How much savings do you have?

LOL. Want to write story, must write with some credibility lah. Even before TDSR were implemented, banks would not lend you money to buy 2 properties (not to mention 5) if your salary was just $180k pa.

But more importantly do not feel inferior to others who seem to be wealthier and more successful. At the end of the day, no matter how many millions, properties and gold bars we have, we all have only ONE life. Live that life well and responsibly and that is enough.

We have owned 5 properties but not all at the same time. We currently have 2 - we lived in one and use the other to earn rental. Together with our other investments, our passive income is $150k a year. As we still work, we can save $350k to $400k a year.

Is my story credible?

Originally Posted by Unregistered

43 years old wife 42 not working
income only 180k per annum

1 fully paid shophouse
valued current residence 2.9 mil (800k loan left)
valued 900k condo (345k loan left)
valued 780k condo (350k loan left)
valued 850k condo (400k loan left)

if you wondered how i countered TDSR , bought all b4 it was introduced...

Originally Posted by Unregistered

LOL. Want to write story, must write with some credibility lah. Even before TDSR were implemented, banks would not lend you money to buy 2 properties (not to mention 5) if your salary was just $180k pa.

But more importantly do not feel inferior to others who seem to be wealthier and more successful. At the end of the day, no matter how many millions, properties and gold bars we have, we all have only ONE life. Live that life well and responsibly and that is enough.

We have owned 5 properties but not all at the same time. We currently have 2 - we lived in one and use the other to earn rental. Together with our other investments, our passive income is $150k a year. As we still work, we can save $350k to $400k a year.

Is my story credible?

Did you know my previous salary? Im not saying its high but it was around 300k +- depending on bonus... i switched job only recently as was made redundant

Originally Posted by Unregistered

Did you know my previous salary? Im not saying its high but it was around 300k +- depending on bonus... i switched job only recently as was made redundant

What industry were you in?

Originally Posted by Unregistered

What industry were you in?

Investment banker at Tiong bank

Hi,

I am 34 years old, female with one child.

Fixed deposit: 180k
Endowments that I brought under education and retirement ( with guaranteed amount) not projected: 210k
Property: One 4 room HDB. (Not staying here and rented one room out)

I have targetted monthly savings so to build up retirement fund. Hopefully I can reach my savings target of 300k in two years time.

[BusinessSingapore]

Originally Posted by Unregistered

Hi,

I am 34 years old, female with one child.

Fixed deposit: 180k
Endowments that I brought under education and retirement ( with guaranteed amount) not projected: 210k
Property: One 4 room HDB. (Not staying here and rented one room out)

I have targetted monthly savings so to build up retirement fund. Hopefully I can reach my savings target of 300k in two years time.

I am always curious as to why young people (34) like yourself channel the majority of their savings into FD where a higher yield could be easily attained in bonds or even bond funds. Given that you don't seem to need the full 180k of liquidity.

Genuinely wants to understand your perspective, thanks!

Originally Posted by BusinessSingapore

I am always curious as to why young people (34) like yourself channel the majority of their savings into FD where a higher yield could be easily attained in bonds or even bond funds. Given that you don't seem to need the full 180k of liquidity.

Genuinely wants to understand your perspective, thanks!

Bonds are not without risks especially the non rated ones which tended to be those giving higher yields. It was just last year? that a few bonds (those related to O&G) went belly-up and investors lost their capital.

Given the current relatively high stock market valuations, it is ok to sit tight on cash position. Holding cash is also a strategy in the overall investment scheme of things.

If she is secure in her employment, then yes, I would agree for her to take a little risk and invest for potentially higher returns.

I have gone through this phase before where I have set a savings target to meet. The surest way (not necessary the quickest nor the most efficient) to meet the target was through pure savings and keeping the savings in an FD.

But once my capital has grown bigger, it gets easier to take on more risk. And thats when I started investing in stocks and eventually progressing to property investment. It's about comfort level and margin of safety.

There is no right or wrong.

