SRS Portfolio

[BBCWatcher]

What happens for a regular annuity plan purchased using SRS? Like in my case, the regular payouts go for 15 years from age 65 onwards.

That'd be classified as "insurance."

By the way, why did you choose a limited annuity with a 15 year payout?

 

[romeo88]

Same for me, Schroders Asian has always been a big winner for me. But gotta be mindful when the market crashes, its value will drop very quickly too. I'd put it as high-beta portfolio.

My wife has her SRS in Schroder Asian Growth Fund. Seems to be pretty good though you should compare with other funds and get advice from the veterans here.

 

[bin8lee]

You can start later than age 62, but once you start you have 10 calendar years to make all your withdrawals. If you don't withdraw everything within the 10th calendar year, your entire remaining SRS account balance is deemed withdrawn, in full, for Singapore income tax purposes. And you owe/pay income tax accordingly....

....With one exception. If you buy a fully SRS qualified single premium life annuity from Manulife, the only annuity provider currently offering such a product, then the payouts from that qualified life annuity can run beyond the 10 calendar year limit. The premium reduces your SRS balance and is not treated as a withdrawal, and the payouts are factored into the tax calculation in each of their calendar years -- 11th, 12th, 15th, 18th, whatever, as long as you live. If the annuity payout is $40,000 or less per calendar year, and if you have no other taxable income, then your Singapore income tax should be zero.

Hi BBCW,

How about AXA Retire Treasure II?

 

[Peasantboy]

Do you invest in multiple funds using SRS or just this fund? Any funds to recommend?

Same for me, Schroders Asian has always been a big winner for me. But gotta be mindful when the market crashes, its value will drop very quickly too. I'd put it as high-beta portfolio.

 

[romeo88]

Fidelity Australia. Just a word of caution, the market is picking up a lot recently. My present strategy is to wait out, in cash or low-beta portfolios.

So I've switched out to many other low-beta UTs,

Do you invest in multiple funds using SRS or just this fund? Any funds to recommend?

 

[Peasantboy]

Thanks! Will heed your advice on that

Fidelity Australia. Just a word of caution, the market is picking up a lot recently. My present strategy is to wait out, in cash or low-beta portfolios.

So I've switched out to many other low-beta UTs,

 

[blue_denim24]

Guys, Can one buy G3B STI ETF via POSB InvestSaver using the DBS SRS Account?

 

[BBCWatcher]

How about AXA Retire Treasure II?

At present Manulife is the only provider of fully SRS qualified life annuities, the type that allows you to stretch the tax advantaged withdrawal window beyond the maximum 10 calendar years allowed. Most people don't have this particular problem, but if you're going to end up with a big, fat SRS account balance, and/or if you're expecting a lot of taxable income during retirement (such as rental income) such that you'd prefer to stretch out your SRS withdrawals, then you could take a look at what Manulife is offering in this segment.

 

[blackvice]

At present Manulife is the only provider of fully SRS qualified life annuities, the type that allows you to stretch the tax advantaged withdrawal window beyond the maximum 10 calendar years allowed. Most people don't have this particular problem, but if you're going to end up with a big, fat SRS account balance, and/or if you're expecting a lot of taxable income during retirement (such as rental income) such that you'd prefer to stretch out your SRS withdrawals, then you could take a look at what Manulife is offering in this segment.

Interesting concept. how does the annual paid out of such plans helps to reduce the tax or accumulation and lump sum paid out?

SRS members have a ten-year period to make withdrawals from their SRS account. Any amount remaining in the SRS account after 10 years will be automatically considered as a lump sum withdrawal, with 50% of the amount subject to income tax. Meaning to say, by stretching the 10 calendar years, the lump sum withdrawal tax does not applies?

 

[Peasantboy]

Guessing it works like COF Life (another annuity) - you place a lump sum from your SRS with Manulife then they provide monthly income till end of life.

This way, your lump sum from SRS is “invested” and the lifelong stream of income exceeds the 10 years deadline for SRS withdrawals

Interesting concept. how does the annual paid out of such plans helps to reduce the tax or accumulation and lump sum paid out?

