Calling it quits!

I'm working in the US and I need to do regular transfers from Singapore to US.

Used to be scalped by the banks (even when calling up treasury desk).

Ever since I opened an interactive brokers account, I've been able to transfer from SIN Bank -> IB -> convert at spot -> transfer to US Bank with absolutely no spread.

I will never ever go back to the banks to convert the FX.

[whizzard]

Originally Posted by Unregistered

The best thing is to find a friend or relative you can trust at a bank. They can often get the "mid-rate", which is than the bid or ask on the interbank rate depending on whether you are buying or selling.

As for myself, when I need to move a large sum from Malaysia, I happen to know the head of treasury at one of the large Malaysian banks and just call him. He will simply instruct one of his dealers to give me a good rate.

A Citigold customer is the lowest level of priority banking at Citibank Malaysia. All you need is something like RM200K in FD, which is like SGD80K. Do you really expect priority service with that kind of lowly status? 10 years not withstanding. You need to be on one of the higher tiers or be a private bank customer to enjoy priority rates. Citibank Malaysia is still far superior to OCBC Malaysia, but you need to have significant business with them.

Yes, I agree with you that Citigold is not a very high status. However, I think you either missed the point or I have been unclear in my explanation. The amount involved was fairly large, more than $5 million to be exact.

Even if you are a private banking customer or a corporate client, if you are moving smaller amounts (less than $1 mil), they won't give you anything near interbank rates. However, as the amount gets larger, it is perfectly reasonable to expect a rate closer to the interbank rate than what the money changers quote, whatever tier of banking you are in and that's what I was griping at.

The 2nd reason is that the MYR is a controlled currency giving rise to inefficiencies. Only banks with a domestic banking license is able to trade and settle in MYR unlike say CHF, EUR, GBP, USD, JPY where banks don't require a domestic banking license to transact and clear those currencies hence, giving rise to greater efficiencies. Like it or not, whenever you transfer MYR, you are held to ransom by the bank doing it for you (only banks with domestic license in Malaysia - the local Malaysian banks and some foreign banks such as HSBC, Citi, Stanchart, Deutsche, UOB, OCBC, etc). Other foreign banks like DBS, Barclays, UBS, JP Morgan do not have domestic banking license and cannot deal in MYR. The only way to remove the ransom is to find another domestic licensed bank to do it for you and Citi was probably counting on the fact that I won't trouble myself to do it. I asked both my private bankers at UBS (non-MYR licensed bank) and BOS (a subsidiary of OCBC, a licensed MYR bank) to assist but not much help from them as well, especially UBS.

Lastly, I started off my banking career as a professional FX trader at a large US bank in Singapore. I am quite well acquainted with how the currency traders deal with their clients and what kinds of trades make sense for them. In today's world (in fact since many years ago), the market structure has changed such that a trader can't expect to make lucrative profits from just quoting and clearing FX trades due to disintermediation. However, the MYR was protected from such disintermediation forces when it became a controlled currency after the Asian financial crisis in 1998 when BNM decided to control and limit trading in MYR to only the domestic licensed banks.

In any case, the point I was making is that one has to proactively manage their bankers in order to minimise inefficiencies and not allow them to simply anyhow milk you!

[whizzard]

Originally Posted by Unregistered

I'm working in the US and I need to do regular transfers from Singapore to US.

Used to be scalped by the banks (even when calling up treasury desk).

Ever since I opened an interactive brokers account, I've been able to transfer from SIN Bank -> IB -> convert at spot -> transfer to US Bank with absolutely no spread.

I will never ever go back to the banks to convert the FX.

Yes, that is indeed a great method but the limitation is that they can't do it for the controlled currencies.

[jamxz19]

eye opening!

This is a very illuminating thread.

I too have been wondering when I should call it quits. How much is enough and how to convert assets into income generating ones.

Sometimes I wonder if it's a moving target....

Originally Posted by Unregistered

This is a very illuminating thread.

I too have been wondering when I should call it quits. How much is enough and how to convert assets into income generating ones.

Sometimes I wonder if it's a moving target....

depends on lifestyle expectations.

minimum for me and my wife would be $2M excluding our home.

right now we have $270K in reits, $230K in fixed income funds and $460K cash, so still 50% off from our target unless we downgrade from our private property (current net asset value $1.8M) or migrate (e.g. Australia).

hopefully we can reach our target in another 11 years to retire by 49.

Originally Posted by Unregistered

depends on lifestyle expectations.

minimum for me and my wife would be $2M excluding our home.

right now we have $270K in reits, $230K in fixed income funds and $460K cash, so still 50% off from our target unless we downgrade from our private property (current net asset value $1.8M) or migrate (e.g. Australia).

hopefully we can reach our target in another 11 years to retire by 49.

Is it cheaper to retire in Australia? I thought the properties and cost of living there is high?

Would it be better to retire in Malaysia or Thailand? I think you can retire in Thailand with only US$1000 pm.

Originally Posted by Unregistered

Is it cheaper to retire in Australia? I thought the properties and cost of living there is high?

Would it be better to retire in Malaysia or Thailand? I think you can retire in Thailand with only US$1000 pm.

Not really. Property in Australia is less than half the price here unless you are near central Sydney. Third world like Thailand and Malaysia are not attractive at all compared to the great weather, outdoor activities and scenery in Australia.

For Aust yes and no, I have properties there and the cheaper more suburban of them are going for 400 - 500k (typical Aussie families in decent neighborhoods), I calculated before its cheaper to actually rent than borrow and pay their silly interest rates. So if you intend to move there I suggest you buy the house and pay cash, pay mostly cash or rent.

Repairing is very expensive, hope you are a good handyman. If so then parts themselves are relatively cheap.

Food can be cheap but learn how cook, eating out is expensive.

Of course it can be a culture shock so how well you adapt is really another question, I would say Msia is a lot easier for singaporeans to integrate than Aust.

Originally Posted by Unregistered

Is it cheaper to retire in Australia? I thought the properties and cost of living there is high?

Would it be better to retire in Malaysia or Thailand? I think you can retire in Thailand with only US$1000 pm.

10 years ago, when me and the missus did our sums, our number was 3m.

in 2010, number was revised to 5m.

now it's 8.

numbers based on including primary residence with no upgrades to lifestyle.

australia is expensive. might as well stay here, costs more or less level out once primary residence and cars are paid for. key diff is what your primary residence and cars will look like.

IMHO, if you can afford to retire comfortably in sg, you can afford retire in most places.