Hi, thank you for This. You have nailed on all of it and this is exactly how I feel. I read about bonds and investments and At this stage I am not willingly to take up too much risk due to market conditions and unless I have a good nest to start with, taking account that my child is still young. Bonds are not as safe as fixed deposits and I just want to build up my target savings before I start investing or looking for other tools to earn more interest. I feel that it is better to have a better cash position than to quickly jump into bonds or stocks at this time. =)

Originally Posted by Unregistered

Bonds are not without risks especially the non rated ones which tended to be those giving higher yields. It was just last year? that a few bonds (those related to O&G) went belly-up and investors lost their capital.

Given the current relatively high stock market valuations, it is ok to sit tight on cash position. Holding cash is also a strategy in the overall investment scheme of things.

If she is secure in her employment, then yes, I would agree for her to take a little risk and invest for potentially higher returns.

I have gone through this phase before where I have set a savings target to meet. The surest way (not necessary the quickest nor the most efficient) to meet the target was through pure savings and keeping the savings in an FD.

But once my capital has grown bigger, it gets easier to take on more risk. And thats when I started investing in stocks and eventually progressing to property investment. It's about comfort level and margin of safety.

There is no right or wrong.

[BusinessSingapore]

Originally Posted by Unregistered

Bonds are not without risks especially the non rated ones which tended to be those giving higher yields. It was just last year? that a few bonds (those related to O&G) went belly-up and investors lost their capital.

Given the current relatively high stock market valuations, it is ok to sit tight on cash position. Holding cash is also a strategy in the overall investment scheme of things.

If she is secure in her employment, then yes, I would agree for her to take a little risk and invest for potentially higher returns.

I have gone through this phase before where I have set a savings target to meet. The surest way (not necessary the quickest nor the most efficient) to meet the target was through pure savings and keeping the savings in an FD.

But once my capital has grown bigger, it gets easier to take on more risk. And thats when I started investing in stocks and eventually progressing to property investment. It's about comfort level and margin of safety.

There is no right or wrong.

Thanks for the reply.

However I have to disagree on most if not all points.

Bonds come in "shapes and sizes" from sovereign to corporate issuers; from AAA rated to unrated. To put it simply, there are safe ones and there are speculative ones. The one that you mentioned happened to be the ones with a high level of risk, issued by an industry that is undergoing a lot of challenges now. Swiber ISIN SG55E0991457 bonds are High Yield unrated Bonds that pays 7.15% coupons, that itself should already hold enough information to tell investors this is a riskier bond, from the name itself high yield, unrated and high coupon. So no, its not a fair comparison for a low risk appetite investor.

However, if you look at bonds that are more in context say an AAA rated bonds by Temasek Holdings SGD issued bonds ISIN SG7W86960343, you are looking at a 4.2% coupon (interest) which is a good 2X to 3X higher than a FD. And if you are concern about liquidity and ticket size since bonds tix size is usually 250K and up then go into a SGD bond fund that buys into local bank bonds (OCBC UOB DBS), Temasek Bonds and SG Gov Bonds. If you pick a top 10% peer group rating SGD bond fund you will be yielding 3%+ Net of management fees averagely.

My position is simple, picking the most efficient returns on the same level of risk. To me, the risk of FD is the bank's chance of default and whether or not the bank defaults depends on the SG Gov (local banks). So ultimately I am placing a bet on SG Gov, and if I can put my money into Temasek, DBS SG Gov Bonds that gives me more returns, why should I want to put it into FD when the underlying risks are the same?

That said, I fully understand (after reading the replies by both of you) your positions and I have to conclude it is seeking emotional safety(very impt btw) but it isn't factual.

I am not willingly to take up too much risk due to market conditions

You gotta be joking man, all major index across the world has returned positively over the past 12 months and I mean all, literally. Time to open your eyes and make a killing now.

Originally Posted by BusinessSingapore

I am always curious as to why young people (34) like yourself channel the majority of their savings into FD where a higher yield could be easily attained in bonds or even bond funds. Given that you don't seem to need the full 180k of liquidity.

Genuinely wants to understand your perspective, thanks!

Whats wrong with that? You a funds promoter? If yes, can you recommend what to buy, how to buy and ehere to buy? Btw, i am not the 34 yrs old female.