How much are you earning per annum?

Hi all,

My wife and I have been following this forum for quite some time. We find it very good as we learnt a lot from the many smart people here. We often discuss the ideas that were shared here and we got inspired to leave the rat race and retire as soon as possible so that we can pursue more meaningful things in our lives such as travelling to exotic places, reading, studying our religion deeper, charity work, etc.

We are now both 40 years old and earn a total income of $160k pa. We own a condo, which has mortgage of $600k and worth $1.2m. Our other assets include cash, CPF and some dividend stocks, worth $500k in total. We own a luxury car which is paid up, left 1 year of its COE. Currently our savings is $40k pa.

Here is our plan to retire early at 55:

1. We will sell our condo at $1.2m, pay off the condo mortgage and use the cash balance of $600k to buy a 4 room HDB flat for $400k. We then have $200k cash avaliable to invest. So now we are debt free and no more loan to service. We will save about $35k pa in mortgage payments.

2. We will sell our car and take the bus. This saves us $25k pa.

3. After all the these moves, we will increase our savings to $100k pa.

4. So, we will start with about $300k to invest in blue chips giving us 4% dividend yield or $12k pa. Every year we will add $100k in investments and the dividend will then increase. Over 15 years, our investment will grow to about $2.5m and the dividend will be $100k pa.
We can then retire at 55 years old with $100k pa passive income.

What do you think of this plan?

my short comment. u got a plan. u prepared mentally to make the switch ?
it seem u r living a rather big change in lifestyle.

it is not just the things u give up. it is how others will perceive you.

as for investment... there r no sure bets. forget what all post are saying about 4% etc... the truth is more like 12% on good year , flat for 2 yrs ... etc
hence timing is impt.

all the best . dont forget insurance

Originally Posted by Unregistered

Hi all,

My wife and I have been following this forum for quite some time. We find it very good as we learnt a lot from the many smart people here. We often discuss the ideas that were shared here and we got inspired to leave the rat race and retire as soon as possible so that we can pursue more meaningful things in our lives such as travelling to exotic places, reading, studying our religion deeper, charity work, etc.

We are now both 40 years old and earn a total income of $160k pa. We own a condo, which has mortgage of $600k and worth $1.2m. Our other assets include cash, CPF and some dividend stocks, worth $500k in total. We own a luxury car which is paid up, left 1 year of its COE. Currently our savings is $40k pa.

Here is our plan to retire early at 55:

1. We will sell our condo at $1.2m, pay off the condo mortgage and use the cash balance of $600k to buy a 4 room HDB flat for $400k. We then have $200k cash avaliable to invest. So now we are debt free and no more loan to service. We will save about $35k pa in mortgage payments.

2. We will sell our car and take the bus. This saves us $25k pa.

3. After all the these moves, we will increase our savings to $100k pa.

4. So, we will start with about $300k to invest in blue chips giving us 4% dividend yield or $12k pa. Every year we will add $100k in investments and the dividend will then increase. Over 15 years, our investment will grow to about $2.5m and the dividend will be $100k pa.
We can then retire at 55 years old with $100k pa passive income.

What do you think of this plan?

Yes, it is a commitment we have to make, short term sacrifice for long term gain. We are not too concerned about what others think, we just tell them this is our early retirement strategy. As for the investment we are not too worried of the capital values but rather the dividend amount. In fact in a bad year, it would be a bargain to buy high dividend yield stocks.

Originally Posted by Unregistered

my short comment. u got a plan. u prepared mentally to make the switch ?
it seem u r living a rather big change in lifestyle.

it is not just the things u give up. it is how others will perceive you.

as for investment... there r no sure bets. forget what all post are saying about 4% etc... the truth is more like 12% on good year , flat for 2 yrs ... etc
hence timing is impt.

all the best . dont forget insurance

Those who want to retire early, look no further. Just retire in Malaysia. But best to avoid JB. There are other many safer places like those in the mountain and hill resorts.

You just need about US$1.7k pm (including rent) to retire. so, if you have a HDB flat and paid up, you can easily rent it out for $3k pm and retire in Malaysia. Truly Asia.

