How much are you earning per annum?

Bought HDB flat many years ago for $100k. Now paid up.
50, $68k pa. Spouse, 52, $70k pa.
Son in JC.
Cash and CPF, combined, $400k.
We plan to retire when we reach 65.
Will get the CPF Life, $1200 pm each.
Will rent out two of our rooms to FTs at $1000 pm.
Sons' contributions, $1000 pm
Total passive income, $5400 pm.
Spendings, $3000 pm for food, utilities and transport.

Our retirement trategy:
1. Buy cheap HDB flat and pay off loan as fast as possible.
2. Rent out rooms to FTs.
3. Have children so that they can contribute monthly allowance.
4. Meet CPF minimum sum so we can get CPF Life money.

Originally Posted by ks55

From what I observed in this forum, many tend to use the term how much they earn, how much they save, how much net asset worth now etc.

Financial independence when you retire does not take into consideration all these things. Mike Tyson may earn millions in a single fight, that doesn't make him live comfortably in later part of his life.

Many stated in this forum their net worth is more than 1.0m. Look carefully, the 1.0m comprises mainly of condo at present value 1.5m less 600k loan outstanding. Other assets presumably comprise of cash, share, car, and CPF saving.

Please take note property price may go up and down. Property needs maintenance, need to pay taxes and insurance.

To achieve financial independence means that you can live with the quality of life similar to what you have while in full employment. Need not think thrice to spend extra few dollar here and there. Able to replace household items and mode of transport when necessary. Up keep and house maintenance as usual.

Simple test whether you have achieve financial independence will be :

1. You have a mortgage-free home.
2. If you have cash asset equivalent to 100 times last draw monthly gross pay (i.e before tax, CPF contribution, or what ever deduction).
3. If you can generate 65% replacement income from your nest eggs.
4. If you are paying 20% income tax at the time of retirement.
5. If you have been saving in what ever form (or commitment) at 15% of your last drawn gross pay and nil when retire.
6. If you can earn 10% ROI pa on your nest eggs consistently.
7. If inflation does not exceed 4% pa.
8. If you only spend up to the replacement income every year (already inclusive of 4% inflation per year);
9. If you do not intend to leave anything to your children other than the house you are staying.
10. If you do not live longer than 79 years (4 year longer than life expectancy right now).

So, when you already achieved the above criteria, regardless of your age (age 40, 50, 60 up to you), you should be able to live the same quality of life at the time of your retirement.

Note: Cash asset to include CPF, cash, FD, share, bonds, unit trusts, second house that can generate income. By no means contribution from children to be included.

Why should we make our live so difficult? As long as we have CPF Life (husband and wife 2.4k a month), reside in Malaysiawith rm 6k should be sufficient.

Originally Posted by Unregistered

This is stupid people thinking. The way to retire well is to retire somewhere cheaper. So many people are now retired in Malaysia. They have a paid up flat and now renting them out at $3k pm. They also have passive income of $2k pm from dividends, CPF, etc. So they get $5k pm or RM12.5k pm. They rent a nice condo in KL for RM2k pm and spends RM5k pm for food, car, utilities, holidays, etc and can save the rest. No need to think too much.

Me and wife want to stay in Ipoh when retire next year. Rent 1s house rm 450 pm, buy a secondhand motorcycle rm 2500, food rm 350 pm, petrol rm 30 pm, electric and water rm 50 pm, gas rm 28 pm, others rm 100 pm. No road tax. Excluding one off motorcycle purchase, plan to survive with SD5000 pa. Can't help, low pay, no saving.

You can rent out your flat at $3k pm. Plus your CPF Life and kids' allowance, you will get $6400 pm (RM16,000 pm) of passive income. You can retire in a posh penthouse in KL or Penang, with rent of only RM5k pm. You also have enough to drive a nice car, eat at nice restaurants and still have spare cash to go for holidays.

Don't retire in JB, very high crime rate. Not safe. Not worth your precious life.

Originally Posted by Unregistered

Bought HDB flat many years ago for $100k. Now paid up.
50, $68k pa. Spouse, 52, $70k pa.
Son in JC.
Cash and CPF, combined, $400k.
We plan to retire when we reach 65.
Will get the CPF Life, $1200 pm each.
Will rent out two of our rooms to FTs at $1000 pm.
Sons' contributions, $1000 pm
Total passive income, $5400 pm.
Spendings, $3000 pm for food, utilities and transport.

Our retirement trategy:
1. Buy cheap HDB flat and pay off loan as fast as possible.
2. Rent out rooms to FTs.
3. Have children so that they can contribute monthly allowance.
4. Meet CPF minimum sum so we can get CPF Life money.

Originally Posted by Unregistered

Me and wife want to stay in Ipoh when retire next year. Rent 1s house rm 450 pm, buy a secondhand motorcycle rm 2500, food rm 350 pm, petrol rm 30 pm, electric and water rm 50 pm, gas rm 28 pm, others rm 100 pm. No road tax. Excluding one off motorcycle purchase, plan to survive with SD5000 pa. Can't help, low pay, no saving.

