Posts

Featured Post

Progression of my Mom's CPF account

Image
Following up on my previous post on 'Helping your parents maximize their CPF account', I had gotten permission from my mom and have decided to share how my Mom's CPF account grows over the year as it was being faithfully topped up and earned interests throughout the years.Her account started with about $3400 in her RA and $3200 in her OA and was only earning about $370 in interest. This was at the end of 2016.
After transferring all her OA to RA and topping up $7000 to her RA for tax relief, her RA reached about $14,000 and is getting close to $680 in interest in 2017.
With a further $7000 top up, her RA grows to $22,000 and is earning about $1200 in interest in 2018.
2019 was the year where on top of the $7000 top up for tax relief, I started to transfer my OA to her RA to quickly hit $60,000 for the 5% and 6% interest in RA. her RA grows to $50,000 and is earning about $2300 in 2019.
This year, 2020, her Retirement account had already surpassed $60,000 and is going to earn a…

Help your Parents maximize their CPF account

Most of our parents are not aware of the many CPF rules and are not making full use of CPF to help them in their retirement. In fact I have only started to learn and understand more about CPF a few years ago and in that journey, I have also started to monitor my Mom's CPF account and slowly helping her to fully maximize its benefit. Below are some of the actions that I had or wished I had taken to help her maximize her CPF account.Prepare them for Special Account (SA) shielding. I had talked about SA shielding in my previous post but unfortunately, I didn't managed to do this for my Mom since she was way past 55 when I started looking at her CPF account a few years ago. Also my mom was a full time homemaker and there was not much in her CPF account for SA shielding to make sense. If your parents have not reached 55, you can start to help them plan for SA shielding. The aim is to have sufficient in their Ordinary Account (OA) such that they can hit Full Retirement Sum (FRS) in …

Update on my value portfolio

It has been a looooong time since I did an update of my value portfolio. One of the reason is because I have exceeded the 30 free transaction as a basic user of StockCafe and can no longer update my account with anymore transactions. I had to move to doing manual tracking after that but it became too much of a hassle and I eventually stopped doing it.On top of that, I have been pretty busy with work and was too drained to do any tracking and re-balancing. It is actually not difficult to do re-balancing but it is time consuming to do the search of value stocks using the set of criteria and then sell or purchase them accordingly. This is especially so when I have a basket of 10 to 15 value stocks which are typically low on liquidity. Hopefully I can pick up the re-balancing again as I get more time.After a couple of years of holding these value stocks and collecting dividends, 2 of them gave me a surprise recently. Colex recently gave out a special dividend of $0.1 which is about 50% of…

Update on my SRS account

Image
This is a quick update on my SRS account.I had eventually decided to go with Endowus for my SRS funds. I like the transparent and low fees that Endowus is providing for retail investor like me to gain access to some of the best global equity funds. You can see some of the comparison I did here for SRS investment.However, I feel that the global equity market is recovering way ahead of the actual economic recovery. As such I have put my SRS into Cash Smart Enhanced for now. I know I should not be timing the market but putting in a lump sum into the equity market now gets too emotional for me. So I have decided to put my SRS into Cash Smart Enhanced to earn a higher interest than 0.05% while I slowly DCA into the 100% Equity funds.So far for about 2 months into Cash Smart Enhanced, it is already giving me way more returns than what OCBC would have given me in a year.  Something I noticed is that I cannot transfer my funds directly from Cash Smart Enhanced to Equity funds directly to perf…

CPF calculator update and Happy National Day!

Thanks to the many feedback I am getting from people using the CPF calculator, I have managed to add in more features along the way that hopefully benefited even more people. In this latest update, I have added in more flexibilities as well as option for ERS. Do check out the updated CPF calculator. This addition comes from a number of request I am getting from users in the 1M65 telegram group. 1M65 is a movement by Loo Cheng Chuan and had benefited me a lot in how I can use CPF as my financial safety net so that I can take more risk in my cash investment. If you are not familiar with the 1M65 movement, you can read more about it here. I would encourage you to join this 1M65 telegram group if you are keen to find out more on how you can use CPF to help you financially. It is a wonderful group with many helpful and knowledgeable individuals sharing about CPF and other financial matters.I would also like to wish everyone a Happy National Day here. Although this year's NDP is going t…

Did you manage to correctly time the Market during the Covid-19 crash?

Well I certainly did………….. Not….. I wished that I had correctly timed the market and bought into the market at its lowest during March. I also wished that I was so confident about it that I had dumped a huge chunk of my war chest into the market. Unfortunately, that is just not possible…. Well, not for me anyways.... Emotionally, it is just too difficult. The next best thing that I can do, which is what I actually did, is to buy on the dip. I was buying a small amount of STI when the market was going down by more than 1% and I would buy more if it goes down more. At least by doing that, I managed to deploy some of my war chest into the market at an ok average price. Emotionally, if STI goes up, I am happy. If STI goes south, I am happy for the opportunity to accumulate more. Either direction, I wouldn't be too affected by the volatility and this makes it easier for me to stay in the Market. This is definitely better than still holding on to the cash and still waiting for the marke…

Wrong post wrong time?

Recently, I published a post on CPF Accrued Interest that have gotten quite a bit of comments. You can find the post here.Firstly I would like to apologize if the post was insensitive. Also, I could not have chosen a worse time to post that online in the mist of Singapore's General Election. I had turned off comments for that post as some of the comments have gotten a bit political and that is not the intent of the post or blog. I would like to clarify that I had no intention of using that post to influence anyone politically. I have setup this blog to document my financial journey and is not meant to be political in any shape or form.Secondly, I appreciate all the comments on what I had shared in that post. Some of you have shared that accrued Interest could be bad for some people which I can appreciate. I can understand how under certain circumstances the accrued interest can be a drag on people's personal finances especially when they get hit by unfortunate events through n…

Where should I invest my SRS monies?

