How much is your annual passive income?

45 yo couple

Annual passive income

$18k dividends from Singapore stocks
$8k dividends from US stocks
$24k interest from CPF accounts

$50k total for now

Waiting to buy 2nd property and turn one into rental income, target $30k

We are roughly in the same group, me and wifey are both 56.

Our combined passive income (2016 figures)

1. Dividends - $55k
2. Rental - $40k (gross)
3. Interest from FDs - $5k
4. CPF (all accounts) - $60k (of which $18k was from our RA, cannot touch until 65)

Total passive income : $160k

Our retirement plan - to depend on CPF as the main source of income. The secondary sources would the dividends and rentals, which are highly volatile and very dependent on market conditions.

At 65, we should be receiving $45k - $48k from CPF Life, and another $48k - $50k of yearly interests from our OA and SA. The total from CPF would be $93k to $98k pa while our expenses should be $84k pa or $7k pm.

Originally Posted by Unregistered

Couple 55 & 59

Passive income: $400-450K varies depending on dividends. Expenses about $300k so still saving and reinvesting about $100-150k per year. About $45k per year in CPF interest remains in CPF. Redeploying $900k of CPF in Ordinary Accounts into higher yielding investments could potentially give us another $30k in extra passive income, but keeping it there for a rainy day and 2.5% is fine. Expecting another $48-60k combined per year from our SRS accounts when we both hit 62. We have property investments, but don't rent them out. Some relatives live in them. CPF Life should also give us about $40k per year in income when we both hit 65. So our passive income is expected to continue to rise over time and I estimate will reach $600k by the time we are 65.

Sources:

CPF: $45k from both of us based on $1.5m+ in CPF with both retirement accounts topped up and currently $250-260k each. Ordinary accounts around $900k+
About $400K in 2016 from $7.5m portfolio of high dividend blue chips, REITS, preference shares, bond ladders

Hi,

Thank you for your posting.

Your number is reasonable and I guess both of you are high-income earner and rather conservative investors.

To achieve your passive income, I think both of your combined income is in the range of $450-600K/year.

I am unable to hit such salary level. Have to save and invest more, starting from CPF, insurance, structured notes, UT.

Do you leverage in your portfolio of $7.5M or is it full cash investment?

Thanks

Originally Posted by Unregistered

Couple 55 & 59

Passive income: $400-450K varies depending on dividends. Expenses about $300k so still saving and reinvesting about $100-150k per year. About $45k per year in CPF interest remains in CPF. Redeploying $900k of CPF in Ordinary Accounts into higher yielding investments could potentially give us another $30k in extra passive income, but keeping it there for a rainy day and 2.5% is fine. Expecting another $48-60k combined per year from our SRS accounts when we both hit 62. We have property investments, but don't rent them out. Some relatives live in them. CPF Life should also give us about $40k per year in income when we both hit 65. So our passive income is expected to continue to rise over time and I estimate will reach $600k by the time we are 65.

Sources:

CPF: $45k from both of us based on $1.5m+ in CPF with both retirement accounts topped up and currently $250-260k each. Ordinary accounts around $900k+
About $400K in 2016 from $7.5m portfolio of high dividend blue chips, REITS, preference shares, bond ladders

Originally Posted by Unregistered

That is pathetic. BY that age each should have at least USD10m minimum. Need to catch up man.

The $7.5m is just our listed investments. Our properties are worth more than that. It's just that we decided not to rent them out and the investments generate more than enough cashflow. Although I'm 59, I actually retired quite a few years ago. My original target was $1m of income a year off $50m of assets, but I figured I would have had to work until at least 60 and I got lazy.

Originally Posted by Unregistered

We are roughly in the same group, me and wifey are both 56.

Our combined passive income (2016 figures)

1. Dividends - $55k
2. Rental - $40k (gross)
3. Interest from FDs - $5k
4. CPF (all accounts) - $60k (of which $18k was from our RA, cannot touch until 65)

Total passive income : $160k

Our retirement plan - to depend on CPF as the main source of income. The secondary sources would the dividends and rentals, which are highly volatile and very dependent on market conditions.

At 65, we should be receiving $45k - $48k from CPF Life, and another $48k - $50k of yearly interests from our OA and SA. The total from CPF would be $93k to $98k pa while our expenses should be $84k pa or $7k pm.

You didn't put any money into SRS?

To get $50K from your Ordinary Account at 65 (since your Special Account gets transferred to the Retirement Account for CPF Life and contributions to the Special account fall dramatically after 55), you need bout $2,000,000 or $1m each in your Ordinary account. That might be too much liquidity to have around and not deployed into higher yielding investments.

Originally Posted by Unregistered

Hi,

Thank you for your posting.

Your number is reasonable and I guess both of you are high-income earner and rather conservative investors.

To achieve your passive income, I think both of your combined income is in the range of $450-600K/year.

I am unable to hit such salary level. Have to save and invest more, starting from CPF, insurance, structured notes, UT.

Do you leverage in your portfolio of $7.5M or is it full cash investment?

Thanks

I've been retired for some time and also have properties that are worth more than the investment portfolio. I have leverage but I apply a maximum 20% LTV for both listed investment portfolios and properties. So I do use a little leverage, but for most people it would seem like a staggering loan. Just that the assets are even larger. The loans were to generate more cash flow in the last 8 years of low interest rates, but not enough to get into trouble. I can close down the loans completely at the expense of some cashflow, hence less savings, but I haven't seen the need to yet. If interest rates rise, I will rebalance the portfolio into more short-term fixed income note structures from equities. See how.

We have SRS too, only $260k combined, as we started contribution late. We didnt include the SRS money as one of the retirement fund sources as we intend to use it up over 10years (from age 62) at a drawdown rate of $26k pa.

And I agree that having $2m in our CPF OA and SA is holding too much liquidity. But we are happy with the 2.5+% interest rate from the CPF while waiting for opportunity for investment. If there is another market or economic downturn we will be ready just like when we bought our 2 properties - one in 2003 SARS period and one in 2008/9. In the meantime, $60k pa interest income from CPF is not too shabby.

As we are passed 55, we also want to move away from riskier investments, so unless any market correction (property and stocks) is deep, we will maintain our status quo of investment holdings and keep the money in CPF.

And yes, we have no debt. This peace of mind is really priceless.

Originally Posted by Unregistered

You didn't put any money into SRS?

To get $50K from your Ordinary Account at 65 (since your Special Account gets transferred to the Retirement Account for CPF Life and contributions to the Special account fall dramatically after 55), you need bout $2,000,000 or $1m each in your Ordinary account. That might be too much liquidity to have around and not deployed into higher yielding investments.

Everyone looks rich in this forum

So much passive income flowing in

Singapore has no Poor people

Only those who have done well will share

There are poor people

Dont believe everything you read here lah!

Originally Posted by Unregistered

Everyone looks rich in this forum

So much passive income flowing in

Singapore has no Poor people