How much are you earning per annum?

Originally Posted by Unregistered

what are you doing to make so much at your age? sales? ppty agent?

i am an underpaid lawyer

Downgrading as a retirement plan makes perfect sense. Most people work their whole life to finance their home mortgage and when they retire, their home becomes their main asset. Since many don't have much other assets as most of their salary goes to daily expenses, insurance and paying the mortgage, they will have to downgrade in order to get cash for their retirement expenses. A couple living in a landed may downgrade to a condo, a couple living in a big condo may downgrade to a small condo, a couple living in a condo may downgrade to a HDB flat, etc. Those who are lucky enough to earn a lot and not get retrenched in their 40s may afford to keep their home and have spare cash for retirement.

I'm now 53 and plan to retire at 60. My penthouse is now worth $2.5m and I plan to sell it at $3m when I retire. I will then downgrade to a $1m one bedroom condo (must be next to an MRT station for convenience) and invest the balance $2m. Assuming I can generate a modest 4% dividend yield, I will get about $80k pa in passive income. This should be sufficient for me and wife.

Originally Posted by Unregistered

Many tend to focus on how to 'buy' their dream home (be it a C or a landed) but pay little attention to figure out how to 'own' it. Remember you don't own it if you leverage.

So, downgrading becomes part of the retirement plan. In my view, downgrading is Plan B.
Plan A should focus on working on both the balance sheet and cashflow of finances.

That drives home the point that moving into condo should not be seen as reaching a destination. It's just a pit stop if you have not achieved financial freedom.

The real benchmark of being 'rich' is when you don't have to work for money. That means that you and I who still need to work to make ends meet are still the middle class.

Some may choose to lead HDB lifestyle but enjoy being financially free. Some may choose to be seen as 'successful' living in big houses and be trapped in rat race.

These are personal choices made by individual's wants. To each his own, comparing the level of success within the middle class is superficial and meaningless.



To drive home the point of being financially free is more important than owning a C,

Sorry to hear about your predicament. Life is unpredictable, today you are healthy and on top of the world but tomorrow all crumbles down when you least expected it. However, there are always blessings in life. In your situation, your ill health make you repent and become a better person. There are many people in this world, including some in this forum, who are proud and arrogant and have no care about the destitutes. You are smart and lucky to have bought a landed property which has enabled you to cash out. Your situation is not bad, you still live in a condo, which is still a prestigious abode.

Originally Posted by Unregistered

I used to earn $150k pa while my wife now earns $105k pa. One year ago, at the age of 42, I had to go into forced retirement due to ill health. I had to sell my landed property for $2.6m and pay off the outstanding mortgage of $500k. The net cash proceeds of $2.1m was used to buy a $1.1m condo (paid in full) and I created a $1m investment portfolio which gives me an annual dividend income of $45k. My annual family income is now $150k while our expenses is $110k. We save $40k pa. Too bad I had to downgrade from a landed to a condo, but what to do, my health is more important than prestige. I am now adapting to condo living, I like the pool and gym as they allow me to exercise more regularly. Not sure how many more years I will live in this world, I am preparing for life after death. I am now more at peace and has stopped my sinful past life of wining, dining, clubbing, partying, etc. Life is short.

Originally Posted by Unregistered

My car is worth around $200k and the outstanding loan is around $100k. So if I sell it off, I'll get back say $80k? In total, conservatively my family's net worth is more than $1m. I know this is not much and there are tons of people who have more. To those people, kudos! To the rest, let's work hard together to achieve a peaceful and stress-free retirement!

So you are one of those who lives in a HDB flat, yet buys luxury cars. This is interesting to me that there is such a difference between where you live and the car you drive. Most people consider a house or flat an investment, but a car is pure consumption. Also, while investing in the stock market can be profitable, most retail investors like you can get burned in the long run and property investment has always been a very good investment in Singapore for the past 30 years.

Would you not consider someone who invests his money rather than spend it as being wiser and more prudent. Also, wouldn't property investment be safer than investing in stocks?

Originally Posted by Unregistered

Many tend to focus on how to 'buy' their dream home (be it a C or a landed) but pay little attention to figure out how to 'own' it. Remember you don't own it if you leverage.

So, downgrading becomes part of the retirement plan. In my view, downgrading is Plan B.
Plan A should focus on working on both the balance sheet and cashflow of finances.

That drives home the point that moving into condo should not be seen as reaching a destination. It's just a pit stop if you have not achieved financial freedom.

The real benchmark of being 'rich' is when you don't have to work for money. That means that you and I who still need to work to make ends meet are still the middle class.

Some may choose to lead HDB lifestyle but enjoy being financially free. Some may choose to be seen as 'successful' living in big houses and be trapped in rat race.

These are personal choices made by individual's wants. To each his own, comparing the level of success within the middle class is superficial and meaningless.



To drive home the point of being financially free is more important than owning a C,

Your conservative ideas belie the fact that most rich Singaporeans made it through leveraged property investment, so buying big expensive condos and houses has actually been what has made people rich. All other things being equal, those who stuck with conservatively trying to pay off their HDB flat didn't make it into the rich category and remained middle class. With the ABSD that the Govt now charges for property investment, Singaporeans are essentially given one shot at it so if the past is to be followed, buy the most expensive property that you can afford even if you have to eat rich and salt fish.