-----------------------------------------------------------------------------------------------

The World’s Best Places to Retire in 2014

Malaysia—Asia’s Best Retirement Haven

Malaysia is the best place to retire in Asia right now, and there’s no sign of that changing. A couple can live comfortably in a luxury ocean-view condo on $1,700 a month including rent. (We know of couples living more modestly on even less…try $1,000 a month, including rent.)

The average temperature is 82 F all year round, and you’ll find some of the best beaches in the world here. There are cool hill stations, mountain retreats from the time of the British Raj, islands to hop or explore by yacht, and heath care is second-to-none.

Penang Island, in the north east and Kuala Lumpur, the country’s capital in the south, are medical centers of excellence. The hospitals are top-notch and the physicians speak English, having been either been trained or completed their postgraduate studies in the U.S. or UK—which makes the cost of health care all the more incredible. You can see a specialist without any need for an appointment for as little as $11. Just turn up. It’s the same with dentists.

Infrastructure here is First World and you’ll have no problem finding high speed Internet or cable TV (Packages cost from $30 a month). If you chose to drive you’ll find the roads are excellent. And when you move to Malaysia you can import a car—and your household goods—duty free.

There is a program that allows non-Malaysians to stay in Malaysia on a social visit pass for 10 years. Called Malaysia my Second Home, it’s automatically renewable for an additional 10 years when it expires. If you are retired, you need a fixed deposit of RM150,000 ($46,707), and you can draw down half that to buy a property, go back to school, or for medical purposes. On top of that you must show proof that you receive a pension from the government of RM10,000 ($3,114) per month. As a rule of thumb the older you are the easier and cheaper it is to join the program.

If you chose to buy property Malaysia makes it easier for you as a foreigner than anywhere else in the region. You can buy freehold and there’s no limit on the number of properties you can own either, just a minimum purchase price set by the local government (it’s $163,500 in Penang).

The country’s diverse ethnic mix makes being a stranger here easy. Whether you live in bohemian Penang or Kuala Lumpur, the country’s hip capital, you’ll meet friendly locals who are happy to stop and chat and welcome you into their home. People are accepting, just ask the international mix of expats all on the same journey as you and happy to share.

Many expats are members of organizations like the American Association of Malaysia and an active social life is easy to find. With good quality dining so cheap (you can have dinner for $3, a gin and tonic is $2) most people find themselves out at least a few times a week.

If you want to keep busy and earn some money, starting your own business is an uncomplicated process. There are expats here running cafés, yoga studios, restaurants, and schools and making money through exporting optic fiber cabling.

Malaysian’s also have a lot of respect for older people; in fact it’s an intrinsic part of their culture. A full-time, live-in maid costs just $400 a month, and single older expats hire maids with nursing abilities, who care for them in the comfort of their own home. Betty Cotton, who lived in San Francisco for many years does just that and wouldn’t be without her live-in maid. “I moved to Malaysia by myself when I was 85 years old. I live in my own home, I have my own things around me, and if I need anything, anything at all, I have great neighbors who are just a phone call away. I wouldn’t live anywhere else.”

://internationalliving.com/2014/...o-retire-2014/

A Singaporean couple can retire comfortably with S$2100 pm in Malaysia. So, if they have passive income of S$3000 pm, then they can retire. They can rent out their HDB flat for S$3000 pm. If they retire at 65, they will get an additional S$2400 pm from the CPF Life, so their passive income at 65 is S$5400 pm. This is more than enough to retire in Malaysia. They can move from one city to another during their retirement. For example, 2 years in KL, 2 years in Malacca, 2 years in Penang, 2 years in KK, 2 years in Chiang Mai, 2 years in Krabi, 2 years in Phuket, 2 years in Koh Samui, etc. Just avoid JB.

Just out of curiosity: why Malaysia? why doesn't anyone suggest retiring in Australia/New Zealand?

The food is healthy, air is clean, housing is cheap and people are friendly.

a lot more expensive to retire in Australia and NZ

Originally Posted by Unregistered

Just out of curiosity: why Malaysia? why doesn't anyone suggest retiring in Australia/New Zealand?

The food is healthy, air is clean, housing is cheap and people are friendly.

