock market, consider adding stocks or index funds from countries as well. Alternatively, you may wish to invest in a fund that tracks a globally diversified index such as the MSCI All-Country World Index or the FTSE All-World Index. An added benefit of diversifying your portfolio beyond the US is that it reduces currency risk. With the recent weakening US dollar, those heavily invested in US stocks may have experienced their portfolios losing value in Singapore-dollar terms. Diversify by assets: If you're heavily invested in stocks, consider adding other asset types into your portfolio that can cushion the volatility in the stock market. Commonly, investors have turned to bonds for this because they tend to do well when stocks do badly. But this hasn't been the case in recent years, such as in 2022 when both stocks and bonds suffered negative returns. Alternatives include gold, which has been the best-performing asset class this year. Gold prices surged more than 20 per cent this year to date, but many analysts believe it can go higher. Gold is often described as a safe haven asset because it is a reliable store of value through times of geopolitical uncertainty and inflation. Central banks around the world have also been buying up gold as they seek to diversify their reserves from the US dollar. Financial advisors typically recommend not holding more than 10 per cent of your portfolio in gold, in the same way you won't want to hold too large a percentage of an individual stock. TL;DR
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CNA
26-05-2025
- Business
- CNA
Money Talks - Thinking of investing your CPF? Here's what you need to know
Money Talks Play Beyond using your CPF to buy a home or as a retirement plan, it can also be used for investments. But what are the risks involved? In this episode of Money Talks, Christopher Tan from Providend explains how to avoid some common investment pitfalls.
