Whats your net worth

Originally Posted by Unregistered

Contributing 12.75k to SRS saves me about ~$900 in taxes yearly. That's why I am doing it.

Without SRS: $3407
With 12.75k SRS contribution: $2492

I intend to keep the money there till I am 62 then withdraw them over 10 years. SRS+CPF will be my retirement fund.

The 3.4k I save monthly will be eventually used for investments/buying house.

Right now I am ploughing 100% into nikko am sti etf via OCBC BCIP.

I previously tried to do my own stock picking but I found it too time consuming and too high-risk. I was making money on some bets and losing money on others.

After doing reading, I have come to the conclusion that index funds are the best way to go.

I have not liquidated my unit trust because they are giving me good monthly dividends.

In 2015, I will probably shift my monthly savings plan to:
50% nikko AM STI ETF
50% SPDR S&P 500 ETF (non-BCIP)

55k in bank account
12k in medisave account
10k in SA
3k in OA

House loan - $300k
no car

what I do for investment?

You want guaranteed 5% returns and guaranteed principal?

If so, you may want to put more money into your SA account. The first $40k in your SA will earn you 5% pa guaranteed with capital protection by the gahmen. Better than stocks and property investment.

I topped up my SA over 10 years ago to the then minimum sum of $92k, and since then the amount has always exceeded the minimum sum required. For eg, I now have $200k in my SA while the minimum sum is $161k (starting Jul 2015)

Originally Posted by Unregistered

55k in bank account
12k in medisave account
10k in SA
3k in OA

House loan - $300k
no car

what I do for investment?

Originally Posted by Unregistered

You want guaranteed 5% returns and guaranteed principal?

If so, you may want to put more money into your SA account. The first $40k in your SA will earn you 5% pa guaranteed with capital protection by the gahmen. Better than stocks and property investment.

I topped up my SA over 10 years ago to the then minimum sum of $92k, and since then the amount has always exceeded the minimum sum required. For eg, I now have $200k in my SA while the minimum sum is $161k (starting Jul 2015)

I wouldn't recommend putting money into the SA account. The money can't be withdrawn if he/she requires money due to unforeseen circumstances.

Since the person has $55k cash in bank, I would recommend him/her to put in a savings account that will give high interest. Check SCB.

[lazyplane]

Yes, i am aware of the tax savings and in your case 900 per year.
But dont you feel that you have to pay more next time ?

My simple maths
12.75 *35 yr = 450k+30 k(your base now) = 480k.

Since contribution is yearly, i will assume average sum of 200k for 35 years.
Assume you invest, and get 5% returns for this tenor/average sum you will get 10k pa.

So total sum at retirement of 65 ~ 480k+350k is around 830k
half of it will not be treated as taxable so 415k will be taxable and amortized over 10 years ie 40k withdrawn will be taxable each year.

If you generate any returns better than 5% , you may end up paying more which i feel is like a capital gain tax.

Having said that, i am an SRS account holder and have been contributing regularly but i am much older than you and my SRS is unlikely to grow into such a big sum in 10~15 years.

Originally Posted by Unregistered

Contributing 12.75k to SRS saves me about ~$900 in taxes yearly. That's why I am doing it.

Without SRS: $3407
With 12.75k SRS contribution: $2492

I intend to keep the money there till I am 62 then withdraw them over 10 years. SRS+CPF will be my retirement fund.

The 3.4k I save monthly will be eventually used for investments/buying house.

Right now I am ploughing 100% into nikko am sti etf via OCBC BCIP.

I previously tried to do my own stock picking but I found it too time consuming and too high-risk. I was making money on some bets and losing money on others.

After doing reading, I have come to the conclusion that index funds are the best way to go.

I have not liquidated my unit trust because they are giving me good monthly dividends.

In 2015, I will probably shift my monthly savings plan to:
50% nikko AM STI ETF
50% SPDR S&P 500 ETF (non-BCIP)

Currently Unemployed with $100k passive income from stocks. No cash savings. How I doing?

Originally Posted by Unregistered

Currently Unemployed with $100k passive income from stocks. No cash savings. How I doing?

What's your profile?

To the majority, you would be considered doing very well. Achieving a passive income of $100k pa is no mean feat. If you are in your 40s, this achievement is even more remarkable, but I suspect you are above 50?

I am now changing my focus on cash flow rather net worth, as I near retirement. Because once retired, there will be no more salary income and the only income will be from passive income sources. This is what will sustain my retirement lifestyle not net worth.

I used to target to achieve $6m before I would retire, but my property values have been artificially suppressed by the gahmen through the various cooling measures, putting me further away from my target net worth.

Before cooling measures:
Property 1 (our home) - $1.7m
Property 2 (rented out) - $1.35m

After cooling measures:
Property 1 (our home) - $1.6m
Property 2 (rented out) - $1.2m

Instead of chasing the $6m target which is looking like not possible given my age, I now aim to achieve a passive income cash flow of $150k pa which will comfortably sustain my envisaged lifestyle in retirement.

