What To Do With Excess $$$

[EmporioArmani]

Hi All,

Recently I have some excess cash due to windfall($4K+). I would like to ask how would you all use this koney to add into your portfolio?

For me, I currently pump $300/Month into G3B and I'm in this for slightly more than 3 years.
I also do swing trades on US Stock Market.

But I would like to put this extra $4K into stocks/something that will give me more dividends every year, preferably 5%/year. I would want to add it to part of my long term portfolio.

Any advice for me?

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[BBCWatcher]

But I would like to put this extra $4K into stocks/something that will give me more dividends every year, preferably 5%/year. I would want to add it to part of my long term portfolio.

Why do you want dividends specifically within a long-term portfolio? Answer: You don't. You want total returns (net of costs).

$4K isn't much. Probably you'd just head over to Standard Chartered, place one order for IWDA (the accumulating global stock index fund), and then join Shiny Things at the pub.

 

[Prof. Utonium]

How long is your long term?

Usually it is more than 5 years. For me is more than 10 years.

5% dividend I belive is on the high range. Don't get toxic products. Go for growth.

 

[churnmaster]

Why do you want dividends specifically within a long-term portfolio? Answer: You don't. You want total returns (net of costs).

$4K isn't much. Probably you'd just head over to Standard Chartered, place one order for IWDA (the accumulating global stock index fund), and then join Shiny Things at the pub.

Which pub btw?

 

[BBCWatcher]

Another possibility if you qualify for tax relief is to deposit that $4K into your CPF MediSave Account, Special Account, or a little of both. That'll earn at least 4% interest, plus the tax relief if you qualify. Which will be automatically reinvested (compounded annually).

A MediSave Account top up must fit within two limits: the CPF Annual Limit and the Basic Healthcare Sum. There's no separate tax relief limit associated with MA top ups. A Special Account top up must fit within the Full Retirement Sum, and the tax relief limit is $7,000. (There's another $7,000 of tax relief potentially available if you top up a qualified family member's SA or RA.)

If you're going to make a CPF top up with tax relief, I'd do it now, to make sure it's credited within April, 2019, since we're getting near enough the end of the calendar month. If so, that means you'll start collecting interest on the top up from May 1, 2019.

MA is for qualified medical spending in Singapore, including MediShield Life and Integrated Shield base plan premiums. SA is for your retirement, and your top up will stream out via CPF LIFE monthly payouts. CPF assets are extremely well protected from creditors and court judgments, and they're backed by the full faith and credit of the AAA-rated Singapore government.

 

[addict951]

ts, buy ES3 STi ETF, lo-risk
Every 1/2 year, about 6c CD

 

[EmporioArmani]

Thanks guys for your comments. I was thinking of dividend because so that i could reinvest them either back into the same product or maybe another stock. Get what you(BBCWATCHER) mean by total return is more important.

For IWDA, is it possible that I buy using IB instead, and instead of putting 4K 1 shot, i split them out to ride the fluctuations, just in case i bought at a high, before they start sliding down for the near term.

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[BBCWatcher]

For IWDA, is it possible that I buy using IB instead, and instead of putting 4K 1 shot, i split them out to ride the fluctuations, just in case i bought at a high, before they start sliding down for the near term.

Possible, yes, but IB charges a monthly minimum commission starting the 4th month after account opening if your total account value is below US$100,000. Unless you're going to continue to buy IWDA every month -- that'd be nice -- the monthly minimum commission won't be helpful.

S$4K (or US$4K) isn't enough money to worry about splitting into multiple purchases. Yes, I know, it's more than the $3,600/year you've been pushing into G3B, but it's not so much that you need to incur multiple brokerage commissions just to split it up. Maybe chop it in two if you really want ($2,000 and $2,000), but you'll have to pay two brokerage commissions for that.

 

[EmporioArmani]

Possible, yes, but IB charges a monthly minimum commission starting the 4th month after account opening if your total account value is below US$100,000. Unless you're going to continue to buy IWDA every month -- that'd be nice -- the monthly minimum commission won't be helpful.

S$4K (or US$4K) isn't enough money to worry about splitting into multiple purchases. Yes, I know, it's more than the $3,600/year you've been pushing into G3B, but it's not so much that you need to incur multiple brokerage commissions just to split it up. Maybe chop it in two if you really want ($2,000 and $2,000), but you'll have to pay two brokerage commissions for that.

Yeap get what you mean for the part about splitting the amount up. For the commission part, I'm not worried about it for jow because I'm actively trading and my commission will hit more than 10USD/month.

I saw somewhere in some thread(but can't remember which thread and can't seems to find it now) that for IWDA, it is traded in LSE, but there is actually an equivalent for it in the US Stock Market. Is it true? Cause i roughly see it some time back.

Cause I thought about long term hold for IWDA too, but it would be even better if there is an equivalent in US stock market so i don't have to change to multiple different currency for it

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[EmporioArmani]

Oh yes, thinking back to why I started this thread, answer to you guys questions on why I want to have dividends is because I wish to retire early, with consistent dividend cashflow coming into my bank account, without the need to take out any capital from the market(until I'm really so damn old that i decided to take out everything and YOLO for the last 10-15 years of my life), so that my cashflow will be "unlimited"

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[BBCWatcher]

I saw somewhere in some thread(but can't remember which thread and can't seems to find it now) that for IWDA, it is traded in LSE, but there is actually an equivalent for it in the US Stock Market. Is it true? Cause i roughly see it some time back.

