How much are you earning per annum?

Originally Posted by Unregistered

Age: 42, 40.
Married couple with two children (g9,b6).
We earn $860K (assessable income for YA2016) so around $71.6K a month but more than 30% of the total comes from discretionary bonus. We save $31k pm.
Home: Leasehold terrace worth $2.1m. Mortgage outstanding $1.6m. Mortgage instalment $5500 pm using cash (up to 2015, home was a hdb fully paid up worth $800K, now rented out at $2.8k per month and for offsetting the mortgage payment)
6-yr old car fully paid up (ard $80k value).
Liquid assets (cash/CPF/investments) $2.8m
Illiquid assets (pty invts [2 local 3 foreign pties], unvested stock awards, cash value of ins policies) net value $2m
Total net worth around $5.3m

I know we are very comfortable compared to general population and this post is not to brag. My main concerns are:

a) now past 40 yrs old, how long can I continue earning current salary (I hope to retire at 60 by which time hopefully can get to $10m n/w)

b) kids are still relatively young, and education is quite stressful (for them and for us), concerned about their future (ins coverage around $8m so not worried financially if I die but more about whether they can survive in this uncertain world)

c) trying to build and increase annuity streams to match my salary (still long way off) but dividends/interest/cap gains now can just cover expenses (abt $15K per mth)

d) still supporting elderly parents (in their 80s) and being mentally prepared for the emotional roller-coaster that I will go thru shortly in terms of their failing health and future demise.

i would retire already if i were you. no way i will want to work till 60. $15K passive income is very comfortable. can always liquidate some assets if need more money for the kids.

for us (late 30s), a big chunk of net worth is in our freehold landed home ($2.7M). only slightly over $1.2M in financial and other assets, but plan to retire by 50 (move to cheaper home if need be). savings rate around $150K per annum, and agree it's a good idea to start putting some money in annuities.

Why retire when the going is good?

The fact of the matter is, the younger you are, the more you will need to retire, while if you were older, you will need less.

For eg., $1m will probably be more than enough for a 70 yo. in retirement. But will be dicey for a 55 yo. And definitely inadequate for a 45 yo to consider retirement.

Similarly $5.3m would not be adequate for him to retire at 42/40 some more with young children to bring up and educate.

Even for us in our mid 50s, with $5.8m in networth, and our children already working, we are still not thinking of retiring just yet.

Originally Posted by Unregistered

i would retire already if i were you. no way i will want to work till 60. $15K passive income is very comfortable. can always liquidate some assets if need more money for the kids.

for us (late 30s), a big chunk of net worth is in our freehold landed home ($2.7M). only slightly over $1.2M in financial and other assets, but plan to retire by 50 (move to cheaper home if need be). savings rate around $150K per annum, and agree it's a good idea to start putting some money in annuities.

It is not just wealth generation but wealth preservation is even more important.

Originally Posted by Unregistered

i would retire already if i were you. no way i will want to work till 60. $15K passive income is very comfortable. can always liquidate some assets if need more money for the kids.

for us (late 30s), a big chunk of net worth is in our freehold landed home ($2.7M). only slightly over $1.2M in financial and other assets, but plan to retire by 50 (move to cheaper home if need be). savings rate around $150K per annum, and agree it's a good idea to start putting some money in annuities.

You are doing a lot better than most people. You're in the upper middle income group and among the top few who owns and lives in a condo. Your condo is 80% paid up. Only 15% of the population lives in a condo. 80% lives in public housing. You're lucky, very lucky.

When you retire at 65, you would have saved $720k, assuming you're 45 now. You can use this to buy annuities for you and spouse. This will give you a monthly payment until you die. At 65, your CPF Life will also start paying. So with the annuity and CPF Life payments, you should be able to retire comfortably, staying in your condo. If you don't mind a smaller place, you can always sell your current big condo and buy a studio condo and use the extra cash to buy more annuities which will give your more monthly payout.

Congratulations on your current achievements of owning a condo and a car. You are very fortunate. Do not forget to help the poor and needy. Don't be greedy.

Originally Posted by Unregistered

I thank the many people here who share their finances. I'm motivated to share ours to get opinions on how our situation is.

Age: Mid 40s.
Married couple with two children.
We earn $15k pm (total annual income divided by 12). We save $3k pm.
Home: Mass market condo, less than 5 years old, worth $950k. Mortgage outstanding $190k. Mortgage instalment $1200 pm using CPF. MSR (mortgage servicing ratio) = 8% only.
Car is fully paid up in cash.
Cash and CPF savings in total $600k.
Total net worth (condo net asset value + cash + CPF + car) $1.43m.

We are almost debt free, our only loan is the $190k outstanding condo mortgage.
We save $36k pa. Our TDSR (total debt servicing ratio) is only 8%. Current ruling on TDSR is 60%.

How are we doing financially? Any financial experts here?

Originally Posted by Unregistered

i would retire already if i were you. no way i will want to work till 60. $15K passive income is very comfortable. can always liquidate some assets if need more money for the kids.

for us (late 30s), a big chunk of net worth is in our freehold landed home ($2.7M). only slightly over $1.2M in financial and other assets, but plan to retire by 50 (move to cheaper home if need be). savings rate around $150K per annum, and agree it's a good idea to start putting some money in annuities.

We plan to retire in JB when we reach 55. By then our children will be working and financially independent. Most likely they would be married and living in their BTO HDB flats.

