Retirement Planning

[BuiBuiZai]

Dear all,

Needed some advice/suggestion on how to go about having an earlier retirement together with wife 20 years from now. I registered a new account for this purpose to avoid exposing myself. Will try to provide as much info to allow you to form a better advice/suggestion. Below values all in SGD

Age: Me Sporean Wife SPR both in mid 30s, 2 Kids Sporean < 5
Annual Income: 230k combined
Asset: Coming 5 years 4br HDB (fully paid via cash with current market value of at least 300k i guess)
Cash: 320k combined thru hard savings (distributed across multiple bank account to maximine interest of about 2% p.a weighted avg)
CPF: Me 210k (OA) 83k (SA) 55k (MA), Wife 103k (OA) 37k (SA) 33k (MA)
SRS: Me 30k (top up twice to enjoy some tax benefits, funds not invested yet)
Insurance Edu plans for kids: 24k p.a for 5 years starting from 2018 mature in 17 years for 160k
Investment: None but intend to enter share maket if STI drop 50% with 50% of current cash and regular 10x interval 5% average down/up with balance cash on hand and continue to buy when monthly wage received
Debt: None
Car: None (takes public transport thou always wanted to buy a car since 18 years ago, with current low COE and govt announcing more COE for next 3 months, its really tempting to buy myself a Attrage)

Current plan is to sell HDB and buy 3br (maybe Whistler Gran of 1.5m+/- provided CDL accept reissue of option required due to HDB MOP) with myself 1% share and wife 99% share (this is to minimise ABSB in future if we intend to go for a 2nd pte property) in hope of some capital appreciation 10 to 20 years down the road and at the same time giving my family a better living environment. We do not mine staying in HDB at all and have been staying in HDB all along.

Some mentioned property investment should be kept at 20% of investment portfolio for diversification purpose and I'm wondering if i'm taking the wrong path in selling HDB and buying a pte condo.

I do felt that the property price is on the high side now but looking at the number of en bloc in the recent 2 years and many yet to receive their money, chances are it will continue to go up but at a slower pace. Furthermore, intention is for long term stay and not for flipping say in 3 years time therefore should be pretty safe? If proceed to buy pte condo, should we be using cash or cpf for the 1st 25% and subsequent monthly repayment?


Welcome all genuine comments so that i can take a better action moving forward. Feel free to ask anything in case i missed out some vital information above. Thanks

 

[Thoreldan]

go buy shiny things ebook and follow his strategy on local etf + global etf + bond components, rebalance every year.

Visit a pub when you're done.

 

[JuniorLion]

Whistler Grand is 99-years leasehold, so you might want to consider again. Or look at freehold if you like.

Also, if you have follow the news of URA limiting the number of shoebox units that can be built in any new developments, you should get an inkling that the Government is really limiting the upside of Singapore Property investment.. so think again.

Any leftover, you can consider investing into IWDA ETF.

 

[Geeezz]

u wn wait sti drop 50% then enter? like that u retire alrdy also still holding cash lor

 

[BuiBuiZai]

go buy shiny things ebook and follow his strategy on local etf + global etf + bond components, rebalance every year.

Visit a pub when you're done.

Where to buy?

 

[BuiBuiZai]

u wn wait sti drop 50% then enter?


like that u retire alrdy also still holding cash lor

Not really la. Cos me thinking when crisis come, will look into sti history and decide on appropriate % based on how bad tat crisis is comparing to past. 50% is just for illustration, it can be 40% or 30%, main msg is intend to enter during crisis with half of savings and then follow by averaging.

 

[BuiBuiZai]

Whistler Grand is 99-years leasehold, so you might want to consider again. Or look at freehold if you like.

Also, if you have follow the news of URA limiting the number of shoebox units that can be built in any new developments, you should get an inkling that the Government is really limiting the upside of Singapore Property investment.. so think again.

Any leftover, you can consider investing into IWDA ETF.

From info I gathered, LH actually performed better than FH in general over last 10 years. First mover advantage mentioned by property agents make sense to me too. There isn't many new launch in West area which I preferred.

 

[ELKYme]

TS is asking more about retirement planning rather than property investment. Believe he added he’s intention to purchase a property so that someone can advise if he can afford to buy the property with he’s current finances and income WITHOUT compromising on retirement.

Hopefully some pro-retirement planner can come in to share so that we all can learn coz retirement is on my mind too.

This thread is definitely more legit than the 5 million dollar thread.

 

[BuiBuiZai]

1 thing to add. My wealth accumulation happen mostly in the last 5 years. Did not go into stock market cause I'm quite risk adverse. As a chinese, always felt that a tangible property is safer bet and personally know more people who gain in property rather than in stock market. But must admit my sample size is too small to be conclusive thus starting this thread for guru to advice further. Thanks.

 

[BuiBuiZai]

TS is asking more about retirement planning rather than property investment. Believe he added he’s intention to purchase a property so that someone can advise if he can afford to buy the property with he’s current finances and income WITHOUT compromising on retirement.

Hopefully some pro-retirement planner can come in to share so that we all can learn coz retirement is on my mind too.

This thread is definitely more legit than the 5 million dollar thread.

Property purchase is not a must for me and I have done my sum and I do believe I can afford a pte condo. Whether putting so much funds into 1 investment vehicle is a wise choice is my concern. Pte condo is just part of retirement planning in hope of capital upside 10 to 20 years down the road. It should at least keep pace with inflation imo. This if true is already better than me putting money in bank of about 2% yield at the moment. If there r better way to achieve earlier retirement, I'm more than glad to have a plan change.

