How much are you earning per annum?

Hi

I would like to share our finances. We are a couple in our 40s, earning a combined income of $218k pa. We live in a 2 bedroom condo, currently worth $1m. We still have a mortgage of $190k left. We own a car which we paid up last year. Our only debt is the condo mortgage which we use our CPF to pay.

We lead a simple, middle income, middle class lifestyle. Our annual expenditure is about $170k pa. We enjoy life by eating at restaurants regularly and going to oversea holidays twice a year. We are also very generous to our parents and give them generous monthly allowances. We are blessed with good health and a happy family.

We hope to retire in our current condo and aim to pay off our mortgage in a few years' time.

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You have achieved a lot because

1. You own a condo. In Singapore, I think only 15% live in condos. About 80% live in public housing. To own and live in a condo in Singapore is a big achievement.
2. You own a car. You can travel in comfort and fast.
3. Your debt is small relative to your income.
4. You are generous to your parents. Thumbs up!
5. You have good health.
6. You get to travel around the world and eat good food at restaurants. How lucky!
7. You have a happy family. Best achievement ever!

You are very successful because you have material wealth, good life experiences, and most importantly the love and care of your loved ones. Well done and congratulations!

Originally Posted by Unregistered

Hi

I would like to share our finances. We are a couple in our 40s, earning a combined income of $218k pa. We live in a 2 bedroom condo, currently worth $1m. We still have a mortgage of $190k left. We own a car which we paid up last year. Our only debt is the condo mortgage which we use our CPF to pay.

We lead a simple, middle income, middle class lifestyle. Our annual expenditure is about $170k pa. We enjoy life by eating at restaurants regularly and going to oversea holidays twice a year. We are also very generous to our parents and give them generous monthly allowances. We are blessed with good health and a happy family.

We hope to retire in our current condo and aim to pay off our mortgage in a few years' time.

Good observation. In Singapore, if you own BOTH a condo and a car, you could probably be considered as in the top 5% or 6% financially. If both your condo and car are fully paid up, you can even be in the top 1% or 2% since there are people who own both condo and car but they are still in debt.

Originally Posted by Unregistered

You have achieved a lot because

1. You own a condo. In Singapore, I think only 15% live in condos. About 80% live in public housing. To own and live in a condo in Singapore is a big achievement.
2. You own a car. You can travel in comfort and fast.
3. Your debt is small relative to your income.
4. You are generous to your parents. Thumbs up!
5. You have good health.
6. You get to travel around the world and eat good food at restaurants. How lucky!
7. You have a happy family. Best achievement ever!

You are very successful because you have material wealth, good life experiences, and most importantly the love and care of your loved ones. Well done and congratulations!

Originally Posted by Unregistered

Good observation. In Singapore, if you own BOTH a condo and a car, you could probably be considered as in the top 5% or 6% financially. If both your condo and car are fully paid up, you can even be in the top 1% or 2% since there are people who own both condo and car but they are still in debt.

It is best to clear your debt as fast as possible. If you clear your mortgage, you can sleep peacefully at night. So even if you lose your job, you still have a roof over your head. Some more, you have the option to downgrade to a cheaper home and get some cash.

For instance, if you are a banker and got retrenched, you can sell your fully paid D9 condo for $2m and downgrade to a $500k five room HDB flat. You can invest the $1.5m cash balance in a basket of dividend stocks giving you $75k pa in dividends assuming a 5% dividend yield. You can still live comfortably with $75k pa income provided you don't drive and employ a maid.

Originally Posted by Unregistered

Good observation. In Singapore, if you own BOTH a condo and a car, you could probably be considered as in the top 5% or 6% financially. If both your condo and car are fully paid up, you can even be in the top 1% or 2% since there are people who own both condo and car but they are still in debt.

I will be alarmed if all it takes to be in the top 5% is a condo and a car albeit fully paid.

I think your thresholds are way too low.. Do you know that approx 10% of HHs have > 1 property in Sg? if we assume they are a fully paid hdb (let's say 600k) & a 30% paid up condo of 1.2milliom, that would mean a full 10% of HHs in Singapore have about 1m in property assets.

A fully paid up condo and a fully paid up car just implies around 1.3million of assets so I don't believe that the gap between the top 10% and 5% is a mere 300k.....

Originally Posted by Unregistered

Good observation. In Singapore, if you own BOTH a condo and a car, you could probably be considered as in the top 5% or 6% financially. If both your condo and car are fully paid up, you can even be in the top 1% or 2% since there are people who own both condo and car but they are still in debt.

Poor Singaporean.
Having one condo (Flat?) and one car already considered at the top 5% or 6% echelon.
If you are having a landed terrace/bungalow, and two cars, you must then already at top 1%?
After paying off your debt, how much cash asset do you still have to see you through your golden ages?
To support a discern life style after you have retired, you may need at least cash assets not less than 10 years equivalent of your last annual take home pay. That should not include your car and your fully paid home, unless you prepare to settle with a lesser life style......

Here is how the % is calculated

% of HH living in condo 13.5%
% of HH owning a car 45%
So, if a HH living in condo and own a car, it will be = 0.45x0.135 = 6%.
You learn this in probability lesson in secondary school.
Assuming, only 30% of these HH have fully paid condo and car, it will then be 1.8%

It is easy to be debt free. You just need to be humble. If you don't earn so much, don't buy an expensive condo, just be happy with a BTO flat. If you don't earn so much, don't buy an expensive $150k new car, just buy a cheap $100k new car. Don't take big loans for your home. You should pay a downpayment of 50% or more when buying a property, so that even if the property price drops by 40%, you will not be under water. Be debt free as fast as you can and lead a peaceful life. You will feel more confident as a person if you're debt free.

I sold my landed property a few years ago and downgraded to a luxury condo. I manage to make a profit from selling my landed property and use the sale proceeds to buy the condo. I am left with only a small loan on the condo. I also bought a new car which I paid in full. I can now sleep in peace.

Just heard that my bro in law just got a sports car for himself, and a Merz for his wife. Both waiting delivery before CNY next year. Wow Singaporeans are really cash rich. No wonder my hopes of COE crashing to $30k can dream on......