All these scenarios where people went begging on the streets when the property market crashed is nonsense. Singapore never had a problem with Singaporeans being in large negative equity positions. The few who were affected were speculators who bought multiple properties. There is a lot of MAS data and papers that prove this.

Originally Posted by Unregistered

Your conservative ideas belie the fact that most rich Singaporeans made it through leveraged property investment, so buying big expensive condos and houses has actually been what has made people rich. All other things being equal, those who stuck with conservatively trying to pay off their HDB flat didn't make it into the rich category and remained middle class. With the ABSD that the Govt now charges for property investment, Singaporeans are essentially given one shot at it so if the past is to be followed, buy the most expensive property that you can afford even if you have to eat rich and salt fish.

All these scenarios where people went begging on the streets when the property market crashed is nonsense. Singapore never had a problem with Singaporeans being in large negative equity positions. The few who were affected were speculators who bought multiple properties. There is a lot of MAS data and papers that prove this.

Totally agree! Buying property is the fastest and safest way to get rich. Lots of people waste time trying to do business, play stocks and work hard to get promotion and increment, but the amounts they make are pathetic compared to just flipping property.

People keep saying property will crash since 2005, in the end only a small dip in 2008 and it keep continue rising. Even now still got people dreaming of property crash. Meanwhile those who bought properties in the past have been making millions just by signing a few forms.

Only an idiot will spend all his money to pay off HDB and save money in the bank. A lot of daring civil servants now own multiple properties and have passive income that is much more than investment bankers.

Originally Posted by Unregistered

Your conservative ideas belie the fact that most rich Singaporeans made it through leveraged property investment, so buying big expensive condos and houses has actually been what has made people rich. All other things being equal, those who stuck with conservatively trying to pay off their HDB flat didn't make it into the rich category and remained middle class. With the ABSD that the Govt now charges for property investment, Singaporeans are essentially given one shot at it so if the past is to be followed, buy the most expensive property that you can afford even if you have to eat rich and salt fish.

All these scenarios where people went begging on the streets when the property market crashed is nonsense. Singapore never had a problem with Singaporeans being in large negative equity positions. The few who were affected were speculators who bought multiple properties. There is a lot of MAS data and papers that prove this.

I completely agree that riches are made through leverage. My argument was not about being conservative or aggressive in managing one's finances. I was just trying to call out the phenomena where many think they have made it when they stretch to lead a certain lifestyle. So, the gist of my point is we should set goal to achieve financially freedom.

However, what you see happening is that most people probably get to leverage only once in their lifetime and when they retire, they have to downgrade to generate positive cash flow to sustain life after retirement. This is not ideal.

At this point, people who are more aggressive should fortify their balance sheet so that they can leverage more to create a bigger investment portfolio. End in mind is you don't want downgrading be part of the retirement plan.

People who are tad bit conservative, will probably opt for downgrading. People who are conservative will never get here.

I have seen people gone bankrupt during the Asian crisis due to their greed. They borrow money to invest in the stock market or do business. Their loan was pledged against their only home. When the market crashed, their property value plunged, their investments gone and business folded. They had to force sell their home at the worst of times. This is a lesson for me and my family. Never invest with borrowed money, no matter how low the interest rates are. Only invest with money that you can afford to lose and never risk your home. Don't be greedy in trying to get richer. Be content with what you have. Those people who played it safe are now happily retired while those who was bankrupted got divorced and staying in welfare homes.

Originally Posted by Unregistered

I have seen people gone bankrupt during the Asian crisis due to their greed. They borrow money to invest in the stock market or do business. Their loan was pledged against their only home. When the market crashed, their property value plunged, their investments gone and business folded. They had to force sell their home at the worst of times. This is a lesson for me and my family. Never invest with borrowed money, no matter how low the interest rates are. Only invest with money that you can afford to lose and never risk your home. Don't be greedy in trying to get richer. Be content with what you have. Those people who played it safe are now happily retired while those who was bankrupted got divorced and staying in welfare homes.

You will never get far in life with this kind of mentality. Unless you are a high flier career wise, as a normal guy earning 60-80k annual, even if you save 30-40k annual, it will take forever to get anything from investing such low amounts.

Sure you can always laugh at the occassional downtrodden risk taker, but the fact is you will still be stuck in your crappy pigeon hdb hole at the age of 40, praying hard that you boss dun suddenly decide to fire you for someone cheaper while your meagre savings are not enough to last till you die. And then keep psycho-ing yourself to feel good by saying you are contented to work till 65-70 and look at other people failure to console yourself.

Originally Posted by Unregistered

Totally agree! Buying property is the fastest and safest way to get rich. Lots of people waste time trying to do business, play stocks and work hard to get promotion and increment, but the amounts they make are pathetic compared to just flipping property.

People keep saying property will crash since 2005, in the end only a small dip in 2008 and it keep continue rising. Even now still got people dreaming of property crash. Meanwhile those who bought properties in the past have been making millions just by signing a few forms.

Only an idiot will spend all his money to pay off HDB and save money in the bank. A lot of daring civil servants now own multiple properties and have passive income that is much more than investment bankers.

A lot of anti-property speculation propaganda is also spread by the insurance agent. To try and trick people into buying their garbage saving & investment products, they keep scare people with stories about bankruptcy or exaggerate the lousy product returns by showing “projections” that are unrealistic.