By Lorna Tan, Finance Correspondent
MediaCorp artiste Michelle Chong is a familiar face on television. Effectively bilingual in English and Mandarin, she hosts shows and acts in sitcoms and dramas on both Channel 5 and Channel 8. She was also one of the hosts for the National Day Parade last week.
Ms Chong, 31, understands the need to not just save her money but to also make it work for her. Four years ago, she engaged a financial adviser to help her set up a unit trust portfolio comprising funds with a medium- to high-risk profile.
That portfolio is down by 5 per cent, no thanks to the financial crisis stemming from the United States' sub-prime mortgage woes. But she is staying invested. Prior to the downturn, she was enjoying gains of 20 to 30 per cent.
Since the beginning of this year, she has also been investing in the local stock market. Although she is faced with some paper losses at the moment, she is not unduly worried as she has invested in mainly blue chips.
'I'm paying tuition fees now and I've learnt that it pays not to be too eager to enter the market. Monitor and go in slowly and not with one lump sum. You need to do your homework and everyone should know that no one can really time the market,' she said.
The former Dunman High student pursued her interest in drama by taking it as an 'A'-level subject at Victoria Junior College. She subsequently studied theatre at Bates College in the US for a year before returning to Singapore in 1998.
She is currently appearing in an English sitcom, Sayang Sayang, and a Chinese variety programme, Energy Savers, on Wednesdays and Thursdays respectively.
Q: What are your money habits?
I am willing to spend on things that I perceive to be of good value, especially if they significantly enhance my quality of life or give me great satisfaction.
I don't stint on the three 'Fs': family, friends and food. I also have a penchant for a fourth 'F': fast cars. All the three cars I have ever owned have been sports cars. Having said that, I also shop at Watsons and eat at hawker centres. I save at least 20 per cent of my income and make sure I have at least six months' income in liquid assets for any emergency.
Q: What financial planning have you done for yourself?
I have both long-term and short- term investments. My unit trust investments are being managed by a financial adviser. He has diversified my portfolio into Eastern Europe, emerging markets, Asia, Latin America, Middle East, Brazil, Russia, China and India.
I invest long-term in unit trusts because of their wide overseas exposure, liquidity and low-risk nature. In this current economic climate, it's inevitable that I'm in the negative. But considering it's a mere 5 per cent, I'm not too worried about it as I believe markets are cyclical.
I am also an avid stock trader and I currently hold a significant amount of stocks, mainly blue chips such as SIA. I like to keep my investments fairly liquid as I am constantly on the lookout for investment opportunities and business ideas.
Q: What about insurance planning?
I have several insurance policies covering death, critical illness and personal accident. I'm covered for over $500,000 for death. My annual premiums amount to almost $20,000.
Q: What's your investment philosophy?
I don't believe in losing any sleep over my investments. To me, money is only a means to an end. Everyone must invest, if only to protect his assets from inflation, but there is a limit to the amount of time and energy one should spend on his investments. Which is why I believe in paying professionals to do the work for me.
I may be considered a risk taker, but I also make sure I can afford to hold my investments over the long term to ride out volatility. At the same time, I emphasise having sufficient liquidity in my investments so that I sell only when I think the time is right, and not because I have to.
Q: Money-wise, what were your growing-up years like?
I come from a family of six. When my parents married and had my elder sister, they were living in a kampung in Choa Chu Kang. My parents were distributors for various products like jewellery and houseware. They worked very hard and upgraded through the years.
When I was born, we were living in a three-room HDB flat in Telok Blangah. When my two younger siblings came along, we had moved into a private condominium in Lorong Chuan. We moved to a semi-detached house in Kembangan when I was 13 years old.
We were comfortable growing up. Our parents never denied us anything, neither did they spoil us. But we were also mature and good kids and knew our parents worked very hard to give us a good life and we knew not to ask for frivolities.
My parents over-invested and were caught in the last property bubble burst in 1996 and have never really recovered. Their experience taught me first-hand the very real risks that can come from a lack of liquidity in one's investments.
Q: What has been a bad investment?
It would be my first car, the Mazda RX-8 (although, technically, I didn't buy it as an investment because cars never are). I paid $130,000 for it in 2003 and sold it about three years later at $70,000. That's a depreciation of $60,000.
I hold 20,000 Parkway Holdings shares. Their price has plunged so much in the past two months that I am about $15,000 in the red. At the moment, it's still a paper loss. I have confidence in this company and believe its share price will go up significantly again in the near future.
But if I were to find something else better to put my money in before I make a profit, I might just sell the shares if the price continues to drop.
Q: Your best investment to date?
My best investments have been in property. In September 2005, I bought a 990 sq ft, two-bedroom condo in Duchess Avenue for $780,000. Two years later, I sold it at the property peak at $1.38 million. I bought an old walk-up, 1,300 sq ft apartment in the east for $523,000 in July last year and sold it three months later at $660,000.
Q: What's your retirement plan?
I plan never to retire. Ideally, I would like to keep working till my mind stops working, whether it's in front of, or behind, the camera, or at least in a creative field. Despite what the experts preach, I find it hard to determine a retirement age and the amount of money I'll need.
In the meantime, I hope to continue to invest my money wisely and let my investments work for me. At any rate, I enjoy working and discovering new facets to what I can do. My investment strategy as a whole is designed to support that general plan indefinitely.
Q: And your home now is...?
A 980 sq ft, two-bedroom condo in the Thomson area, which I bought last year.
Q: And your car is...?
A pearl white Nissan Fairlady 350Z Roadster with a V6 engine and 313hp that I bought just four weeks ago.
This article was first published in The Straits Times on August 17, 2008.