How much is enough for retirement in Singapore?

[kiwi bird]

hmmm… I guess if we can have regular passive income of S$10,000 a month and assets worth $3 million… my wife and I can retire…

[lee_yl]

fluffyboy:

I am currently holding 300k cash entirely in fix deposit. I am unemployed currently and relies on the fix depost interest income for my daily living expenses. Any advice how to make my money work harder yet at the same time low/zero risks? Reason being these are my entire life savings and I cant afford to lose the capital.

$300K can buy a 3rm flat and rent it out for regular income? You can get $1500-$1800 a month depending on location.

[lee_yl]

fluffyboy:

Can't...already have an existing hdb which i am currently staying in.

If possible, rent out 1 bedroom for extra income? $600-$800 extra per month depending on location until you find a job.

Or find some tutoring jobs to increase your income while you look for a full-time job? Do you have a car? Why not sign up as Uber driver for the time being?

I dare not advise you to invest your $300K as you are looking for investments at almost zero risk. At most, perhaps, take out $100K+ to upgrade your flat which gives you an extra bedroom which you can then rent it out. Rent out 2 bedrooms gives you an additional $1200-$1500 every month. Better than the approx $400 interest you earn from FD every month.

[kyith]

fluffyboy:

kyith:

Stocks and a mixture of cash in short term accounts, and preference shares, bonds if they are attractive.

Its owning listed businesses which are cash flow generative, and what I am able to understand at acceptable valuations.

I am currently holding 300k cash entirely in fix deposit. I am unemployed currently and relies on the fix depost interest income for my daily living expenses. Any advice how to make my money work harder yet at the same time low/zero risks? Reason being these are my entire life savings and I cant afford to lose the capital.

Hi FluffyBoy, sorry to hear that.

I think if you are willing to share more information, the forumers may be able to advice better.

You stated that you are unemployed but could you tell us what were you train in, whether you are married or single.

Also how much is your basic survival expenses.

If you want low to zero risks, then i am afraid i don't have much solutions.

Property - buy at the wrong value, it http://www.investmentmoats.com/stock-market-commentary/value-investing/property-investing/

Bonds - comes in different grade some higher quality more senior which are less likely to default, but those that yield higher always run the potential to default

Low Cost Exchange Traded Funds that follows the STI Index - technically a good tool to build wealth as it mirrors the straits times index, and gives a current 4% dividend yield if i am not wrong, but over the short term there is volatility. this year its down 15%. so if u dump 300k in its value will deduct 45k.

Stocks - same as low cost exchange traded funds that follows the STI index but subject to business risk and governance risk.

in short there are not many stuff that have zero to low risk.

depending on your age, there may be Insurance Endowments that distributes yearly cash flow after you put in a single lump sum premium for 5 years. One example is Premier Life from OCBC > http://www.ocbc.com/personal-banking/pr ... emier-plg/

This legacy planning policy works by you putting in a lump sum of e.g. 350k and then 5 years later they pay out 1k/mth. note that the 1k/mth is not guaranteed and subject to their investment returns.

i think there is an entry age, and do note! I am not saying this is no risk or low risk, i am just providing perspective

at the end of the day, there is no free lunch.

LEE_YL provides a good idea but you got to tell us more as in where you are staying currently.

If you are in a hard place, you got to make some tough choices. one of my reader in the past share with me an account of http://www.investmentmoats.com/budgeting/how-a-couple-rented-out-all-3-rooms-of-their-hdb-stay-in-it-and-borrow-to-pay-the-downpayment/.

tough times u need to think out of the box.

[starlight1968sg]

Interest obtained from FD 300k may not be sufficient to fund basic monthly expenses.

[starlight1968sg]

http://i67.tinypic.com/2w59gtz.png\">

Thanks Kyith for the above.

[kyith]

thanks starlight for posting this.


the idea of this stages of wealth is firstly, to satisfy our yearning to measure where we are, or where our friends are in a prudent manner.

secondly it is to pace our wealth progression.

notice there isn’t a retirement in this meter. I don’t think retirement is the right way to look at things, if you research up the history why there is retirement in the first place.

it is usually replaced with financial independence or freedom

[starlight1968sg]

kyith:

thanks starlight for posting this.


the idea of this stages of wealth is firstly, to satisfy our yearning to measure where we are, or where our friends are in a prudent manner.

secondly it is to pace our wealth progression.

notice there isn't a retirement in this meter. I don't think retirement is the right way to look at things, if you research up the history why there is retirement in the first place.

it is usually replaced with financial independence or freedom

the diagram is easy to understand. Most impt, it allows us to see where we stand now ie how far we are from the goal.
Thank you.

[ryuunix]

fluffyboy:

I am currently holding 300k cash entirely in fix deposit. I am unemployed currently and relies on the fix depost interest income for my daily living expenses. Any advice how to make my money work harder yet at the same time low/zero risks? Reason being these are my entire life savings and I cant afford to lose the capital.

Its true that fix deposit might not be enough. If your profile is so conservative, you might need to get a work to supply your expenses. Stagger your $300k into different parts to different instruments: OCBC has a 2.33% (help someone to pay payment of $500 per month and the person pay you back. but this promo is going to end soon), F.D (1 to 2%) , Bonds (2 to 4%), some banks have structured deposits (1 to 3%), Dividend paying funds (3.5 to 5%) that don't burn on Net Asset Value, etc. If you are close to retirement age, perhaps you might wanna know in CPF (2.5% is higher than your F.D).

Haha you might wanna lend out your money to those that you can trust for interest (that's what one of my friends does). Otherwise you are quite limited and restricted due to your risk profile and no net income coming in. =X

Try getting tangible assets if you can too, that generates passive income (like sharing private housing, commercial or private rental spaces)

[starlight1968sg]

An informative site related to retirement planning by NTUC Income:

http://www.retiring.com.sg/start-retiring.html