Target networth

[revhappy]

wow thanks for the revised version. removing the *** U money part makes it more family friendly when I want to discuss with relatives and friends on finances....

Also, I just jumped from stage 4 to stage 7! Now working towards stage 8

Until stage 6 is very easy to quantify. My networth is worth probably 20 yrs or more than annual expenses. But I don't have any passive cashflow. I don't believe in it. I prefer growth assets which can be sold in small amounts every year.

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[minamikaze]

Hmm nobody's born a great parent. It's easier to retire earlier with no kids, especially on dual income if both grads. But I'm just thinking. So you don't intend to have kids, and then you've accumulated all the networth. And well after you retire and all that where's it going to?

It just tickles my curiosity because I see quite a number of single high flying folks working their butts off till old age accumulating all that wealth for I m not sure what.

Why do we necessarily have to leave our wealth to kids? Could we not use it to do something meaningful - start some side venture, start a charity of some sort, etc? I don't have specific plans in mind but if I didn't have a kid, I would be going towards that direction, I think.

Until stage 6 is very easy to quantify. My networth is worth probably 20 yrs or more than annual expenses. But I don't have any passive cashflow. I don't believe in it. I prefer growth assets which can be sold in small amounts every year.

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This makes sense also to some extent. If you already have a lot of non-passive income assets (be it cash, equity etc), it's easy to convert that to passive-income generating assets, if someone is so inclined. Growth in assets itself is also a form of passive income, anyway.

 

[rottingapple]

Super satki

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im chao peasant earning low pay.

what if u not single then

Dunno, guess with housing and children financial plans will go haywire

Cash? Why only can aim for this when single??

My new aim after paying off my mortgage is to try saving 100% of my take home pay and live on rental income n dividends+interests. I think that's a good way to test if I can stop working and rely on my passive income.

I dunno anything about investment, no time to read up at the moment .
Currently my citibank maxigain interest earned per mth is only $230. Haha.

 

[havetheveryfun]

im chao peasant earning low pay.

Dunno, guess with housing and children financial plans will go haywire

I dunno anything about investment, no time to read up at the moment .
Currently my citibank maxigain interest earned per mth is only $230. Haha.

wow per mth 230.. means u got like 200k + cash

 

[Sinkie]

wow per mth 230.. means u got like 200k + cash

Capped at $150,000 la

 

[WindBoi]

Until stage 6 is very easy to quantify. My networth is worth probably 20 yrs or more than annual expenses. But I don't have any passive cashflow. I don't believe in it. I prefer growth assets which can be sold in small amounts every year.

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that is cash flow. selling assets to generate cash flow is cash flow. and i dont think i refer to as passive cash flow. its just cash flow.

 

[Wishdom]

I am 26 years old currently.

Looking at networth of 1m dollars not including house and cpf. The full 1m will be in vwrd. I will live off the 2% dividends per year. I love volatility.

Only at 20k in vwrd now though.

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[havetheveryfun]

Capped at $150,000 la

sorry boss.. didnt realize now maxigain giving more than 2% interest liao for those accounts older than 12 months... maybe shuld go n open an account soon too

I am 26 years old currently.

Looking at networth of 1m dollars not including house and cpf. The full 1m will be in vwrd. I will live off the 2% dividends per year. I love volatility.

Only at 20k in vwrd now though.

Sent from Ilovennp using GAGT

so how u plan to achieve that 1m.. purely through working a salaried job ?

 

[Wishdom]

sorry boss.. didnt realize now maxigain giving more than 2% interest liao for those accounts older than 12 months... maybe shuld go n open an account soon too



so how u plan to achieve that 1m.. purely through working a salaried job ?

I can do with 600k too ; Technically. That is far more reasonable and achievable. A 2% return on 600k gives me 1k/mth.

It will take me 33 years of salary to hit 600k. 1m is just a nice dream to have.

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[havetheveryfun]

I can do with 600k too ; Technically. That is far more reasonable and achievable. A 2% return on 600k gives me 1k/mth.

It will take me 33 years of salary to hit 600k. 1m is just a nice dream to have.