SRS members have a ten-year period to make withdrawals from their SRS account. Any amount remaining in the SRS account after 10 years will be automatically considered as a lump sum withdrawal, with 50% of the amount subject to income tax. Meaning to say, by stretching the 10 calendar years, the lump sum withdrawal tax does not applies?

 

[BBCWatcher]

SRS members have a ten-year period to make withdrawals from their SRS account. Any amount remaining in the SRS account after 10 years will be automatically considered as a lump sum withdrawal, with 50% of the amount subject to income tax. Meaning to say, by stretching the 10 calendar years, the lump sum withdrawal tax does not applies?

Guessing it works like COF Life (another annuity) - you place a lump sum from your SRS with Manulife then they provide monthly income till end of life.

This way, your lump sum from SRS is “invested” and the lifelong stream of income exceeds the 10 years deadline for SRS withdrawals

That's correct.

It's pretty simple, really. One you start SRS withdrawals, you have a maximum of 10 calendar years to make qualified withdrawals -- no "off" years allowed. So if you start withdrawals within the year 2023 when you're age 64 let's suppose, then 2032 is your last withdrawal year. Everything that isn't withdrawn by December 31, 2032, is deemed withdrawn and taxed at ordinary income tax rates (on 50% of the withdrawal amount)....

....Except for payouts from a fully SRS qualified life annuity from Manulife (and formerly from NTUC Income, which also sold a fully SRS qualified life annuity in the past). Those life annuity payouts are NOT deemed SRS withdrawals until they're actually paid no matter how long that takes (i.e. no matter how long you live). So you can bust way past 2032 using that particular product, if you wish.

 

[henrylbh]

And pray that your bequest is not large when you uplorry?

 

[cheebuu]

Guys, Can one buy G3B STI ETF via POSB InvestSaver using the DBS SRS Account?

Unfortunately, it is not possible at this moment via POSB Invest Saver. But you can use OCBC Blue Chip with SRS.

 

[assiak71]

The period is too short to be of any meaning. and the returns is not important. What is important is how the investments fit into my overall portfolio strategy, and I subscribe to the popular "3 fund portfolio" strategy with local bonds, local equities and global equities.

For Singaporeans, because of the rules of what can be purchased using CPF and SRS and the rates that we are getting with CPF OA/SA, I think the optimal strategy is to treat CPF holding as your bond portfolio, use SRS to purchase ES3 for local equities, and use cash to purchase IWDA for global equities.

I agree that those who invest in eg 3 fund porfolio, srs portion is quite easy.

Problem is for those who dont. Eg cash is in individual stocks. How should these people invest their srs? 3 fund portfolio within srs?

 

[tangent314]

Problem is for those who dont. Eg cash is in individual stocks. How should these people invest their srs? 3 fund portfolio within srs?

Easy way: Lion Global All Seasons (Growth)
Harder way: SSB/MBH + ES3 + Lion Global Infinity Global Stock Index Fund

 

[assiak71]

Easy way: Lion Global All Seasons (Growth)
Harder way: SSB/MBH + ES3 + Lion Global Infinity Global Stock Index Fund

In other words create a srs portfolio without considering cash portfolio.

Another way: stashaway

 

[brooksky]

Easy way: Lion Global All Seasons (Growth)
Harder way: SSB/MBH + ES3 + Lion Global Infinity Global Stock Index Fund

If I were to follow the harder way, is there any hidden fees I need to be aware of when doing portfolio balancing for Lion Global Infinity Global Stock Index Fund? I have experience on ES3 and IWDA but not on unit trusts.

 

[tangent314]

If you use Poems or Dollardex, there won't be fees for buying/selling/switching this unit trust.

 

[blurpandasg2014]

How about TM Retirement SP? Able to withdraw over 20yrs

 

[andyhtc]

If you use Poems or Dollardex, there won't be fees for buying/selling/switching this unit trust.

Unit trusts have maintenance fee. I prefer to buy good dividend stocks using SRS and collect dividends until I retire many years later.