Currently my passive income is like yours, about $100k pa. I will need to re-strategise how best to redeploy my assets optimally to achieve the $150k passive income. One possible way is to rent out my current bigger home and stay in my smaller second property. This increase my passive income by another $10k - 15k pa. Another way is to redeploy my funds in safe instruments like FDs and Endownment to stocks for the higher dividends. But the risks will be higher as I already have $1m in stocks!

But at the end of the day, when retired, having a sustainable cash flow is more important than having high net worth. That's why people always complain they are asset rich but cash poor.

Originally Posted by Unregistered

Currently Unemployed with $100k passive income from stocks. No cash savings. How I doing?

Originally Posted by Unregistered

Currently Unemployed with $100k passive income from stocks. No cash savings. How I doing?

hmm from a language point of view, not very good....

From a lying point of view...excellent.....

all you need now is a ladder and rope and ur set for 2015......

Not sure how old you are. My wife and I are both 55 and we are retired. Our only child married an investment banker and living with him in a condo in D11. Both of us are now living in a two bedroom condo located next to an MRT station near the Jurong Lake area. We sold our penthouse and moved to the smaller and cosy condo. It freed up cash and allowed us to invest in dividend stocks.

Our passive income is now $80k pa and our daughter gives us $12k pa. Our expenses is only $50k pa, including holidays. Since we live next to the MRT, we no longer need a car to move around. Our place is also near to malls, hawker centres and supermarkets. We enjoy eating out and doing the household chores together. We also enjoy walking around the Jurong Lake in the evenings. Retirement is fun.

Originally Posted by Unregistered

To the majority, you would be considered doing very well. Achieving a passive income of $100k pa is no mean feat. If you are in your 40s, this achievement is even more remarkable, but I suspect you are above 50?

I am now changing my focus on cash flow rather net worth, as I near retirement. Because once retired, there will be no more salary income and the only income will be from passive income sources. This is what will sustain my retirement lifestyle not net worth.

I used to target to achieve $6m before I would retire, but my property values have been artificially suppressed by the gahmen through the various cooling measures, putting me further away from my target net worth.

Before cooling measures:
Property 1 (our home) - $1.7m
Property 2 (rented out) - $1.35m

After cooling measures:
Property 1 (our home) - $1.6m
Property 2 (rented out) - $1.2m

Instead of chasing the $6m target which is looking like not possible given my age, I now aim to achieve a passive income cash flow of $150k pa which will comfortably sustain my envisaged lifestyle in retirement.

Currently my passive income is like yours, about $100k pa. I will need to re-strategise how best to redeploy my assets optimally to achieve the $150k passive income. One possible way is to rent out my current bigger home and stay in my smaller second property. This increase my passive income by another $10k - 15k pa. Another way is to redeploy my funds in safe instruments like FDs and Endownment to stocks for the higher dividends. But the risks will be higher as I already have $1m in stocks!

But at the end of the day, when retired, having a sustainable cash flow is more important than having high net worth. That's why people always complain they are asset rich but cash poor.

I am happy for both of you that you are enjoying your retirement at 55. It is a good time to enjoy the fruits of your labour.

Yes, I am aware that we could live reasonably well with $100k pa in retirement. We still got a few years to 55, and our current living expense is around $120k - $140k pa as we have 2 cars and still paying off the mortgage of our second property and children still in the uni. Our 2 properties are next to MRT stations also.

The $150k pa passive income target we set ourselves include some buffer to take account of inflation over the longer term. Our envisaged lifestyle in retirement:-

1. Age in place (ie we hope to continue staying where we are as we are very comfortable with the neighbourhood)
2. Have a car to move around in comfort
3. Continue to travel at least once a year
4. Attend concerts and live performances
5. Dining out occasionally
6. Continue to engage in our respective hobbies (eg tennis, golf and investing)
7. Able to contribute to charitable causes

We foresee this phase to last a good 10-15 years (from 55 - 70 yo) before we tone down the more physical activities such as tennis, golf and traveling. By that time, our expenses will reduce but medical expenses could increase.

Originally Posted by Unregistered

Not sure how old you are. My wife and I are both 55 and we are retired. Our only child married an investment banker and living with him in a condo in D11. Both of us are now living in a two bedroom condo located next to an MRT station near the Jurong Lake area. We sold our penthouse and moved to the smaller and cosy condo. It freed up cash and allowed us to invest in dividend stocks.

Our passive income is now $80k pa and our daughter gives us $12k pa. Our expenses is only $50k pa, including holidays. Since we live next to the MRT, we no longer need a car to move around. Our place is also near to malls, hawker centres and supermarkets. We enjoy eating out and doing the household chores together. We also enjoy walking around the Jurong Lake in the evenings. Retirement is fun.