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yes i also used to think that way as u but then others will say still got inflation blaha blah.. and dont think 1k per month after 33 years will have the same purchasing power the same as now

 

[limster]

The most funny thing here in this forum is that there are just a bunch of people, someone who has little money and little track record of high CAGR returns over long period claiming that the others (even those with high CAGR returns over long period and have money as a result) that they don't understand investment etc blah blah blah!

i see a lot of people neglecting investor psychology which suggests that most actually weren't investing during the GFC. Many investors don't know how to handle a correction or crash. Either totally paralyzed and stop investing, or worse still, sell everything. Then when market recover, instead of buying, they post repeatedly in MM/SSI asking whether can buy now...

this is where property investors have the advantage as they are locked into an illiquid asset and committed to repaying the loan. When the crash comes, as long as they can keep up the repayments, they will just keep on repaying until the recovery comes.

Their loan repayments are equivalent to the Dollar cost averaging payments of stock investors (with the added bonus of using leverage) that investors are supposed to do regularly, but because of fear, many stop DCA during crashes.

But having said that, my property buying skills maybe not so fantastic, my current home which i bought at the tail end of the GFC, hasn't actually appreciated that much in value compared to my shares...

 

[Wishdom]

yes i also used to think that way as u but then others will say still got inflation blaha blah.. and dont think 1k per month after 33 years will have the same purchasing power the same as now

That's where cpf comes in. It's my base for retirement income. I'm not married and I don't have kids.

It's also why I'm putting all my money in vwrd.

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[revhappy]

that is cash flow. selling assets to generate cash flow is cash flow. and i dont think i refer to as passive cash flow. its just cash flow.

But then how do you quantify cash flow > expenses to reach stage 7? You can simply sell enough to ensure that it is more than expenses. But that may result in the wealth not lasting long enough.

I think passive income is mainly rent, interest and dividend etc. But in my view because of the predictability of this income stream, it comes at a cost which is low returns compared to growth assets. Since growth assets don't have to perform linearly, they are supposed to return much more in the long term.

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[limster]

But then how do you quantify cash flow > expenses? You can simply sell enough to ensure that it is more than expenses. But that may result in the wealth not lasting long enough.

I think passive income is mainly rent, interest and dividend etc. But in my view because of the predictability of this income stream, it comes at a cost which is low returns compared to growth assets. Since growth assets don't have to perform linearly, they are supposed to return much more in the long term.

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i find the model very useful, however i'm sure there is no one-size-fits-all which is why there is an entire industry centred around giving financial advice. So you can either ignore it and follow a different model, or try to adapt this one to your needs

 

[rottingapple]

wow per mth 230.. means u got like 200k + cash

Nah, not even hit 120k. Guess its due to Sibor.

 

[What2do4life]

Think you said it very well indeed about property investment!

So does it mean that ppty investment is the way to go in Asia???

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[Thoreldan]

So does it mean that ppty investment is the way to go in Asia???

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I'm curious to know as well.

For an average earning couple, property or equity investment is more suitable looking at 20-25 yrs horizon...

 

[BBCWatcher]

So does it mean that ppty investment is the way to go in Asia???

There’s so much wrong with this question!

Will the real estate sector under or over perform other sectors, on a total net return basis over a particular time period and relative to current valuations? Nobody has a crystal ball.

Will Asia under or over perform other continents, on a total net return basis over a particular time period and relative to current valuations? Nobody has a crystal ball.

Since nobody has a crystal ball — you’re asking the question, so surely you don’t — why would you under or overweight either a particular sector or a particular continent? You wouldn’t and shouldn’t. Just invest globally and across all sectors, and that’s that.

You may decide to overweight your particular country — the country where you plan to retire, for example — in certain ways. But that’s usually not a problem. Buying a primary residence that’s reasonable in the circumstances accomplishes that.

Stock index funds include the real estate sector, already. That’s most certainly true of the Straits Times Index (e.g. ES3), and it’s also true of the U.S. S&P 500.

 

[BBCWatcher]

Buying REITs and property stocks are very poor way of getting expose to property assets because of too many leakages and many layers of additional costs, so much so that they become lousy assets to hold over a long term (of 20 years or more)!

Sure, there are no costs involved in buying, holding, and managing individual properties. And an individual is surely more efficient than a large real estate company that specializes in real estate.

 

[Sinkie]

I'm curious to know as well.

For an average earning couple, property or equity investment is more suitable looking at 20-25 yrs horizon...

For average earning couple, bto is your first pot of gold