 

[Knight_Rider]

1 thing to add. My wealth accumulation happen mostly in the last 5 years. Did not go into stock market cause I'm quite risk adverse. As a chinese, always felt that a tangible property is safer bet and personally know more people who gain in property rather than in stock market. But must admit my sample size is too small to be conclusive thus starting this thread for guru to advice further. Thanks.

Posted from PCWX using CLT-L29

The expense is killing nowadays. Earn earn earn give taxman. So now I keep to low expense investment. I believe the end game is capital appreciation.

 

[stellamara]

Property purchase is not a must for me and I have done my sum and I do believe I can afford a pte condo. Whether putting so much funds into 1 investment vehicle is a wise choice is my concern. Pte condo is just part of retirement planning in hope of capital upside 10 to 20 years down the road. It should at least keep pace with inflation imo. This if true is already better than me putting money in bank of about 2% yield at the moment. If there r better way to achieve earlier retirement, I'm more than glad to have a plan change.

Posted from PCWX using CLT-L29

whistler grand seems like not bad a project since its by CDL.

i guess with your income it def doesnt hurt to buy a pte condo, u prob can pay finish in another 5 years so why worry so much?

Prob what you need to do now is prob buy enugh insurance cover all aspects and think about improving your quality of life thats for sure. life is short and it seems like you guys are saving way too hard.

 

[ELKYme]

Yes Bro,
That’s what I thought.

Retirement planning takes precedence over upgrading of property.

A good retirement plan MUST first be in place, consideration as to whether upgrading of property is affordable/prudent should only be done after. No point upgrading and having to sell the property because there isn’t enough to retire with.

The resident gurus here must be busy having a good time as it’s after all a Saturday.

Let’s wait till they reply.

Property purchase is not a must for me and I have done my sum and I do believe I can afford a pte condo. Whether putting so much funds into 1 investment vehicle is a wise choice is my concern. Pte condo is just part of retirement planning in hope of capital upside 10 to 20 years down the road. It should at least keep pace with inflation imo. This if true is already better than me putting money in bank of about 2% yield at the moment. If there r better way to achieve earlier retirement, I'm more than glad to have a plan change.

Posted from PCWX using CLT-L29

 

[BuiBuiZai]

I'm fine if to buy a pte condo now and downgrade back to hdb during retirement. This is if buying it now is a wise choice towards earlier retirement.

 

[ocs_woodlands]

I'm fine if to buy a pte condo now and downgrade back to hdb during retirement. This is if buying it now is a wise choice towards earlier retirement.

I can only share what I did about 12 years ago, I think.

I transferred from my OA to SA up to then prevailing minimum sum - I think it was 120k. Did both for myself and my wife. By now both our SA has reached ERS already thanks to compounding and the usual organic growth aka.contributiin into SA and I know there will be no problem come retirement..

For me, I settled the retirement part (via OA to SA transfers) before I went for property decoupling and upgrading in 2014 and 2015..

 

[SBC]

I can only share what I did about 12 years ago, I think.

I transferred from my OA to SA up to then prevailing minimum sum - I think it was 120k. Did both for myself and my wife. By now both our SA has reached ERS already thanks to compounding and the usual organic growth aka.contributiin into SA and I know there will be no problem come retirement..

For me, I settled the retirement part (via OA to SA transfers) before I went for property decoupling and upgrading in 2014 and 2015..

How’s your outstanding mortgage now? I have decoupled in 2015. But outstanding mortgage is still high. Close to 800k.

Hope to clear 100k every 3 years.

 

[Toni90]

Property purchase is not a must for me and I have done my sum and I do believe I can afford a pte condo. Whether putting so much funds into 1 investment vehicle is a wise choice is my concern. Pte condo is just part of retirement planning in hope of capital upside 10 to 20 years down the road. It should at least keep pace with inflation imo. This if true is already better than me putting money in bank of about 2% yield at the moment. If there r better way to achieve earlier retirement, I'm more than glad to have a plan change.

Does your wife OK with staying resale condo?

 

[BuiBuiZai]

Does your wife OK with staying resale condo?

Of cos no. She don't mind hdb even.

 

[ELKYme]

Agree, with OA to SA transfer immediately. Especially for your wife because she can transfer a fair amount over. (Note that current FRS is 171k). The 1.5% difference till she’s 55 will make a difference.

I can only share what I did about 12 years ago, I think.

I transferred from my OA to SA up to then prevailing minimum sum - I think it was 120k. Did both for myself and my wife. By now both our SA has reached ERS already thanks to compounding and the usual organic growth aka.contributiin into SA and I know there will be no problem come retirement..

For me, I settled the retirement part (via OA to SA transfers) before I went for property decoupling and upgrading in 2014 and 2015..

 

[ELKYme]

For retirement PLANNING, my opinion is to have a masterplan in place FIRST (before any investment consideration).

1) Calculate the amount needed for a comfortable retirement (Monthly/annual during retirement).
2) The age u want to retire.
3) How to achieve 1&2 (thru regular savings & investing) ~at this point than u will know If property upgrade is plausible.

Retirement planning is a serious matter because ALL of us will retire.

MANY don’t have a detailed “masterplan” in place to serve as a goal (occasionally checking to ensure that we are on track)

If we don’t do this masterplan earlier and discover when we are older (50), that what we have is insufficient to retire on by the desired retirement age, it’ll be a uphill task to make up the difference.