Whats your net worth

Only an idiot don't know how to retire with $3m.

Many uncles and aunties at the coffee shop are already retired with just a few thousand dollars in their bank. How do they survive? They rent out their spare rooms to FTs and get some allowances from their children. Also some amount from their cash and CPF savings.

Originally Posted by Unregistered

Have you actually done a check / assessment with a financial advisor before? You are the only one who can decide if $4m is adequate or not, in 20 years time when you retire and some more the money is supposed to last another 25 years?

After you sell $4m property, you will need to buy $1m HDB? leaving you $3m. Would expect that even a 4rm flat could cost that much in 20 yrs time. With 3% inflation, $3m 20 years later is probably worth $1.5m (today's value). Can that last you another 25 yrs?

Best to work the sum through. Retirement Calculators - CNNMoney

[whizzard]

Originally Posted by GR45

Dear Whizzard,

Grateful you took time to reply this newbie. : )

Private banks sound great but I am sure they will find me too dumb and conservative. On the other hand I have had it with fresh faced 20-something RMs who have been lecturing me about the world economy, reciting from the same play book and in the end, there is always a "special" investment product created for people "just like me".

And seeing you started the topic "Calling it Quits!", what do you think can be done in semi-retirement with, say $10M or $20M and reasonable returns on your investments. One can only travel or scuba-dive/ski/golf so much. ; )

Private bankers manage a lot of different clients from a wide spectrum of society. Some of them are not that financially savvy though they are very good at what they do, hence their wealth e.g. doctors, lawyers, scientists, businessmen, etc. So, don't worry ..... they are in the best position to advise you on what you need to aim for in establishing a robust investment portfolio. They are usually in their late 30s or older. I like those in their forties, enough experience but still mentally curious and sharp enough about the markets without complacency setting in yet. The privilege/priority bankers on the other hand, are the ones I really distrust. These are the ones in their 20s whose sole objective is to sell you something, doesn't matter what, so long as those products are in compliance with regulatory guidelines in order for them to earn a commission off you. I would advise you to stay far away from them. Therefore, open up at least 2 private banking account with good quality institutions and compare what they advice you.

I have read a number of studies and research that supports the notion that timing the market does not result in a higher return, they advocate a buy-and-hold strategy. From my own limited experience, I have to disagree. The studies are conducted using data over a very long time frame, a time frame that outlives me, hence useless in my scheme of things. Once you invest at a high and the market drops, it takes a long, long time to claw back to breakeven state. Let me give you a simple example, if you have invested $1 mil and your portfolio subsequently drops 20%, you are left with $800k. Now, you will need the market to rise by 25% to breakeven. If in the subsequent year, say your portfolio drops by another 10%, now you are left with $720k. In order for you to reach your initial investment of $1 mil, your portfolio must appreciate by 38.8%! This is from my own experience and not a theoretical example (though the quantum and amount may be different). Timing is key ..... if you are not convinced, leave the cash in the bank even if inflation is eroding your value away. Better than to lose it to the markets. One other way is to dollar cost average i.e. instead of investing everything at one go, parcel it out into a series of smaller amounts over an extended period of time. Both methodologies have one thing in common, PATIENCE!

Another concept which I find has been under-emphasised is portfolio re-balancing, which your private banker will conduct with you on a regular basis. This means that he/she will advise you to take profit on those asset classes which have out-performed and buy the lower performing ones so that your entire portfolio will maintain roughly the same proportion of allocation between asset class which you started with (unless there are strong reasons to vary the asset allocation). E.g. you started out with 1/3 bonds, 1/3 equities and 1/3 commodities. Over the next 9 months, equities may have outperformed whilst your bonds and commodities remained flat. Your current portfolio value is now more than 1/3 in equities and less than 1/3 each in bonds and commodities. You may then need to sell some equities (taking profit is always good) and use the proceeds to invest in more bonds and more commodities in order to re-balance your portfolio to 1/3 in each of the asset class again.

With a net investable asset of $10-$20 mil and 5%-10% returns per annum should be more than adequate to support your lifestyle and unexpected medical/hospitalisation expenses assuming your needs are not exorbitant. If you are able to get this return investing on your own, then you are fine already. As a businessman, I am sure you will always have a stash of cash sitting in the bank at any point in time for liquidity reasons and to tie you over choppy times.

