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Old 30-03-2018, 06:09 PM
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We are the average 35 yo male and 33 yo female couple earning $180,000 p.a. We have a 3-room hdb fully paid. Resale value is around $350K. Our car is a Japanese sedan left with $20,000 outstanding loan and 2 years loan tenure. $250,000 in cash and $150,000 in Cpf OA. No investment portfolio beside endowment plans. No children. Any suggestion for passive income and wealth accumulation portfolio? Much appreciated.
You asked the "million dollar" question.

Everyone wants to know how to get rich.

For the average Jane & Joe, there is no short cut. And there is also no secret formula.
These "tricks" or steps have worked for many who have walked the path and will continue to hold true for generations to come.

1. To build wealth, you need an income. Incomes come from having work. You need to be in employment to have a salary/income.

2. The next step after having an income is to save. If you spend all you earn, you know you cannot grow your wealth. How much you can save from your income will determine how fast your wealth will grow.

3. The next important factor to wealth building is time. If you faithfully perform steps 1 & 2 over many years (30 to 40 years), you will be able to build up substantial wealth. Saving $50k yearly will give you $2M over 40 years. Saving $100k pa will give you $4M, etc...

4. The next thing you need to do is to protect that wealth from being eroded by inflation. Here, the CPF SA gives 4% which is slightly above inflation rate, so dont touch that money. Over time it will compound to a nice amount. For the rest of the savings, you can buy blue chips or ETF funds if you are not into buying individual stocks. Dont trade in stock. If you have substantial savings, buying a property for rental income and capital protection is another option.

5. Finally, be aware that investments bring both returns and risks. Bad investment choices will erode your wealth rather than build it!

Of all the steps, steps 1 to 3 are the foundations for any average Jane and Joe looking to building up a comfortable retirement nest egg. Neglecting one of them and you will not be able to build up your wealth properly.
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