Passive income
Rental = $30k
CPF interest = $24k

Negligible holdings in stocks and shares.
Couple 44 & 45.
NW about 2m

hi we are in same age group

couple 45 & 45

stocks $24k
CPF interest $24k

we are looking to buy a second house to start some rental income.

Quite typical of Singaporean couples in this age group to have around $2m in NW. When we were in our mid 40s 10 years ago, we had about $2.5m NW too.

So just to give you a glimpse of what your NW could grow to, in 10 years time (when you turn 55/56), our NW is currently at $6.5m. It grew roughly $1m+ every 3 years.

The important ingredients to the growth trajectory were:

1. Staying employed continuously (ie no break in income at any time)
2. Annual increase in salary. (Before age of 55, you should see your salaries growing each year. At 55, you may/may not hit your wage ceiling)
3. Invest for better returns (savings alone is a necessary step but not sufficient)
4. Grow your passive income to cover part or all of your expenses. Last year our passive income almost covers our expenses. This year we are expecting our passive income to totally cover our annual expense of $150k. And we are not even talking about the potential capital gain in our investment.
5. Dont lose money. Paper losses are ok during stock market decline, so long as you dont turn them into real losses. Stocks go in cycles. If the companies are fundamentally strong, their prices will rebound.
6. Related to the above point, buy stocks when markets are in decline. I maintain a war chest of $200k for such opportunities.
7. Likewise for property investment. We bought our investment property during market weakness.
8. Be patient. Borrow a quote from Warren Buffet:"The stock market takes money from the impatient and rewards the patient"
9. Another quote, from Robert Kiyosaki: "The 'poor' buy stuff, The 'middle income' buy liabilities and the wealthy buy assets."
10. Thus be frugal - dont buy stuff (eg high end hand bags, watches, handphones), and dont buy liabilities - expensive cars, club memberships, etc, but instead invest your savings - buy assets. It is the same as making your savings work for you!

Am heading 50 soon. All i can say I wish the past can always predict the future... I think the 40s have to work harder than i did as SG market levers are more max out compared to then. We could do property (clear investing strategy) but now, i am not so sure. rental yields are poor, and prices are not too realistic. Rental yields r better overseas but the risk is also higher. (ie fx risk, regulation risk etc)

36yo now with passive income of 80k+ p.a. from rental, interest, dividend. Hoping to retire once I hit the 200k mark.

One thing i have learnt about income and networth.. While it is easy to say how much xxx income is being derived from xxx assets , it is not easy to see the leverage that the person has taken to derive that income .

Part of analysing this equation can be applied to companies and especially REITS.. and the risk/reward may not be so rosy after factoring the leverage effect that has been taken.

What is the problem with leverage ?

Well, nothing .... if you based on nearly 10 years of QE easing ... In fact , it has been a ultimate tool to growth wealth over profitable and even marginally profitable assets . Hence back to me talking to myself that the past cannot predict the future.

But with the Fed hike starting and with further hike looming in the horizon... we may see a new change...

I dont think we will see growth like we used to in the next 10 years. Bets on STI index strategies , rental etc will no longer always be winners. It is going to be all hard work now to identify gems in the rubble. If you cant put the time in for the hardwork, then u will be better off with CPF investing.

at 55/56, your NW of $6.5m is nothing much. If you are an investment banker couple, your bungalow alone is worth $20m.

i dun recommend retiring with just 200k passive income unless ur content with typical pme middle class lifestyle. ur a bit behind the curve, time to buck up!

I agree. You have to work harder and longer until you're 75 years old.

You should aim to retire only after your net worth reaches $30m and your passive income is at least $1m pa.

BS advise. Should aim for billionaire status if wanna work till 75.