When we retire in JB, we will rent out our paid up condo in Singapore and get a rental of about $3k pm. On top of that we will have other passive income of $1k pm. So our passive income will be $4k pm or RM11k pm. This is a lot for a retired couple.

We can rent a condo in JB for RM1k pm. Our food and utilities will be about RM2k pm as we like to eat good food at restaurants. Our other expenses like car expenses will be about another RM1k. We don't worry about any major health expenses (hope we don't need them) as we have bought health insurance for many years. So we just need RM4k pm and can save the rest. We can use part of the savings to travel the world.

Where do you plan to retire? How is your retirement plan like?

Originally Posted by Unregistered

We plan to retire in JB when we reach 55. By then our children will be working and financially independent. Most likely they would be married and living in their BTO HDB flats.

When we retire in JB, we will rent out our paid up condo in Singapore and get a rental of about $3k pm. On top of that we will have other passive income of $1k pm. So our passive income will be $4k pm or RM11k pm. This is a lot for a retired couple.

We can rent a condo in JB for RM1k pm. Our food and utilities will be about RM2k pm as we like to eat good food at restaurants. Our other expenses like car expenses will be about another RM1k. We don't worry about any major health expenses (hope we don't need them) as we have bought health insurance for many years. So we just need RM4k pm and can save the rest. We can use part of the savings to travel the world.

Where do you plan to retire? How is your retirement plan like?

Do the math properly. In JB, no need electricity bill? No aircon?No astro? Phone/internet bill? No car? Petrol? 2k / 30days = 66rm one day for 2 persons enough for restaurant? Fast food restaurant? For RM 1k condo in JB, check if those locations are safe enough.

Originally Posted by Unregistered

Age: 42, 40.
Married couple with two children (g9,b6).
We earn $860K (assessable income for YA2016) so around $71.6K a month but more than 30% of the total comes from discretionary bonus. We save $31k pm.
Home: Leasehold terrace worth $2.1m. Mortgage outstanding $1.6m. Mortgage instalment $5500 pm using cash (up to 2015, home was a hdb fully paid up worth $800K, now rented out at $2.8k per month and for offsetting the mortgage payment)
6-yr old car fully paid up (ard $80k value).
Liquid assets (cash/CPF/investments) $2.8m
Illiquid assets (pty invts [2 local 3 foreign pties], unvested stock awards, cash value of ins policies) net value $2m
Total net worth around $5.3m

I know we are very comfortable compared to general population and this post is not to brag. My main concerns are:

a) now past 40 yrs old, how long can I continue earning current salary (I hope to retire at 60 by which time hopefully can get to $10m n/w)

b) kids are still relatively young, and education is quite stressful (for them and for us), concerned about their future (ins coverage around $8m so not worried financially if I die but more about whether they can survive in this uncertain world)

c) trying to build and increase annuity streams to match my salary (still long way off) but dividends/interest/cap gains now can just cover expenses (abt $15K per mth)

d) still supporting elderly parents (in their 80s) and being mentally prepared for the emotional roller-coaster that I will go thru shortly in terms of their failing health and future demise.

me and wife 45. just checked that our FY2016 assessment income just hit $500k. but we don't have as much net assets as you do. congratulations for doing so well.

Originally Posted by Unregistered

Do the math properly. In JB, no need electricity bill? No aircon?No astro? Phone/internet bill? No car? Petrol? 2k / 30days = 66rm one day for 2 persons enough for restaurant? Fast food restaurant? For RM 1k condo in JB, check if those locations are safe enough.

We have done our Maths. Are you a JB expert who knows more than we do?

Condo rental is cheap because of oversupply. Many buyers of Johor condos are investors. They have difficulty renting out their condos as supply is a lot greater than demand. They have to rent cheap or else will be empty for a long time. You can get cheap condo rentals even in good, safe location.

Originally Posted by Unregistered

me and wife 45. just checked that our FY2016 assessment income just hit $500k. but we don't have as much net assets as you do. congratulations for doing so well.

Tks. It was through sheer hard work and a fairly extreme level of forced savings that got us where we are.. also as I said we moved to our current place after living in a hdb for the last 2 years which helped a lot in terms of savings thru utility rebates, Gst rebates, low pty taxes etc..it also helps to have a frugal wife, I just can't get her to spend money (the book The Millionaire Next Door really is true).

To the post on buying annuities you are mistaken. What I meant is income streams that come in every month thru interest, dividends and cap gains. I don't intend to buy annuities until cpf Life hits me.

As I mentioned I save $31k a month so even without other income stream my network has increases close to $450k a year so theoretically I can get to $10m nw in 10 years time but it doesn't take into account major expenditure such as kids education (particularly if it's overseas) and others which is where my concern lies.

Originally Posted by Unregistered

Tks. It was through sheer hard work and a fairly extreme level of forced savings that got us where we are.. also as I said we moved to our current place after living in a hdb for the last 2 years which helped a lot in terms of savings thru utility rebates, Gst rebates, low pty taxes etc..it also helps to have a frugal wife, I just can't get her to spend money (the book The Millionaire Next Door really is true).

To the post on buying annuities you are mistaken. What I meant is income streams that come in every month thru interest, dividends and cap gains. I don't intend to buy annuities until cpf Life hits me.

As I mentioned I save $31k a month so even without other income stream my network has increases close to $450k a year so theoretically I can get to $10m nw in 10 years time but it doesn't take into account major expenditure such as kids education (particularly if it's overseas) and others which is where my concern lies.

does your kids need you to pay for their overseas education? or are they smart enough to secure a scholarship?