What to do when one is retired ..... that is a question I ask myself too! I know I want to instill an exercise regime that will keep my body sharp and healthy. I know I want to travel more to learn about the culture and history of some cities/countries. I might get engaged in some grassroot community work. You have to find hobbies that you enjoy to keep you occupied. I can ski at least twice a year, once in late Dec and once in mid-Feb (which I am already doing now). I can dive 3 times a year mostly from Apr to Sep (I can only afford to do this once a year). 1 cruise a year and 2 cultural/historical cum golf adventures a year and/or a Porsche driving adventure once a year (I now combine a historical trip with my ski trip once a year). Assuming I spread it out into one trip a month for an average trip duration of 1 week each, that's 8-9 months meaningfully occupied because before each trip, one has to plan, research and prepare. That takes up time too. And money!

Retirement can mean a simple and routine life to some but that's not what I am nor what I want. I am still very curious about the world around me. Hence, it is important for me to ensure that my portfolio can provide me with adequate resources to execute what I would like to do when I retire from working life. The children will all be in university by then ..... we will no longer be constrained by their schooling schedule. When I reach my 60s, my wants may change again but that's a long time away. In the meantime, it is important to continue exercising to keep my body healthy else no need to go anywhere.

Originally Posted by whizzard

Private bankers manage a lot of different clients from a wide spectrum of society. Some of them are not that financially savvy though they are very good at what they do, hence their wealth e.g. doctors, lawyers, scientists, businessmen, etc. So, don't worry ..... they are in the best position to advise you on what you need to aim for in establishing a robust investment portfolio. They are usually in their late 30s or older. I like those in their forties, enough experience but still mentally curious and sharp enough about the markets without complacency setting in yet. The privilege/priority bankers on the other hand, are the ones I really distrust. These are the ones in their 20s whose sole objective is to sell you something, doesn't matter what, so long as those products are in compliance with regulatory guidelines in order for them to earn a commission off you. I would advise you to stay far away from them. Therefore, open up at least 2 private banking account with good quality institutions and compare what they advice you.

I have read a number of studies and research that supports the notion that timing the market does not result in a higher return, they advocate a buy-and-hold strategy. From my own limited experience, I have to disagree. The studies are conducted using data over a very long time frame, a time frame that outlives me, hence useless in my scheme of things. Once you invest at a high and the market drops, it takes a long, long time to claw back to breakeven state. Let me give you a simple example, if you have invested $1 mil and your portfolio subsequently drops 20%, you are left with $800k. Now, you will need the market to rise by 25% to breakeven. If in the subsequent year, say your portfolio drops by another 10%, now you are left with $720k. In order for you to reach your initial investment of $1 mil, your portfolio must appreciate by 38.8%! This is from my own experience and not a theoretical example (though the quantum and amount may be different). Timing is key ..... if you are not convinced, leave the cash in the bank even if inflation is eroding your value away. Better than to lose it to the markets. One other way is to dollar cost average i.e. instead of investing everything at one go, parcel it out into a series of smaller amounts over an extended period of time. Both methodologies have one thing in common, PATIENCE!

Another concept which I find has been under-emphasised is portfolio re-balancing, which your private banker will conduct with you on a regular basis. This means that he/she will advise you to take profit on those asset classes which have out-performed and buy the lower performing ones so that your entire portfolio will maintain roughly the same proportion of allocation between asset class which you started with (unless there are strong reasons to vary the asset allocation). E.g. you started out with 1/3 bonds, 1/3 equities and 1/3 commodities. Over the next 9 months, equities may have outperformed whilst your bonds and commodities remained flat. Your current portfolio value is now more than 1/3 in equities and less than 1/3 each in bonds and commodities. You may then need to sell some equities (taking profit is always good) and use the proceeds to invest in more bonds and more commodities in order to re-balance your portfolio to 1/3 in each of the asset class again.

With a net investable asset of $10-$20 mil and 5%-10% returns per annum should be more than adequate to support your lifestyle and unexpected medical/hospitalisation expenses assuming your needs are not exorbitant. If you are able to get this return investing on your own, then you are fine already. As a businessman, I am sure you will always have a stash of cash sitting in the bank at any point in time for liquidity reasons and to tie you over choppy times.

What to do when one is retired ..... that is a question I ask myself too! I know I want to instill an exercise regime that will keep my body sharp and healthy. I know I want to travel more to learn about the culture and history of some cities/countries. I might get engaged in some grassroot community work. You have to find hobbies that you enjoy to keep you occupied. I can ski at least twice a year, once in late Dec and once in mid-Feb (which I am already doing now). I can dive 3 times a year mostly from Apr to Sep (I can only afford to do this once a year). 1 cruise a year and 2 cultural/historical cum golf adventures a year and/or a Porsche driving adventure once a year (I now combine a historical trip with my ski trip once a year). Assuming I spread it out into one trip a month for an average trip duration of 1 week each, that's 8-9 months meaningfully occupied because before each trip, one has to plan, research and prepare. That takes up time too. And money!

