MBH/A35 alternatives

[reddevil0728]

I actually come to the conclusion that it might be better to treat CPF as the equities part of anybody's portfolio. Let the super uncompetitive interest rate from CPF OA drag on for another year or so, and we will know that politicians rather keep HDB home loan owners happy than all other CPF members. Keep equities in CPF, and let cash get access to a wider range of cash or bond like investments.

But to be fair CPFIS for equities is around 0.50% more expensive than what we can get from ETFs.

I don't care because I invest as much of my CPF in equities as possible, but these past few months is probably a rude shock to people who buy in to the rhetoric that CPF should be treated as a bond holding. I guess it is really bond like, given how stable the yields are holding. Lol.


I believe this insti share class would be a better option with lower fees.

https://endowus.com/investment-funds-list/pimco-gis-income-fund-IE00BSTL7535

Diff school of thought

 

[DevilPlate]

I am treating CPF SA as part of my bond allocation but not OA.

Upon 55yo, excess OA can be quite nice and acts as a savings acct/atm withdrawal.
But before 55yo, I believe most of us should be using OA for property purchase downpayment and mortgage repayment. So, should be close to zero lol.

 

[Listopad]

But to be fair CPFIS for equities is around 0.50% more expensive than what we can get from ETFs.

How did you derive 0.5%?

 

[reddevil0728]

I am treating CPF SA as part of my bond allocation but not OA.

Upon 55yo, excess OA can be quite nice and acts as a savings acct/atm withdrawal.
But before 55yo, I believe most of us should be using OA for property purchase downpayment and mortgage repayment. So, should be close to zero lol.

pre high interest rate times. might actually make better sense to pay with cash rather than CPF. so the latter might not be necessary true

 

[s0crates]

How did you derive 0.5%?

ISAC/VWRA/IWDA ~0.2% p.a.

Infinity global stock index + endowus fee ~ 0.7% p.a..

That gives a 0.5% difference.

Some will say better to use FSM/Dollardex for the infinity global fund, which is just slightly lower than 0.5% so fee difference is only 0.3%p.a.

Depends on what you use ultimately. I think the difference should be at 0.3% in the long run which is essentially endowus fees.

 

[Listopad]

ISAC/VWRA/IWDA ~0.2% p.a.

Infinity global stock index + endowus fee ~ 0.7% p.a..

That gives a 0.5% difference.

Some will say better to use FSM/Dollardex for the infinity global fund, which is just slightly lower than 0.5% so fee difference is only 0.3%p.a.

Depends on what you use ultimately. I think the difference should be at 0.3% in the long run which is essentially endowus fees.

https://secure.fundsupermart.com/fsm/funds/factsheet/LCP194/Infinity-Global-Stock-Index-C-SGD
expense ratio of 0.48% vs IWDA 0.2%. No platform fee on bond FSM. The extra charge is reasonable I feel .

 

[Ceschfab]

Beginning to slide again.... haiz

 

[reddevil0728]

Beginning to slide again.... haiz

You short term investor?

 

[BBCWatcher]

Beginning to slide again.... haiz

Great news if you’re a buyer.

 

[Ceschfab]

You short term investor?

not really.... just really bought at the wrong time (end 2021)

 

[Ceschfab]

Great news if you’re a buyer.

Compare this to a savings acct that offers ard 5%, which one will you take up if you have funds?

 

[reddevil0728]

not really.... just really bought at the wrong time (end 2021)

it depends on at which period you are looking at it. it changes over time.

 

[s0crates]

I gotta admit I find it amusing when long term investors says "It's a great time to buy when market is down".

If you are already fully invested, how else to find money to buy?

 

[reddevil0728]

I gotta admit I find it amusing when long term investing says "It's a great time to buy when market is down".

If you are already fully invested, how else to find money to buy?

from monthly new income

 

[s0crates]

from monthly new income

Does it even matter?

When just 0.X% of your networth can be invested monthly, and even less as you age?

Sounds like someone is keeping a warchest somewhere lol.

I hate it when market crash. I don't panic sell or lose sleep over it, but I don't kid myself with saying I can average down $2k when my $500k portfolio is down 20% lol.

Just say it as it is. It sucks when markets are down, but it should be something we are prepared for.

 

[reddevil0728]

Does it even matter?

Depends on individual mindset

When just 0.X% of your networth can be invested monthly, and even less as you age?

If you think that if the market is done and it will be down forever, then maybe one shouldn’t even be investing? If not how would age come into the picture so quickly

Sounds like someone is keeping a warchest somewhere lol.

I hate it when market crash. I don't panic sell or lose sleep over it, but I don't kid myself with saying I can average down $2k when my $500k portfolio is down 20% lol.

Just say it as it is. It sucks when markets are down, but it should be something we are prepared for.

Yep it sucks. But it’s factually true that you can continue to average down.

cause it can up in no time too

 

[BBCWatcher]

Compare this to a savings acct that offers ard 5%, which one will you take up if you have funds?

If the interest rate is a higher real interest rate then I think it has a slight impact on how you’d treat money with a medium term spending objective. But fundamentally I’d stick to short-term money in short-term vehicles and long-term money in long-term vehicles.

I gotta admit I find it amusing when long term investors says "It's a great time to buy when market is down".
If you are already fully invested, how else to find money to buy?

from monthly new income

And windfalls — a bonus from an employer, an inheritance, a legal settlement in your favor, etc.

 

[perrinrahl]

from monthly new income

Quite a bit harder though for those who are self-employed and receive their income/earnings in chunks.

 

[BBCWatcher]

Quite a bit harder though for those who are self-employed and receive their income/earnings in chunks.

Not much harder. Income is often somewhat lumpy, but think of it like managing a hydroelectric power plant with a dam and a reservoir. You‘re aiming for a steady (and growing, at least with inflation) series of decades of long-term investment buys. That means always maintaining water behind the dam within a reasonable range (an ordinary bank account typically). If it looks like the water behind the dam is piling up and could overflow the dam (you have the happy problem of too much cash accumulating) then bump up your monthly buys.

You have to do manage cashflows and cash reserves anyway for monthly mortgage payments, monthly mobile phone bills, monthly electric bills, monthly GIRO income tax payments, and so on. So just treat paying yourself (additions to your long-term assets) the same basic way. Pay your bill to yourself first. Unless there’s some dire and sustained emergency of course, but try to avoid those.

CPF does this. You don’t even see your compulsory contributions, at least employees don’t. They never land in your bank account. So be your own CPF Board in that sense.

Personally I wouldn’t immediately stop or reduce monthly long-term investments even with job loss. I’ve got some water behind the dam, and even job loss wouldn’t immediately reduce my electrical output (contributions to long-term investments). But that might be a bit too advanced, so just do the best you can. As you already do with other monthly bills.

 

[wilderness]

Hi all, new to investing here. Just wondering in the current high interest environment, is mbh still viable?