Originally Posted by Unregistered

A Singaporean couple can retire comfortably with S$2100 pm in Malaysia. So, if they have passive income of S$3000 pm, then they can retire. They can rent out their HDB flat for S$3000 pm. If they retire at 65, they will get an additional S$2400 pm from the CPF Life, so their passive income at 65 is S$5400 pm. This is more than enough to retire in Malaysia. They can move from one city to another during their retirement. For example, 2 years in KL, 2 years in Malacca, 2 years in Penang, 2 years in KK, 2 years in Chiang Mai, 2 years in Krabi, 2 years in Phuket, 2 years in Koh Samui, etc. Just avoid JB.

This sounds exciting, just to add, can include cities in S America (Panama, Ecuador), Spain, Eastern Europe, etc.

Singaporeans are very lucky. Most of them (95% I think) are home owners. Many bought cheap BTOs and now the value of their flats have gone up. The older folks who bought their flats in the 1980s for less than $100k, now see their flat's value gone up to $500k and above. Some sell their flat and retire, many rent out their rooms to get passive income.

Our home ownership policy and asset enhancement programe is a huge success. These policies have enabled many Singaporeans to retire, even for those who don't earn so much. But there are those who sell their flat and gamble it away or got conned or scammed. That is why we must have the minimum sum and CPF Life schemes to protect these people.

We must continue to support our asset enhancement programe to enable us to retire happily.

Should try and talk to people you know who have already retired, in the age group you envisaged to retire at. You should then be able to get a glimpse of what it is like to retire at that age. People of our parents' generation have different expectation when they retired. For them, seeing us grow up, start our own families and in good jobs was enough satisfaction for them. So their retirement years were spent living simple lifestyles.

But for us, will we be satisfied to live simple lifestyles in our retirement, especially at 55? No matter what people planned to do during their retirement years, they will quickly find boredom once routine sets in if they do not find something to do that is engaging enough. Just like work, retiring happy requires some commitment to do the things you planned. Otherwise you will end up listless.

I have colleagues who retired at 55 because they can afford to. They have made astute investments during their working years and are now enjoying the returns. Although they have no worries financially, some of them admitted they were bored and have taken up new jobs. As their children have grown up, and their spouses still working, it can get very lonely at home. Worst of all they still feel energetic.

If your work is not unbearable, I would advise working as long as you can. You can still travel to exotic places during your annual leave like what I am doing. Like my colleagues, I can retire now but I don't want to rush into the lifestyles they are leading right now.

I have hobbies lined up once I retire, but I worry they may not be sustaining and then I would be very bored and it would difficult to get back into the workforce.

We should always plan for retirement especially the financial part, but think carefully before letting go your job because work makes up a big chunk of our lives. It gives us purpose.

Originally Posted by Unregistered

Hi all,

My wife and I have been following this forum for quite some time. We find it very good as we learnt a lot from the many smart people here. We often discuss the ideas that were shared here and we got inspired to leave the rat race and retire as soon as possible so that we can pursue more meaningful things in our lives such as travelling to exotic places, reading, studying our religion deeper, charity work, etc.

We are now both 40 years old and earn a total income of $160k pa. We own a condo, which has mortgage of $600k and worth $1.2m. Our other assets include cash, CPF and some dividend stocks, worth $500k in total. We own a luxury car which is paid up, left 1 year of its COE. Currently our savings is $40k pa.

Here is our plan to retire early at 55:

1. We will sell our condo at $1.2m, pay off the condo mortgage and use the cash balance of $600k to buy a 4 room HDB flat for $400k. We then have $200k cash avaliable to invest. So now we are debt free and no more loan to service. We will save about $35k pa in mortgage payments.

2. We will sell our car and take the bus. This saves us $25k pa.

3. After all the these moves, we will increase our savings to $100k pa.

4. So, we will start with about $300k to invest in blue chips giving us 4% dividend yield or $12k pa. Every year we will add $100k in investments and the dividend will then increase. Over 15 years, our investment will grow to about $2.5m and the dividend will be $100k pa.
We can then retire at 55 years old with $100k pa passive income.

What do you think of this plan?