How does one earn more money?
The answer used to be straightforward: work hard in your career, climb the corporate ladder, get a better salary.
Growing up, this was my impression of what it must be like as a working adult -- Earning money, saving up, and seeing the number in the bank account grow.
But managing your money turns out to be a lot more complicated than that. You also need to set up an emergency fund, look for adequate health insurance, and not forget about covering your debts or loans.
And when it comes to making more money, there are also other options beyond just pursuing a higher remuneration.
Some spend their free time on a side hustle like part-time tutoring, selling crafts, or freelancing.
If you have the capital, one way to make passive income is to own property and lease it for rent, but reaching that stage is a challenge in itself.
Given that these ways to grow wealth take a substantial amount of time and effort, investing in the stock market is a popular alternative.
Is investing a good way to grow wealth?
Investing has turned into a sort of buzzword, with new trendy portfolios like Bitcoin, Dogecoin, NFTs, GME, hotly discussed in online spaces, and making headlines every other month.
It’s quite tempting to join in on what everyone’s talking about - but following the crowd on this is not a good idea, especially if one doesn't understand the foundations of the asset you’re putting money into.
While the FOMO is real, trends are transient - meme stocks come with not only the highest highs, but also the lowest lows. In fact, finding and investing in the right stocks for you actually requires a great deal of time and effort.
With such a wide variety of investment options out there, it can be hard to know where to start, especially for someone who doesn’t have the time or energy to be staring at charts and graphs all day.
If you feel this way, you can consider using an investing application like a digital wealth management platform (aka robo-advisor).
Instead of chasing and trying to outperform the stock market, digital wealth managers like Syfe have a more “passive” yet fuss-free approach to investing.
How does robo-advisor Syfe work?
Robo-advisors are digital platforms that use automated solutions and algorithms to invest on your behalf.
While most are digital-only, Syfe has a team of wealth experts ready to help.
You can speak to them to get a better understanding of the available portfolios, and how they can work for your financial goals. Users can also join their weekly #AskSyfeLive sessions to ask their wealth experts anything.
Your money is invested in globally diversified, low-cost portfolios - a key to building wealth steadily over time. Diversifying your investments also minimises the risk that you’ll lose money while reducing the fluctuations in your portfolio’s overall returns.
What can you invest in?
Syfe users can mix-and-match from four portfolio options to create their own personal investment plan. In a short risk assessment survey, Syfe takes into account your investment goals, time horizon, and risk appetite.
One popular portfolio is Core Equity100, a 100 per cent equity portfolio for investors who are more comfortable taking on a higher risk for potential higher long-term returns.
Another is Core Growth, a higher-risk portfolio that holds predominantly stocks with some bonds and gold.
They respectively boast a 13.9 per cent and 10.8 per cent average annual return rate in the last eight years.
If you are looking for passive income, a popular option is Syfe REIT+, in which you invest in properties such as shopping malls, office towers, business parks, hotels and hospitals. The dividend yield in 2020 was 4.5 per cent and Syfe has forecasted a dividend yield of 5.1 per cent in 2021.
Syfe also has a Cash+ portfolio which provides a projected return of 1.5 per cent per year for cash placed with them. It’s an alternative to bank saving accounts, which currently offer very low interest rates.
Why choose Syfe?
Syfe users pay S$0 in brokerage fees, and the best part is that Syfe prizes flexibility for users - there is no lock-in period, and you are free to withdraw your funds at any time, at no cost.
Syfe also has no minimum investment amount, so you can decide to invest any amount of money you prefer each month.
The management fee per year starts from 0.65 per cent, one of the most competitive in the market. That means you pay Syfe S$0.065 for every S$100 you invest.
Additionally, the more you invest, the less you pay in management fees. You also get greater access to Syfe’s wealth experts.
For the uninitiated, it’s easiest to start with a monthly investment plan with Syfe.
To do so, you just need to set up a recurring transfer/standing instruction through your bank to transfer funds to your Syfe portfolio each month.
The process is automated, and consistent, such that investing can in fact be a simpler experience.
Investing on a monthly basis is a strategy known as dollar cost averaging -- By spreading out one big investment into many small investments, and entering the market in small amounts over a period of time, investors can minimise risk and ride out market volatilities.
With Singpass, users can create a Syfe account in just three minutes.
Explore the app - including investing videos and guides - and be sure to weigh your investment horizon, risk appetite and financial goals when making your decision.
If you're looking to start a monthly investment plan with Syfe, save on fees for three months when you use the code MOTHERSHIP. Your fees on investment amounts of up to $30,000 will be automatically waived.
This sponsored article by Syfe made this writer re-consider how they are accumulating their own wealth. This is not financial advice. All investments carry risks. Any reference to an investment's past or potential performance is not an indication of any specific outcome or profit. Always do your own research before investing. This advertisement has not been reviewed by the Monetary Authority of Singapore.
All images by Syfe.