Wolf Money(portfolio update end Oct 2025)
The Middle Class Trap
This write-up is a combination of my observation and experience.
Imagine a couple with two kids earning a combined income of $14,000. Comfortable income by any measure if the family spend well below their means.
The biggest expense of any household with kids goes into sending the children to school. The initial years of sending them to childcare are the most draining on household finances. Most parents, if not all parents, wanted the best for their kids. Enrolling them in a good childcare. The school fees for 2 to 6 years old are around $1900 per child per month before government rebates are given to working mothers.
For a family of 4, a family car can help move people around easily. An entry-level car will set out another $2500 per month in installment and related expenses.
If the wife wanted to live in a nice 3-bedroom condo with a swimming pool for the kids to enjoy the facilities. Mortgage payments are likely to take up the bulk of household expenses. CPF covers $5180 of the monthly payment, which works out to be lower of the $6000 installment. Cash layout of $1000 a month.
Food and daily expenses for the whole family will be in the range of $2000-$3000 per month.
Twice a year holiday to an Asian destination. $18000 a year. About $1500 a month.
The expenses can go on. I will just stop here before it sounds depressing. Will there be anything left at the end of the month for the couple? Will the couple be able to save for their retirement? I would be very surprised if they could.
Why and how I did it my way?
No family car. Taking public transportation is just fine. I enjoyed my many bus trips with my family. A genuine conversation can be made while traveling.
No frequent holidays to expensive destinations. There are plenty of places in Asia to explore. It is not the location, it is the company that matters.
No luxury condo. My initial years were spent living in a rental flat and a 3-room HDB. In my opinion, some HDBs have better estate management than some condominiums.
No branded childcare(student care). I can vouch for the childcare and student care that we use were markedly better than the branded childcare. The passion of teachers to impart knowledge to the children is the key to a more holistic learning experience.
Every dollar I saved, I kept it for my investment. I did it for a specific reason of not having to beg for financial help in my twilight years. There is no luxury lifestyle at the end, but a life of dignity awaits. My experience is uniquely mine. Everyone’s circumstances are different. I was dealt with less prerogative life cards and are “forced” to play my best hand with the cards I have. If one is born in a privileged family. There is no excuse not to do better.
As the world economy grew uncertain. It is tougher to make a living in Singapore. Keep working on improving your finances. One day your kids will thank you for the prudent steps taken to raise them. Never get sucked into the middle class trap, no matter how seductive they may be. A life free from money woes is the best gift you can give to your family. I wish you all the best in your path towards financial freedom. God Bless.
Lone Wolf Fund(LWF)
Portfolio as at end of Sept 2025
1.) Cash
*Stocks are not rank in accordance to capital invested.
Commentary
A couple of “ins” to the portfolio in Sept was followed by a couple of “outs” in Oct. Follow by a seller’s remorse which was follow by “Queen’s Gambit”. I am not convinced by the bullish market, even though I might have a bit more confidence with my own analysis. Both sold positions of CH Offshore and Thai Beverage turned in a positive gain for Lone Wolf Fund. Bringing the YTD gain to 17.5%(unleveraged excluding dividends and cash yield). Overall after a month of “trading” in and out of Thai Beverage. LWF managed a 1% gain. CH Offshore gains managed to cover the brokerage fees in Thai Beverage 2.0 trade. A sense of calm came for the market after US regional banks’ bad loans hit sentiment of the market. The conclusion of US-China trade deal is another factor supporting the market.
I can sense the uneasiness in the US market with many experts denouncing the market in a state of bubble. Trying to predict is not what I do. I adjusted my strategy accordingly to the current market conditions based on my own experience. I like to have some capital sitting freely. Just in case, a big opportunity for me to get excited. My strategy is simple. I am trying to farm out smaller gains till the market conditions turn favourable for me. I am expecting government data going forward to be pretty bad given what is happening in the US. No idea how the market might react to those data. Half glass full or half empty? I favour short-termism active portfolio management over long-termism passive portfolio management. To be frank, the current market is a tradable one, with the US “chief market manipulator” providing daily commentary to ensure punters get their dose of speculation “drug”.
Thai Beverage PCL(sold)
After the long Deepavali weekend, Thai Beverage basically back to my portfolio. It was strange I decided to sell it away before the long weekend. I guess I am fixated on the health of US regional banks. The future was down sharply before White House jumped out to save the day with positive development on the government lockdown and talks with their Chinese counterparts on the trade front. I bought back Thai Bev at 1c higher than I sold. I took it as an insurance premium paid.
MAS is giving incentives to encourage listco to increase their value unlocking exercise, thus increasing shareholders’ value. I hope the incentives is attractive enough for Thai Beverage to list their BeerCo. The company will be reporting FY25 earnings in mid November. In another twist of event, I sold Thai Beverage for the second time this month. With the passing of the former Queen of Thailand, it added another layer of complexity to list a beer company amid the Queen’s death. It might even be seen as bad optics to do so. The Thai Government has declared a year of mourning . I will revisit the idea maybe sometime down the road.
Cash
Most savings accounts offer interest less than 1.3% due to lower rates across different tenures in our bond market. Our 10-years rates had fallen towards the 1.7% mark. I am expecting interest on the pure vanilla saving account to hover around 1%. Sold MariBank SavePlus due to falling bond yields. After using for a couple of months, I find MariBank customer service unsatisfactory. If you want less problem in your life. Avoiding having an account may do just that.
Summary
Lone Wolf Fund should be fine this year. Next year might represent more of a challenge. I have come across many asset classes which are either in a bubbly state or at an inflated price. Some sectors like oil and gas and renewables are the two undervalued sectors. Given the oil price is artificially suppressed due to political reasons pending next year’s mid term election. There might be opportunity in that sector sometime down the road due to under-investment in the sector. The market is also undervaluing cash. The worst situation is for high inflation to reappear, and the US Fed will have to revise course to raise rate again. The only main decision which I need to make is, do I continue to participate in the stock market for additional gains or should I sit out of this overvalued market? I am probably too harsh to paint the Singapore market in the same overpriced camp. Does our market have strong enough legs to stand on its own if the US market eventually goes back to its mean valuation? I just hope I am not around to find out the painful way. I have gone through a few big crashes in my investment career, but I don’t believe I have superior knowledge over anyone about the timing of the next crash. I am guided by God and common sense. God bless.
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