Passive income options

[CrimsonP]

Parent already got passive income and should retire and enjoy their retirement...the son and daughter should not dictate what the parents should do with their money...the son and daughter should think about their own retirement...if the son and daughter could not even save money to invest on his own, expect to invest/speculate with parents money?if son or daughter already investing, why bother about parents who already got 800k for retirement?

hey smart alex ,

i'm being instructed by parent to help them out

don't need you to lecture me.

 

[makav31i]

hey smart alex ,

i'm being instructed by parent to help them out

don't need you to lecture me.

Since you are so smart you don't need to ask people for help..

 

[CrimsonP]

Since you are so smart you don't need to ask people for help..

 

[Shiny Things]

hey smart alex ,

i'm being instructed by parent to help them out

don't need you to lecture me.

Firstly, dude, don't feed the trolls.

Secondly, your parents have done pretty well for themselves, so they don't want to screw it up now. It's great that they're savvy enough to stay away from murder-holes like FX deposits and investment-linked insurance policies.

I'm going to assume that they want a bit more return than fixed deposits, but they don't want to take too much risk.

Let's keep it simple for them. 60-40 bonds-stocks is appropriate at their age - they'll get a bit of capital growth from the stocks, and a bit of a yield pickup from the bonds.

If they like their fixed deposits - and why wouldn't they? - they can turn the risk even further down by moving to 30-30-40 cash-bonds-stocks.

Let's say they go for that - 30-30-40 cash-bonds-stocks.

They should start up a Standard Chartered or DBS cash-upfront brokerage account, to make sure they get the absolute cheapest brokerage possible. The difference between Standard Chartered and any other brokerage account - DBSV, UOBKH, Phillip, whatever - is going to be nearly six hundred dollars, so don't be suckered by fancy trading platforms or anything like that. They don't need any of that rubbish.

Step 1: Leave 30% - $240k - in fixed deposits. That's your cash stash, for near-term expenses.
Step 2: Invest 30% - $240k - in A35, the ABF SG Bond ETF. This'll give you some nice stable income - not a lot, because the yield's low, but it's a stable investment.
Step 3: Invest 40% - $320k - in ES3, the StreetTracks STI ETF. This tracks the Straits Times Index: it only invests in blue-chip stocks, no dodgy penny stock rubbish; it throws off a nice dividend yield, for some more income; and over time it'll keep growing so your parents will be able to fund their retirement for longer.
Step 4: Once a year, log into your brokerage account, and rebalance - sell and buy stocks and bonds and cash to get the proportions back to 30-30-40. This might sound odd - selling your winners? - but research shows that it adds about an extra 1% a year to your returns, for no more than an hour a year's effort.
Step 5: Go out and have a nice dinner at the Sands. You've earned it.

And that's really all you need to do. That should set them on the right path for retirement, and it'll make their cash last a lot longer than it would if it was all in fixed deposits.

 

[slurpy0099]

Thanks Shiny Things for sharing this!!! Very useful!

 

[Dividends Warrior]

btw.. how to make $ from cars??

Maybe a car rental business?

 

[Invest1000]

pick equities that pay high dividend yield

 

[wahkao3]

What is the best passive income?

 

[Yowzer]

What is the best passive income?

Rental income

 

[winterrealm]

hiiii
any suggestion on this little fund i have in bank approx 27k.
can take abit of risk but of cos this is all i have which i dont like it all down to drain.

 

[aireek]

Actually if you source around, there are some small funds (not banks) that cater to small investors. They can be pretty consistent in their returns ~15% pa.

 

[ramdick]

Actually if you source around, there are some small funds (not banks) that cater to small investors. They can be pretty consistent in their returns ~15% pa.

Can you or anyone give some examples ? TIA

 

[blurblur123]

In 2009, when the market was at its bottom, you can dump all your 20k into the stocks exchange and went back sleep nicely.

At this moment, the stocks are at its all time high. If you have 20K, how long will you get it into the stocks, if dollar cost averaging has to be utilized? I have this kind of question now.

Best Regards
David

Tt why now is important to build your warchest. Everyone is scared to buy stocks. Sometimes, doing nothing is a good strategy too. Build warchest first and wait for the chance to strike.

 

[Yowzer]

Just do your research and put your money where your faith is. Personally, I believe google will rule the world in future.

Hit my target entry price at the lower 800s & went in substantially. Was lucky it jumped above 1k a few days later.

 

[iCuteCube]

Hi bro,

Good day. Thank you very much for your ideas in how to invest in this case.
You mentioned the annual re-balancing, which is to reset back to the original allocation of different assets.
From the tutorial I learned from sias website, it is recommended to increase the bond allocation percent along with the increase of age.
I know in this case, the parents have enough income already. So there is no need to increase the bond allocation along aging.
For me, if I want to implement a full ETF portfolio, how do I re-balance annually to reflect the increase of age?

Thank you bro. I have leaned quite some from your post.

Best Regards
David

Isn't ETF consider diversification in terms of Stock?

Quoted " For me, if I want to implement a full ETF portfolio "

If you are just 100% on ETF, how is that a REAL diversification ? Therefore a diversification would be allocating your money into different asset classes like some precious metals, some bonds, or something else.

 

[wahkao3]

Just do your research and put your money where your faith is. Personally, I believe google will rule the world in future.

Hit my target entry price at the lower 800s & went in substantially. Was lucky it jumped above 1k a few days later.

how to research? pls teach

 

[Dividends Warrior]

In 2009, when the market was at its bottom, you can dump all your 20k into the stocks exchange and went back sleep nicely.

Not really true. You would be surprised how many people still lose money from 2009 to now.

Even in 2009, we still need to be selective. Right now, we need to be super super selective when choosing which counter to add.

 

[Dividends Warrior]

Personally, I believe google will rule the world in future.

Google is oredi ruling the world now.

 

[Yowzer]

how to research? pls teach

Just look around & see what the world needs. Not what you like or want you want only. How many times do you use google a day? Who is its nearest search competitor? None.

Android, google maps, information provider, and in future, driverless cars and some weather mapping thing and several cutting edge technologies which the world will depend on. Google seems to have a pie in everything mankind will need in the next 20 years.

In short, my research is really observation rather than textbook rules.

The other sector I'm trying to enter is financial & credit transactions which the world will become more reliant on. And IMO, almost peerless here is MasterCard.

To me, the best passive income is the right equity & rental income (in Singapore).

 

[wahkao3]

Just look around & see what the world needs. Not what you like or want you want only. How many times do you use google a day? Who is its nearest search competitor? None.

Android, google maps, information provider, and in future, driverless cars and some weather mapping thing and several cutting edge technologies which the world will depend on. Google seems to have a pie in everything mankind will need in the next 20 years.

yea, and its also super expensive. Look at its PE ratio. Its at 30.
meaning you need to pay 30 times its earnings to buy its share. What if after 10 years it lose its steam and stop becoming the the search leader? What if after 10 years another company invent new technology that surpass google?

How sia?

If its cheap like PE of 5 to 12, no problem, I straight away buy liao. But at a PE of 30, I have to think twice.