Retirement plans

[boredboiboi]

sorry TS to hijack thread...

currently I have some stocks and STI ETF. My target is for passive income to cover expenses, should I still consider those monthly saving plans for compound interest purposes or just focus on averaging out my stocks every few months?

What monthly saving plans do u mean?

 

[FreshFunds]

What monthly saving plans do u mean?

Like those u put in a fixed amount (500/mth for eg) for like 10 years and then let the lump sum amount earn compound interest from year 10 onwards for the next 20 or 30 yrs (depending on retirement age/when you want to withdraw). Those plans with guaranteed capital, purely for compound interest.

 

[BBCWatcher]

My target is for passive income to cover expenses....

I don’t understand this part either. That target might make some sense when you’re in retirement. Is there any more meaning? For example, is your target to ratchet up your lifestyle substantially and use income from investments to subsidize a much more expensive lifestyle instead of reinvesting?

 

[Aaron_soh80]

Any good plans to share? Not the high risk investment type ones but more for guaranteed returns like endowment. Any comments on Prudential, Great Eastern and Manulife?

Aiya just pump all ur CPF from OA to special account earn 4% pa..pay ur HDB by cash..sure hit 500k when u rch retirement...no troll hor..i do that now...when u sell ur flat dun nd pay back interest to gov...can save alot of money..trust me..

 

[FreshFunds]

I don’t understand this part either. That target might make some sense when you’re in retirement. Do you mean any more than that?

I’m a dividend investor so i’m targeting my passive income from my stocks to cover my future expenses during retirement, but thinking whether i should also look at those savings/investment plans that does compound interest.

 

[BBCWatcher]

I’m a dividend investor....

Why? You hate capital gains?

 

[FreshFunds]

Why? You hate capital gains?

I don’t hate it lol just not focusing on it for now. Of course it will be good when you can do both but I will need much much more time on research to pick growth stocks. But currently my investment objective is passive income, will buy and hold for long term.

 

[BBCWatcher]

I don’t hate it lol just not focusing on it for now.

Well why not? Dividends and capital gains are both great, right?

Amazon hasn’t paid even one penny in dividends, ever.

Of course it will be good when you can do both but I will need much much more time on research to pick growth stocks.

Why does a so-called growth stock require more or less research than a so-called dividend stock? There’s nothing guaranteed about either dividends or capital gains.

As it happens, companies in Singapore that distribute dividends pay tax on them pre-distribution. Capital gains, on the other hand, are generally tax free in Singapore.

 

[boredboiboi]

Like those u put in a fixed amount (500/mth for eg) for like 10 years and then let the lump sum amount earn compound interest from year 10 onwards for the next 20 or 30 yrs (depending on retirement age/when you want to withdraw). Those plans with guaranteed capital, purely for compound interest.

Why not? If you dont mind returns lower than investment. I believe that is also for risk diversification. Since its gonna guaranteed your capital and returns higher than FD.

 

[Sprinklesofrainbow]

DCA for investments or policies?

For investment policies

 

[Sprinklesofrainbow]

I don’t hate it lol just not focusing on it for now. Of course it will be good when you can do both but I will need much much more time on research to pick growth stocks. But currently my investment objective is passive income, will buy and hold for long term.

Yup if you get savings/ investments plans u don’t need to cherry pick stocks which saves your time and effort. Yet gives u eg. monthly dividend or bonuses as passive income

 

[nautilus]

For investment policies

Can you share the rationale of doing DCA for investment policies? I've commonly heard DCA for equities/bonds but this is the first time hearing DCA being advised for investments policies. It will be interesting to hear your POV.

 

[boredboiboi]

Can you share the rationale of doing DCA for investment policies? I've commonly heard DCA for equities/bonds but this is the first time hearing DCA being advised for investments policies. It will be interesting to hear your POV.

By nature, Investment plan is already Auto dca in a way, because u have to pay till payment terms end, be it 10 or 20 years. U have to pay the premium in month/quarterly/half yearly or yearly.

 

[nautilus]

By nature, Investment plan is already Auto dca in a way, because u have to pay till payment terms end, be it 10 or 20 years. U have to pay the premium in month/quarterly/half yearly or yearly.

Yup, precisely that's the way I understand it as well. If DCA for investment policies means signing up multiple policies at different points in time, I thought this would serve to just enrich the agent's pockets instead of truly DCA-ing if you do your own investments.

 

[Sprinklesofrainbow]

Can you share the rationale of doing DCA for investment policies? I've commonly heard DCA for equities/bonds but this is the first time hearing DCA being advised for investments policies. It will be interesting to hear your POV.

The investments policies carry equities/bonds components in it

 

[boredboiboi]

The investments policies carry equities/bonds components in it

The bonds and equities can be gotten without the policies.

 

[nautilus]

The investments policies carry equities/bonds components in it

What’s the difference then from doing your own DCA and cutting out the middleman? Correct me if I’m wrong but there are huge commissions to be paid to the insurer and agent with each sign up of a new policy. Wouldn’t it be more beneficial if the person can save on these substantial costs?

 

[Aaron_soh80]

Aiya just pump all ur CPF from OA to special account earn 4% pa..pay ur HDB by cash..sure hit 500k when u rch retirement...no troll hor..i do that now...when u sell ur flat dun nd pay back interest to gov...can save alot of money..trust me..

nobody agree this?

 

[nautilus]

nobody agree this?

Sure if you’ve a lot of cash. But if you’ve a lot of cash, it may also mean that you’re a high income earner and may be better off doing VC into SA under the CPF RSTU to save on income tax.

 

[Mr. Wood]

nobody agree this?

in theory can work, but how many ppl can really pay off HDB by cash?

i know some will say cut down spending, go less bubble tea, cut down starbucks, but in reality, not everybody drinks starbucks evyday. especially not the low ses workers.