Retirement can mean a simple and routine life to some but that's not what I am nor what I want. I am still very curious about the world around me. Hence, it is important for me to ensure that my portfolio can provide me with adequate resources to execute what I would like to do when I retire from working life. The children will all be in university by then ..... we will no longer be constrained by their schooling schedule. When I reach my 60s, my wants may change again but that's a long time away. In the meantime, it is important to continue exercising to keep my body healthy else no need to go anywhere.

Dear Whizzard and Unregistered Guest @ <01-11-2013, 02:40 PM>,

Your pointers not all understood but greatly appreciated. I will take some time to explore these possibilities but at least now I realise I am not diversified at all, both geographically and also asset class wise. Private banks could be a start as my accountant is not offering much more than doing the usual reports and submissions.

Xie xie !

Originally Posted by GR45

Dear Whizzard and Unregistered Guest @ <01-11-2013, 02:40 PM>,

Your pointers not all understood but greatly appreciated. I will take some time to explore these possibilities but at least now I realise I am not diversified at all, both geographically and also asset class wise. Private banks could be a start as my accountant is not offering much more than doing the usual reports and submissions.

Xie xie !

Dear GR45, could you share a little on how you attain the astronomical $3m/year income?

I am a poor guy who earns only $40k pa. At an age of 47, this is pathetic. But what to do, just be happy. Luckily my parents left me a condo where I am staying in. I am the poorest condo dweller in my neighbourhood I think. Due to the condo, my net worth is $2m.

You are doing just fine. At least you live in a condo and you are a millionaire even though you don't earn much. Your condo will double in value by the time you are 65. You can then sell it for $4m and then downgrade to a 2 room HDB flat.

I'm 50 and I only get $30k pa from my trading. Got tired of working for other people and being under appreciated. I'm happy doing my trading from my 3 room HDB flat. My wife works too and earn $50k pa. We are contented with our annual combined income of $80k and we only spend $45k pa. I manage to pay off our flat's mortgage and we don't have any debt. We are simple heartlander folks. Our savings now is about $400k. I hope to sell my 3 room flat for $700k when I reach 65. We will then retire in Thailand, we will be rich millionaire tycoons down there.

Originally Posted by Unregistered

I am a poor guy who earns only $40k pa. At an age of 47, this is pathetic. But what to do, just be happy. Luckily my parents left me a condo where I am staying in. I am the poorest condo dweller in my neighbourhood I think. Due to the condo, my net worth is $2m.

I got my BTO flat with my wife when I was 35. She was 28. We have paid off our mortgage loan last year when I was 45. Now the flat is valued at $500k. Our total net worth, including the flat, is $700k. We earn $120k pa. in total. We save $30k pa. No debt. Are we doing ok?

Originally Posted by Unregistered

You are doing just fine. At least you live in a condo and you are a millionaire even though you don't earn much. Your condo will double in value by the time you are 65. You can then sell it for $4m and then downgrade to a 2 room HDB flat.

I'm 50 and I only get $30k pa from my trading. Got tired of working for other people and being under appreciated. I'm happy doing my trading from my 3 room HDB flat. My wife works too and earn $50k pa. We are contented with our annual combined income of $80k and we only spend $45k pa. I manage to pay off our flat's mortgage and we don't have any debt. We are simple heartlander folks. Our savings now is about $400k. I hope to sell my 3 room flat for $700k when I reach 65. We will then retire in Thailand, we will be rich millionaire tycoons down there.

Good to see that we have the real Singaporeans here.

[Hermit]

Hi Whizzard, I started an thread long ago for Private Banking. If you have more to share, feel free to bring up the topic https://forums.salary.sg/investments-...ate-banks.html .

BTW, any experience in your research with Pictet and Julius Baer - how do they compare with the bigger boys ?

I used to live in a terrace house. Sold it for $2.5m and bought a $1.2m condo, fully paid. Plus my savings, I now have about $1.6m of an investment portfolio which gives me an annual dividend of $80k. While I have retired from my corporate job, my wife is still working, earning $90k pa. So we earn a total income of $170k pa, while we spend $130k pa. I am now a multi-millionaire debt-free retiree investor at the age of 48 and I aim to be a multi-millionaire with a net worth of $5m by the time I reach 65 and $10m at 85.