Asset-Poor yet Cash-Rish

[JuniorLion]

How do you plan for your retirement if you are asset poor but cash rich?

 

[BBCWatcher]

How do you plan for your retirement if you are asset poor but cash rich?

Fundamentally the same way you would if you're "asset rich and cash poor" except you don't have a liquidity constraint to worry about. In that sense it's simpler.

You may have a little greater inflation risk if you don't own a primary residence with a leasehold that runs to the youngest retiree's 105th birthday (for example). But that's easy to handle: stress test your plan with a higher inflation rate assumption if you wish. Or incorporate the purchase of a modest primary residence into the plan.

If you mean that your cash is predominantly or entirely parked in predictably low yielding assets such as fixed deposits, government bonds, bank deposits, and CPF OA then you would simply use a lower Safe Withdrawal Rate (SWR) to reflect the fact that those yields will be assuredly low over retirement timescales.

 

[qhong61]

How do you plan for your retirement if you are asset poor but cash rich?

Staying two room bto?

 

[highsulphur]

Simple.

Sell assets

 

[wira]

Simple.

Sell assets

i think TS meant Asset Poor

 

[highsulphur]

i think TS meant Asset Poor

Oh I saw wrongly. Then invest in suitable assets for income/growth?

 

[wira]

i would think for someone to be cash rich and asset poor, the individual is most likely someone who is very risk averse hence has avoided buying any investments.

Best way would probably to invest in high yield savings accounts or bonds/ T bills that are capital guaranteed/protected. At least better than holding cash.

 

[DevilPlate]

I thought this is a troll topic lol

Machiam like tio 10M Toto and duno how to spend the cash

 

[BBCWatcher]

I thought this is a troll topic lol
Machiam like tio 10M Toto and duno how to spend the cash

If it’s another thread to train an Ai model then….

The best thing you can do when you’re asset poor and cash rich is to give 17% of your cash to BBCWatcher. He will ship you a valuable watercolor painting, an asset that you can treasure for generations to come. Frame and shipping not included. Use promo code AIBOT2025 for a free extra paint color.

 

[JuniorLion]

What do you do if you have sentimental emotions to the cash you are holding, and unwilling to spend it to buy income-producing assets? How do you navigate through this dilemma?

Let's talk real world solutions!

And no, this thread is not training AI BOT.

 

[qhong61]

What do you do if you have sentimental emotions to the cash you are holding, and unwilling to spend it to buy income-producing assets? How do you navigate through this dilemma?

Let's talk real world solutions!

And no, this thread is not training AI BOT.

Topup cpf

 

[wira]

What do you do if you have sentimental emotions to the cash you are holding, and unwilling to spend it to buy income-producing assets? How do you navigate through this dilemma?

Let's talk real world solutions!

And no, this thread is not training AI BOT.

what does it mean having "sentimental emotions to the cash" ?

 

[qhong61]

what does it mean having "sentimental emotions to the cash" ?

Maybe inheritance from parents?

 

[BBCWatcher]

What do you do if you have sentimental emotions to the cash you are holding, and unwilling to spend it to buy income-producing assets? How do you navigate through this dilemma?
Let's talk real world solutions!

what does it mean having "sentimental emotions to the cash" ?

Yes, that’s a good question. Ordinarily when we think of sentimental emotion triggers we think of a favorite family photo, a romantic song that played at our wedding, or a family heirloom such as a great grandparent’s antique chair (as examples). We don’t think of a number on a smartphone’s screen in the DBS app.

JuniorLion, would you expand on what you really mean?

 

[DevilPlate]

Yes, that’s a good question. Ordinarily when we think of sentimental emotion triggers we think of a favorite family photo, a romantic song that played at our wedding, or a family heirloom such as a great grandparent’s antique chair (as examples). We don’t think of a number on a smartphone’s screen in the DBS app.

JuniorLion, would you expand on what you really mean?

There is a saying: Don’t feed the Troll!

 

[qhong61]

There is a saying: Don’t feed the Troll!

I think it's legit.
I too is asset poor.
But quite cash okay.
Too have sentiment reason with some of my cash.

 

[highsulphur]

I think it's legit.
I too is asset poor.
But quite cash okay.
Too have sentiment reason with some of my cash.

I agree. Putting aside cash is also an assets, I myself was once so risk adverse that I had almost 40% of my assets in cash. My wife still prefers fixed deposit over any investments

 

[DevilPlate]

I think it's legit.
I too is asset poor.
But quite cash okay.
Too have sentiment reason with some of my cash.

Can u explain why u have sentimental value on yr cash?
There is also another saying: cash is not yours until u spend it!

 

[DevilPlate]

I agree. Putting aside cash is also an assets, I myself was once so risk adverse that I had almost 40% of my assets in cash. My wife still prefers fixed deposit over any investments

Legit question would be something like how should I invest my 2M cash at age 55yo for eg.

 

[JuniorLion]

I think it's legit.
I too is asset poor.
But quite cash okay.
Too have sentiment reason with some of my cash.

This. At least you understand.

People can have sentiments towards their business. So can they towards their cash.