Jan 20, 2008
ME & MY MONEY
She builds portfolio to reduce reliance on salary
Local advisory firm's director manages annual returns of around 20% on her investments
By Lorna Tan, Finance Correspondent
GROWING up as the eldest child in a not so well-to-do family of five, Dr Rachael Tay, 37, realised quickly that one way up the ladder of success was through education.
That conviction has already paid out healthy dividends for her. Dr Tay has been a director at GYC Financial Advisory since 2004.
As a youngster, she made a second key decision: To study overseas and broaden her horizons. 'I wanted an overseas education to see the world and obtain a broader perspective. And I knew the only way I could venture abroad was through a scholarship,' she recalled in an interview with The Sunday Times.
A former CHIJ St Nicholas Girls' School and Hwa Chong Junior College student, Dr Tay did just that. She won a scholarship from Singapore Technologies (ST) to study engineering at Imperial College London.
There she accomplished the great feat of winning a fellowship bursary and industrial sponsorship to do a fully-paid PhD in Materials Science - Advanced Metallurgy with no bond attached. She did the course right after completing her Bachelor of Engineering degree.
While serving her six-year bond at ST as a business development manager, Dr Tay found herself involved in the world of corporate finance.
This was one of the key factors for her switch to the financial advisory sector in 2004, which was when GYC obtained its financial advisory licence.
'I liked the idea of joining a smaller firm as a pioneer. My contributions are direct and I can see the fruits of my labour. I also can foresee building a financial advisory career for life,' said Dr Tay, who heads corporate financial services and investments at GYC.
When in Britain, she met her future husband, Mr Dave Wilkins, 36, who is a management consultant with DPI. They have been married for over 11 years and have three daughters - Hannah, nine, Abigail, seven, and Kirsten, 17 months.
Q What are your money habits?
A I have always been a saver. Perhaps because of my upbringing, I am conditioned to save and not spend beyond my means.
I save 30 per cent to 40 per cent of my monthly salary, which is channelled into a unit trust portfolio monthly. I make sure I have six months' provision for expenses sitting in my bank account and the money market.
Q What financial planning have you done for yourself?
A My equity investments are split approximately 40 per cent in stocks and 60 per cent in unit trusts. I have sold all my United States stocks as I have been bearish on the greenback since four years ago.
My stock portfolio was structured mainly for dividend yields. It comprises 10 counters such as ST Engineering, Ascendas Real Estate Investment Trust (Reit), Suntec Reit and Mapletree Logistics Trust.
I now take a longer term view on my own investments and tend to tinker much less, leaving the disciplined approach GYC has developed to do its job.
My primary strategy is now buy and hold, and rebalance once a year. Over the past five years, my investments have averaged annual returns close to 20 per cent.
Q What about insurance planning?
A When our first child was born, we bought our first life insurance policies. We had already decided on investment-linked plans for the high sum assured and investment element. We also got hospital and surgical insurance.
I was a novice investor then so for part of our children's education planning, we went with an education endowment. I am now kicking myself for accepting the low yield of such policies, and making up for it with investment portfolios for the children.
Now with three children, we have upped our life, disability, personal accident and critical illness cover to over half-a-million dollars each, and have also obtained full mortgage protection.
I am insured for $500,000 for critical illness and $650,000 for life. Our annual premiums amount to around $28,000.
Q How did you get interested in investing?
A I became interested in investing 10 years ago. I saw investing as a means of reducing one's dependence on a monthly pay cheque.
This was my starting premise. I started like many Singaporeans, putting money into the local stock market. I still remember vividly asking a colleague at the time, 'How do I open a Central Depository account?'.
I learnt how to long and short stocks. I later ventured into US and British markets, and also bought unit trusts. That was during a time of great mistrust - forgive the pun - in unit trusts, because many tech-themed ones were launched at sky-high valuations and they subsequently fell dramatically.
For me, unit trusts provided two advantages at the time: First, as I had to juggle looking after my children and work, I had precious little time to monitor my stock portfolio and needed convenient, diversified market access. Second, unit trusts allowed me to initiate a regular investment programme and practise dollar cost averaging.
Q Your best investment to date?
A My best investment would be a two-bedroom London Docklands apartment bought some time in 2000. It was marketed in Singapore and the purchase price was over £200,000 (S$560,400). We put a down payment of £20,000 on it. We sold it when its value doubled about nine months later.
Q What's your worst investment?
A My worst would be a dot.com US stock bought around the year 2000 during the days when price-earnings ratios temporarily became irrelevant. I have since written off the US$20,000 (S$28,600) investment as I would have had to pay more in brokerage than what I would get back today!
Q Any other investments?
A We have a modest 100-bottle wine collection more for drinking than investment purposes.
I have a six-figure sum invested in a venture capital fund and a private equity fund which will hopefully bear great returns in time to come, but I am not counting my eggs yet!
Q Moneywise, what were your growing-up years like?
A Growing up, my family of five was certainly not well to do, but neither did we starve.
Dad was the sole breadwinner as a factory supervisor and mum took in occasional seamstress work to supplement the family income. We were taught to be frugal and to spend only on necessities. Dad's hope for us was that the great enabler - education - would help us improve our lives.
Q Your home is...?
A We now live in a four-bedroom 2,000 sq ft condominium unit in Yio Chu Kang. It was purchased at $790,000 in end-2002 and is now worth about $1.3 million.
Q And your car is...?
A We drive a gold Nissan Presage.