What's is the point of after working for so hard for years and at last you have to reside in a small town somewhere outside Singapore where most of your friends, families are here.. and living miserably there.. (need to rent a house from ppl). The funniest part is get a motorcycle.. You can tell your new neighbours in Ipoh that you love Ipoh but they will laugh at you behind.. cannot afford to retire in SG that's why live miserably in Ipoh at your old age where you supposed to enjoy and spend your earnings with things you like.. unless you tell me you like to ride a bike...

Originally Posted by Unregistered

Me and wife want to stay in Ipoh when retire next year. Rent 1s house rm 450 pm, buy a secondhand motorcycle rm 2500, food rm 350 pm, petrol rm 30 pm, electric and water rm 50 pm, gas rm 28 pm, others rm 100 pm. No road tax. Excluding one off motorcycle purchase, plan to survive with SD5000 pa. Can't help, low pay, no saving.

You can rent out your HDB flat and get passive income. Do you have a paid up HDB flat?

NTU/EEE Fresh grad, 26
electrical engineer
$45k pa

Is it decent?

Originally Posted by Unregistered

This is stupid people thinking. The way to retire well is to retire somewhere cheaper. So many people are now retired in Malaysia. They have a paid up flat and now renting them out at $3k pm. They also have passive income of $2k pm from dividends, CPF, etc. So they get $5k pm or RM12.5k pm. They rent a nice condo in KL for RM2k pm and spends RM5k pm for food, car, utilities, holidays, etc and can save the rest. No need to think too much.

This is a stupid reply from someone...
Having $5k every month, you cannot retire here in Sg?
Have you been to KL before? Rent a nice condo in KL for RM2k pm? You probably have not step out of Sg before... RM2k will only get you an average condo same size as a 3-room flat outside of KL. Unless you are talking about a small town with no fast food outlets in Malaysia, which for Singaporeans who are so worried of food hygiene, clean water, safety, walking distance to Starbucks, hypermarket, do you think is possible for you to stay there? Food wise, you can get $2.5 noodle at a decent foodcourt, the same place in KL cost you RM6.. which one is cheaper? Singapore is cheap enough, for a decent life style.. You can move to Thailand.. but to live with same lifestyle in Sg, it will cost you more.. wake up folks.. dont just sit in front of your pc and giving advise if you yourself are not exposed enough.. blind lead blind.. heard of it?

Originally Posted by ks55

How much do you think it is enough to retire comfortably, normal living, subsistence living or mere surviving? Well, it is up to individual.
If you can afford to spend a million dollar a year, you live like a king.
If you can afford 100k a year, you live a normal life.
If you can only foot out 12k a year, you may have to work till the end of your world.
Quality of your retirement life really depends on how much you have saved, and it is not so complex as so many people think.

There is a simple way to gauge your financial standing at your retirement on how much you can afford to spend with the following assumptions:-
1. You have a mortgage free house/apartment.
2. You can generate 10% income (tax free) a year from your nest eggs.
3. Inflation is at 4% and below.
4. You are living(or surviving) with your nest eggs through your life span with adjusted inflation rate of 4%, and without eating into your nest eggs.

So, how much do you think you can spend (X) every year if you have 1 million at the beginning of your retirement?

Here is the magic formula :-

1000k = X/(0.1-0.04)
or X = 0.06 x 1000k
= 60k
i.e. You can spend up to 5k a month through life plus adjusted inflation of 4% a year.

If you have 2 million, you can spend up to 10k a month etc.

What happen if you can only generate 8% tax free income on your nest eggs?
The amount (X) you can spend will be:-
X = 0.04 x 1000k
= 40k

Your problem will be:
Can I earn 10% a year? 8% a year?
It is achievable. Please consult your financial planner.

Note: X is the amount one year after you have retired (i.e after income earned from your nest eggs)

Bet this guy is a financial product promoter... Noticed too many of these ppl here.. posting ridiculous salary to attract you or with all their financial theory and advise to others... which they might be out of job next month because colud not achieve their sales target..

You are the stupid moron.
If retire in Spore, you can't rent out your hdb flat and you may not want to rent your rooms because you value your privacy. So you only have $2k pm. How to live with $2k?
There are many nice, brand new 3 bedroom condos renting out at $2k pm, just look at property guru Malaysia.
Looks like you are the ignorant one. LOL.

Originally Posted by Unregistered

This is a stupid reply from someone...
Having $5k every month, you cannot retire here in Sg?
Have you been to KL before? Rent a nice condo in KL for RM2k pm? You probably have not step out of Sg before... RM2k will only get you an average condo same size as a 3-room flat outside of KL. Unless you are talking about a small town with no fast food outlets in Malaysia, which for Singaporeans who are so worried of food hygiene, clean water, safety, walking distance to Starbucks, hypermarket, do you think is possible for you to stay there? Food wise, you can get $2.5 noodle at a decent foodcourt, the same place in KL cost you RM6.. which one is cheaper? Singapore is cheap enough, for a decent life style.. You can move to Thailand.. but to live with same lifestyle in Sg, it will cost you more.. wake up folks.. dont just sit in front of your pc and giving advise if you yourself are not exposed enough.. blind lead blind.. heard of it?