Tis the season to be Jolly!

It’s the end of the year where many take families overseas for holiday trips and I’m definitely one of those. As much as we love traveling for holidays, buying air tickets for a family of 5 (including my dad) cost a bomb, not to mention the other expenses incurred during the trip itself.

(Family trip to Hokkaido via Business Class on Singapore Airlines)

In this article, I want to share with you how in 2017, I managed to bring my family to Hokkaido via Singapore Airlines Business Class flight without digging a single cent into my own savings. And the best part is, anyone can do it too!

Saving Up For Family Travel is Tough

Before that, let me share with you how much I’ve spent on my family overseas trip :

Annual Family Overseas Expenses

2005 – 5 days Hong Kong: $3000
2006 – 4 days to KL/Genting: $2500
2007 – 7 days to Perth: $7000
2008 – 5 days to Taiwan: $3500
2009 – 4 days to Phuket: $2500
2010 – 4 days to A’Famosa/Melacca: $1500
2013 – 8 days to Seoul: $7000
2014 – 8 days to Osaka: $8000
2015 – 10 days to Tokyo: $10000
2016 – 9 days to Jeju/Busan: $20000
2017 – 11 days to Hokkaido: $30000

Do you see a pattern? I reduced my travel budget significantly after 2007. That’s because the subprime credit crisis happened in 2008 which subsequently affected my bonus and increment drastically.

The next few years got tougher, I had to save hard for the entire year just for the year end trip. Basically there were no savings and gradually I could only bring my family to nearby countries. Eventually, I had to stop bringing my family overseas in 2011 and 2012.

Now, was it because I ran out of savings? No!

Having a Plan is Half the Battle Won


In fact, I was preparing a strategy to fund my holidays. This strategy combines some basic money management disciplines, investment knowledge and understanding the power of dividends.

After successfully implementing it, I realised it is simple and can be applicable to anyone.

Here’s what I did…


Step 1 : Save Up My First Pot Of Money


Firstly, I started to aggressively cut down on my expenses.

For example, I go to restaurants less frequently now, only on birthdays and anniversaries.

This allowed me to reduce my food expenses from $600/month to an average of $100/month

As you have seen above, I stopped going for holidays in the next 2 years

I’ve been used to purchasing luxury bags every year but I’ve also stopped doing that.

Here’s a summary of the savings I’ve made from this.

savingsTotal Savings : $12,000/year

Step 2 : Research Companies To Invest In


After doing some detailed research into the stock market, I uncovered a list of GREAT companies that I wanted to add to my portfolio such as VICOM, Best World International, Suntec REITs, Singapore Land and Breadtalk.  All these companies I mentioned were familiar to me as I was either using their services or products. 

For example, VICOM does vehicle inspection business.  It has a simple business model where the company just conduct inspection for 70% of the vehicles in Singapore.  The other 30% were done by its competitor. VICOM has great cashflow and no debt. 

Later on, I also added some other stocks in my portfolio such as Sheng Shiong, which is a familiar brand to many, and its business is easy to understand.

In total, I researched and accumulated a number of stocks in my shopping list.

Step 3 : Wait For The Right Price…


Like most shoppers, I’ve always waited for the sales season to buy the dresses and bags in my shopping list. This is no different in the stock market.

Toromont Industries (TIH) was a real gem that I uncovered. They are a Canadian based company supplying specialized mobile equipment and industrial engines. During the Euro-Debt Crisis (2010) its business was doing well and I was valuing it at $2 when the current market price is only $1.10. 

Breadtalk was another one which I invested in 2011 when I saw the expansion of Breadtalk to overseas market, and their Toastbox and Food Republic were getting good traction.  I valued it at about $1 and it was pricing at $0.46.

Through this whole experience, I realised that being able to understand the value of the stock is very important, just like how I understand the value of an LV bag or a Ferrari sportscar.

That allowed me to take action fast when the price is right.

Step 4: Receiving Dividends


This is when things start to get interesting.

Because I diversified my investments which included REITS, blue chip stocks and high growth stocks, I was receiving dividends almost every quarter.

The REITS I’ve invested in Suntec REIT, Fraser Commercial Trust, Capital Commercial Trust and Fraser Centrepoint Trust generally, these stocks gave me dividends Once Every Quarter.

Blue chip stocks such as VICOM and Best World normally distribute dividends Once Every 6 Months

Lastly, Breadtalk being a high growth company then, issued dividend Once A Year.

Step 5: My Shares Gave Birth!


“Huh? What do you mean your shares gave birth?!”

This is a common reaction when I tell people that.

What happened is one of the stocks that I invested, Best World International, did a 2 for 1 share split in 2017.  This means for every 2 shares that I had, I’m going to get an extra share. 

This means my dividends is going to increase as I have more shares now.  That was a real surprise to me.  At the time of writing, the Best World International has gone up to more than $2 and I bought it in 2010 at about 30 cents!

It was paying out 0.007/share back in 2010 and now it’s paying around 0.041/share. That’s a 5x increase! As I bought it at $0.16 in 2010, my yield on cost is 25%.

Since 2013, I started to review my previous year’s passive income and budget my family trips based on the passive income I receive each year.  As you can see from the image below, I received more than $100k in passive income and I used part of this money to bring the whole family to Hokkaido on an SQ Business Class trip.

You can also make use of this strategy to create passive income for your family!



Knowledge does not translate to results unless you take action.  Remember “Knowledge is NOT power.  Applied Knowledge is Power.”

Start taking action today.  Grab a book, attend a program, find a mentor to guide you, get yourself educated if want to start having your passive income to sponsor your family holidays from 2019 onwards.  If you already have the knowledge, take small steps to start your investment journey. 

Last but not least, there is always risk in investment.  Do your best to lower your risks as much as possible with the right knowledge, system, start with small baby steps, get feedback, do corrective actions, fine tune the process and you will see your financial results grow with a snowball effect.

We’re organising a series of workshop that helps parents to manage their family finances more effectively. Pauline will be sharing more in-depth sharing on her process of paying for her family holidays without digging into her savings. A great way to kickstart 2019 with a proven method to plan your family finances!

Reserve Your FREE Seat Now


This article was written by Pauline Teo
Pauline is currently the Executive Director and Chief Operating Officer of 8VIC. She is a well-known speaker in the field of value investing. Having made a huge loss with a -40% return back in 2009, Pauline was personally mentored by 2 successful value investors and has since become a multi-millionaire in 2015.

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