ME & MY MONEY
She builds portfolio to reduce reliance on salary
Local advisory firm's director manages annual returns of around 20% on her investments
By Lorna Tan, Finance Correspondent
GROWING up as the eldest child in a not so well-to-do family of five, Dr Rachael Tay, 37, realised quickly that one way up the ladder of success was through education.
That conviction has already paid out healthy dividends for her. Dr Tay has been a director at GYC Financial Advisory since 2004.
As a youngster, she made a second key decision: To study overseas and broaden her horizons. 'I wanted an overseas education to see the world and obtain a broader perspective. And I knew the only way I could venture abroad was through a scholarship,' she recalled in an interview with The Sunday Times.
A former CHIJ St Nicholas Girls' School and Hwa Chong Junior College student, Dr Tay did just that. She won a scholarship from Singapore Technologies (ST) to study engineering at Imperial College London.
There she accomplished the great feat of winning a fellowship bursary and industrial sponsorship to do a fully-paid PhD in Materials Science - Advanced Metallurgy with no bond attached. She did the course right after completing her Bachelor of Engineering degree.
While serving her six-year bond at ST as a business development manager, Dr Tay found herself involved in the world of corporate finance.
This was one of the key factors for her switch to the financial advisory sector in 2004, which was when GYC obtained its financial advisory licence.
'I liked the idea of joining a smaller firm as a pioneer. My contributions are direct and I can see the fruits of my labour. I also can foresee building a financial advisory career for life,' said Dr Tay, who heads corporate financial services and investments at GYC.
When in Britain, she met her future husband, Mr Dave Wilkins, 36, who is a management consultant with DPI. They have been married for over 11 years and have three daughters - Hannah, nine, Abigail, seven, and Kirsten, 17 months.
Q What are your money habits?
A I have always been a saver. Perhaps because of my upbringing, I am conditioned to save and not spend beyond my means.
I save 30 per cent to 40 per cent of my monthly salary, which is channelled into a unit trust portfolio monthly. I make sure I have six months' provision for expenses sitting in my bank account and the money market.
Q What financial planning have you done for yourself?
A My equity investments are split approximately 40 per cent in stocks and 60 per cent in unit trusts. I have sold all my United States stocks as I have been bearish on the greenback since four years ago.
My stock portfolio was structured mainly for dividend yields. It comprises 10 counters such as ST Engineering, Ascendas Real Estate Investment Trust (Reit), Suntec Reit and Mapletree Logistics Trust.
I now take a longer term view on my own investments and tend to tinker much less, leaving the disciplined approach GYC has developed to do its job.
My primary strategy is now buy and hold, and rebalance once a year. Over the past five years, my investments have averaged annual returns close to 20 per cent.
Q What about insurance planning?
A When our first child was born, we bought our first life insurance policies. We had already decided on investment-linked plans for the high sum assured and investment element. We also got hospital and surgical insurance.
I was a novice investor then so for part of our children's education planning, we went with an education endowment. I am now kicking myself for accepting the low yield of such policies, and making up for it with investment portfolios for the children.
Now with three children, we have upped our life, disability, personal accident and critical illness cover to over half-a-million dollars each, and have also obtained full mortgage protection.
I am insured for $500,000 for critical illness and $650,000 for life. Our annual premiums amount to around $28,000.
Q How did you get interested in investing?
A I became interested in investing 10 years ago. I saw investing as a means of reducing one's dependence on a monthly pay cheque.
This was my starting premise. I started like many Singaporeans, putting money into the local stock market. I still remember vividly asking a colleague at the time, 'How do I open a Central Depository account?'.
I learnt how to long and short stocks. I later ventured into US and British markets, and also bought unit trusts. That was during a time of great mistrust - forgive the pun - in unit trusts, because many tech-themed ones were launched at sky-high valuations and they subsequently fell dramatically.
For me, unit trusts provided two advantages at the time: First, as I had to juggle looking after my children and work, I had precious little time to monitor my stock portfolio and needed convenient, diversified market access. Second, unit trusts allowed me to initiate a regular investment programme and practise dollar cost averaging.
Q Your best investment to date?
A My best investment would be a two-bedroom London Docklands apartment bought some time in 2000. It was marketed in Singapore and the purchase price was over £200,000 (S$560,400). We put a down payment of £20,000 on it. We sold it when its value doubled about nine months later.
Q What's your worst investment?
A My worst would be a dot.com US stock bought around the year 2000 during the days when price-earnings ratios temporarily became irrelevant. I have since written off the US$20,000 (S$28,600) investment as I would have had to pay more in brokerage than what I would get back today!
Q Any other investments?
A We have a modest 100-bottle wine collection more for drinking than investment purposes.
I have a six-figure sum invested in a venture capital fund and a private equity fund which will hopefully bear great returns in time to come, but I am not counting my eggs yet!
Q Moneywise, what were your growing-up years like?
A Growing up, my family of five was certainly not well to do, but neither did we starve.
Dad was the sole breadwinner as a factory supervisor and mum took in occasional seamstress work to supplement the family income. We were taught to be frugal and to spend only on necessities. Dad's hope for us was that the great enabler - education - would help us improve our lives.
Q Your home is...?
A We now live in a four-bedroom 2,000 sq ft condominium unit in Yio Chu Kang. It was purchased at $790,000 in end-2002 and is now worth about $1.3 million.
Q And your car is...?
A We drive a gold Nissan Presage.