There is, but unless you're a U.S. person you don't want it for tax reasons.

Cause I thought about long term hold for IWDA too, but it would be even better if there is an equivalent in US stock market so i don't have to change to multiple different currency for it

IWDA is priced and quoted in U.S. dollars. There's a British pound priced equivalent (SWDA) if you prefer that. You're buying exactly the same thing either way -- and neither one is any currency. It's a fund of stocks listed/traded in developed economy stock markets. Once you exchange a currency for the fund, you no longer own that currency. Just like once you trade Turkish lira for an Apple iPhone, you no longer own those Turkish lira -- you own an iPhone.

 

[BBCWatcher]

Oh yes, thinking back to why I started this thread, answer to you guys questions on why I want to have dividends is because I wish to retire early, with consistent dividend cashflow coming into my bank account, without the need to take out any capital from the market(until I'm really so damn old that i decided to take out everything and YOLO for the last 10-15 years of my life), so that my cashflow will be "unlimited"

OK, but in the meantime you have to pay higher brokerage costs to reinvest distributed dividends, which means you won't be able to retire until that much later because you'll be that much poorer having incurred higher investment costs.

And what's the problem with selling a block of shares quarterly (for example) when you want to raise some Singapore dollars to buy plates of chicken rice? Yes, you'll pay a commission to do that, but those quarterly deferred commissions will cost much less than the commissions involved in reinvesting dividends plus the cost associated with time out of the market. If selling blocks quarterly is too difficult, no problem, sell IWDA (for example) and replace it with VWRD. VWRD is a distributing global stock index fund and kicks off dividends. Or buy a life annuity which pays monthly. Or some of both.

 

[wutawa]

Hi All,

Recently I have some excess cash due to windfall($4K+). I would like to ask how would you all use this koney to add into your portfolio?

For me, I currently pump $300/Month into G3B and I'm in this for slightly more than 3 years.
I also do swing trades on US Stock Market.

But I would like to put this extra $4K into stocks/something that will give me more dividends every year, preferably 5%/year. I would want to add it to part of my long term portfolio.

Any advice for me?

Sent from Xiaomi MI 8 using GAGT

I will buy MapleTree Ind Tr if I want 5% p.a. div

 

[henrylbh]

Hi All,

Recently I have some excess cash due to windfall($4K+). I would like to ask how would you all use this koney to add into your portfolio?

For me, I currently pump $300/Month into G3B and I'm in this for slightly more than 3 years.
I also do swing trades on US Stock Market.

But I would like to put this extra $4K into stocks/something that will give me more dividends every year, preferably 5%/year. I would want to add it to part of my long term portfolio.

Any advice for me?

Sent from Xiaomi MI 8 using GAGT

My 4k plus was not a windfall but side income that became a mini windfall

I placed the cold hard cash in an envelope and hid it in one of my books on the bookshelf in my study room. It was there for don't know how many years and I completely forgotten about it and who was it from

When moving house about 20 years later, the enveloped fell of the books

Fortunately it was there despite renting out my house for the last 6 years with my belongings in the storeroom

 

[EmporioArmani]

There is, but unless you're a U.S. person you don't want it for tax reasons.


IWDA is priced and quoted in U.S. dollars. There's a British pound priced equivalent (SWDA) if you prefer that. You're buying exactly the same thing either way -- and neither one is any currency. It's a fund of stocks listed/traded in developed economy stock markets. Once you exchange a currency for the fund, you no longer own that currency. Just like once you trade Turkish lira for an Apple iPhone, you no longer own those Turkish lira -- you own an iPhone.

Sorry late reply. Was kinda busy for work these week. Okay so if I were to use IB account, i just need to have USD $$$ and I can just buy IWDA from there right? I will take a very serious consideration about your recommendation, and weigh the pros and cons as compared to the others! So thankful for your comment/suggestions!

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[EmporioArmani]

I will buy MapleTree Ind Tr if I want 5% p.a. div

Yeap that is one of the stock I am eyeing. Was looking through their financials for the past few years and they actually look pretty good!

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[EmporioArmani]

My 4k plus was not a windfall but side income that became a mini windfall

I placed the cold hard cash in an envelope and hid it in one of my books on the bookshelf in my study room. It was there for don't know how many years and I completely forgotten about it and who was it from

When moving house about 20 years later, the enveloped fell of the books

Fortunately it was there despite renting out my house for the last 6 years with my belongings in the storeroom

That is really a nice "windfall"!! Not sure if you have this feeling, but when you found a $5 in your pants pocket which you are wearing and it's like extra money someone has gave you hahaha, just that yours is in thousands!!

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[BBCWatcher]

Okay so if I were to use IB account, i just need to have USD $$$ and I can just buy IWDA from there right?

You can deposit Singapore dollars in your IB account, and then IB can convert those Singapore dollars to U.S. dollars extremely affordably. Then you can buy IWDA, yes.

As a reminder, IB charges a minimum monthly commission unless your total account value is US$100,000 or higher. If you're buying something every month (for example buying U.S. dollars, then buying IWDA with those U.S. dollars), that works.

 

[RMCWMR]

I will buy MapleTree Ind Tr if I want 5% p.a. div

Might as well buy dbs. also 5% div but with better appreciation

 

[smart alex]

Buy DBS stock