fbpx

How To Make More Money In Singapore

Personal Finance

Written by:

Alvin Chow

Singapore is known to be one of the most expensive places to live. To be fair, you can still live like a monk and not need a lot of money in Singapore. But most people have aspirations and want a certain standard of living. This means that making more money is necessary to attain these goals. We explore four ways to make more money in Singapore.

Career

Our parents have been drumming this into our heads – study hard and get a good job. Some of our parents didn’t manage to attain good educational qualification and they hoped that their children can outdo them. They believe that life will be better if their children are educated.

Our parents have the best of intentions. Career is the safest choice because of the regularity of a salary. In fact, the “reward” of receiving a consistent monthly salary can be so addictive, it may feel impossible to wean off, even if employees hated the job.

Our parents are right in that higher education tends to lead to higher income. This is especially so when we move into the knowledge economy where manual labour is paid less than a managerial role.

But that doesn’t mean a knowledge-based job is any easier. Stress levels can be high. It also gets harder to climb the corporate ladder as the pyramid narrows at the top. There will be a point in time where you hit a career plateau and promotions become very unlikely.

What do you do then? There’s definitely no point putting in more effort because you are unlikely to reap more rewards from the job. It might be okay for people who just want to cruise through life. But it isn’t enough if you want to do better and want more in life.

This means that you have to manage your career more actively;

  • Is there a new company you can join which can increase your pay?
  • Can you network and know more people in the industry that can land you better opportunities?
  • Would getting a Masters or higher education qualifications help in furthering your career?
  • Can you learn a new skill that can make you more valuable in the market?

I strongly believe in Scott Adam’s concept of combining two mediocre skills into something valuable – the whole is greater than the sum of parts. For example, Dilbert was created because Scott combined his drawing skills with business knowledge.

You have to get a sense of the ROI when you double down on your career. Sometimes, the career may only lead to a dead end, especially if you are in a sunset industry – re-skilling to prepare yourself for a career switch is often a better solution.

Other times, you may need money immediately and that’s where side gigs become more attractive instead.

Side Gigs

Technology has enabled the gig economy – it is a lot easier to start a side gig now, compared to the past. You can be a private hire driver with Grab on a part time basis. You can do delivery. And let’s not forget the all time favourite option, tuition.

A part-time Grab driver could earn about $86.20 driving for 3 hours on a weekday (6pm to 9pm). 20 days a month would mean $1,724. This is excluding the fuel expenses and the cost of the car.

A part-time GrabFood driver could earn between $6 to $11 per delivery. Assuming 2 deliveries per hour and working 2 hours per weekday, it could amount to as high as $44 a day. A month of work would generate about $880. GradFood incurs much lower expenses (bicycle) than driving Grab (car).

A part-time tutor could earn about $30 per hour. This is highly dependent on the education level that you are tutoring and the credentials you have. Assuming 2 hours per session and 12 times a month, the earnings could amount to $720.

Side gigs are very doable and the income is decent if it is just a supplement to a main income that you have. But working part time is not a long term solution because you are not going to get any increment over the years.

You have to put in more hours in order to earn more but you only have 24 hours a day and your energy is limited. It becomes worse if you have a family and working on gigs would take your time away from them. There’s an intangible price you have to pay.

Investing

Gigs may not be possible for some employees as most companies forbid moonlighting activities. Investing can be a good alternative if you fall into this category. Obviously this is what I prefer too. But it isn’t suitable for everyone, in order to do well in investing, you’ll need to have:

  1. capital and
  2. the right temperament.
  1. Capital

Everyone has to start somewhere. As long as you have an income, saving for investment capital is definitely possible. Of course, you’ll need to make some sacrifices; curtailing your expenses and saving as much as you can. Overtime, your capital would snowball until you have enough to live on your investment returns.

  1. Temperament

This would be a harder problem to solve. It is usually tied to our personality and can be one of the most difficult things to change. You can’t be too conservative because you wouldn’t be able to pull the trigger or invest meaningful amounts. You can’t be too aggressive because you would risk too much and may lose all your capital. You have to be patient because you are not going to be a millionaire overnight, nor even next year. You must be able to take losses and stay on course even when the market torments and plays with your feelings repeatedly.

Investing can be done in many ways, using many different assets. It can be as passive as investing through financial advisors or robo-advisors. You can go one step deeper by building your own portfolio using ETFs and funds. Or, you can be in full control and pick stocks, if you are willing to spend more time on research.

You can also consider investing in other assets such as properties, cryptocurrencies, art and whiskies. You are spoilt for choice but it is more important to you stick to one area and be good enough to beat the majority in the game. It is important to be a master of one when it comes to investing. Jack of all trades usually get killed by the masters.

Investing for dividends is a crowd favourite because it feels good to see cash being deposited into the bank account, without having to feel like you worked for it. Our Early Retirement Masterclass trainer, Chris Ng, has always advocated aiming for $100 per month dividends for a start. It would build confidence once that’s achieved. This is possible by investing $24,000 at 5% dividend yield.

Investing can be as time consuming as a side gig – if you pick stocks or do short term trading. That said, investing is more scaleable. You are not limited by the amount of time you spend on researching but the amount of capital you have. For example, you spend the same amount of time researching a stock idea regardless if you invest $5,000 or $500,000. Comparatively, you can only scale a side gig by trading more time for more money.

Entrepreneurship

Entrepreneurship is the riskiest and the most rewarding endeavour one could ever embarked on.

It is riskiest because you can lose more than what you have. The odds also say that you are likely to lose. Besides money, you would also lose time and energy which you can never recover ever again.

It is the most rewarding because you can be rich beyond your imagination. The intangible satisfaction of creating a successful business is also indescribable. The self worth can be immense.

The chances of success are very low and that’s what probably stopped most people from trying. But you can minimise the risks by testing the market for your product and services. This is made possible because of the availability of internet platforms. For example, you can go on Facebook or YouTube to share about your domain knowledge and see if there are people interested in what you have go to offer before going full time with your service. Or you can create product listings on Carousell or Qoo10 to see if people buy your products before you launch a complete business out of it.

The lean startup mentality is highly applicable in this new era – it is important to test demand before risking big money in any business venture. Once there’s product-market fit, it is just a matter of scaling up your marketing and operations.

Conclusion

There are many ways to make more money in Singapore.

First, your career is often the best and safest bet. Try all means to increase your earning power by upgrading yourself or networking. Re-skilling to move into another industry may be necessary if you happen to be in a sunset industry. Otherwise you might eventually be retrenched once the job role becomes obsolete.

Second, side gigs are the fastest way to make money immediately. Companies like Grab has made gigs easy and the platform provides ready customers for you to serve. But you will have to exchange limited time and energy for money. It would also take away family time. Side gigs aren’t scaleable because you have the same amount of time like everybody else.

Third, you can consider investing your money if you cannot or don’t prefer to do side gigs. Investing is not a bed of roses and you must have the right temperament to do it well. It may also require time and effort to do your research. Otherwise, there are more passive ways to invest – using financial advisors and roboadvisors. The benefit is that investing is a highly scaleable activity – you use money to make more money and are not limited by the amount of time you have.

Last but not least, the riskiest but in my opinion, most rewarding way to make more money is through entrepreneurship. We know that the odds of business success is very low. You would want to play this smart by adopting the lean startup mentality by testing demand before committing full resources to build a business.

I hope I have help to address the possibilities to make more money in Singapore. I wish you all the best regardless which path you decide on!

Leave a Comment