I have been on a hunt for suitable investment for my SRS monies since I opened my SRS account and started contributing to it last year. You can find my considerations when setting up my SRS account here.The bank interest rate for the SRS account is at a measly 0.05%. This guarantees that the money inside will be eaten up by inflation if I do nothing about it. I had actually put the money into Singapore T-bills soon after I made a deposit to my SRS account. This gave me some time while I search around for a suitable longer term investment.I am looking for passive index investing to add on to my existing portfolio. So far I came across 3 suitable one for investing with SRS below.OCBC-Blue Chip Investment PlanEndowus - 100% EquityMoneyOwl - 100% EquityFunds/EquitySome Singapore Blue ChipSingapore STI, REIT and Bond ETFDimensional Global Core Equity FundDimensional Emerging Markets Large Cap Core Equity Fund
Dimensional Pacific Basin Small Companies FundInfinity US 500 Stock Index FundDime…

Why CPF Accrued Interest on your Housing loan might actually be good

The CPF Accrued Interest on your Housing loan has been a problem for many people for a very long time. The most common complaint is why do I have to pay interest when I am using MY OWN MONEY. I guess it is understandable why many people are unhappy with the government trying to micro-manage people finance. However, Accrued Interest might actually not be a bad thing.
Here are some of the reasons why your CPF Accrued Interest can be good for you (and no… CPF did not pay me to write this)First and foremost, if the selling price (including the option monies) after paying the outstanding housing loan is not enough to fully refund the CPF principal amount withdrawn together with the accrued interest, you do not DO NOT need to top up the shortfall in cash, provided the property is sold at market value. The principle loan and accrued interest is still YOUR MONEY and not money that you owe CPF that you have to return. So don't get too overly concern with the accrued interest.The Accrued Int…

You don't have to be rich to give to Charity

Image
I am sure many people are keen to give to charity. However, the most common reason why they have not is that they don't have "spare cash" to give and they don't have the time to give as well.Well in this day and age, you don't have to be "rich" in cash or time to give to charity. Technology has brought us Tab for a Cause. It is a Google Chrome extension that you can add to your Chrome Browser that Raise money for charity every time you open a new browser tab. It's free and incredibly easy. Now you can give to good cause by doing what you will usually do every day, opening a Chrome tab and surfing the web. No need to be rich or free!What Tab for a Cause does is that it will replace your usual Chrome tab interface with the one below. It is a simple interface with some simple functionalities and ads on the side. The ads impression is how they earn money to support their operations and donate to charities. The new tab interface also shows the total amou…

2 CPF Hacks when you turn 55?

Image
Hack 1: CPF Special Account ShieldingI am sure most of you have heard of "CPF SA shielding" before. There are many articles written on it and I think Seedly info-graphics below summaries it quite well.In brief, CPF shielding is actually a hack on the CPF system when you turn 55. At age 55, the following will happen.CPF will setup a Retirement Account (RA) on top of your existing OA, SA and MA.CPF will first transfer your SA to RA to meet the prevailing FRS.If the amount in your SA is insufficient to meet the FRS, your OA will get transferred to your RA to meet the prevailing FRS.When you hit FRS in your RA, you can withdraw the rest of the monies in your OA and SA, treating them essentially like a high interests savings accountSince monies in SA earn a higher interest than in OA, you will want to keep more money in your SA than OA. However, CPF always prioritize the transfer of funds from your SA to your RA. Hence "CPF SA Shielding" is a hack where you shields your…

Launch of the CPF calculator!

With the circuit breaker and working from home, I am finding more time for myself and my family. I guess that’s the only good thing that come out from the COVID-19 pandemic.With that spare time, I have been looking at my CPF more and finding myself looking for CPF calculators to forecast my CPF savings and how to maximize the CPF benefits for my retirement. There are some calculators out there but they do not give me the flexibility to adjust some of the variables. So I had to go back to basics and work on excels sheets.That was when I realized that the rules for CPF are so complicated that the excel formulas just gets more and more confusing as I tried to add in more rules. Fortunately, I had some experience with coding during my University years and eventually had to resort to using visual basics to code out the calculation (which is still challenging but more manageable).I spent quite a number of days on it and decided why not share this CPF calculator with other people so that the…

2.5% interest with no lock in during this time??

Image
The interest rate are falling all over the world. And we have seen this cascade down to the interest rate we are receiving from banks. With DBS, Standard Chartered cutting down their savings interest rate, it it quite hard to believe that Singlife is able to provide 2.5% interest for their Insurance Savings Plan. If you sign up with my link here and activate your Singlife debit card, we will both get $10!
Went to their site to find out more and below are some info-graphics if you are interested to 'Insursave" with them. Some points to take note is that 2.5% interest rate is only for the first $10,000. Subsequent amount up to $100,000 is at 1% interest rate, which is still higher than most bank.There is no lock in Period. You can deposit and withdraw via FAST bank transfer. I can only see the withdrawal option via mobile phone App now. And yes, I have tried to deposit and withdraw from Singlife.The "Insursave" comes with retrenchment benefits which is think is quite go…

How I saved some money during the Circuit Breaker period

Image
The 2 instant water heater for shower room at home turned 10 years old recently. My wife has been complaining about the low water pressure coming out from them and asking me to replace them for a while now. I was googling on suitable replacement for them but couldn't really find the time to compare and finalized on a good one.
After the Circuit Breaker (CB) kicking in last week, I finally get the time to clear off some of my "household backlog". In fact I have so much time on hand that instead of trying to find a suitable instant water heater online, I disassemble my current one to see what's causing the water pressure to be so much lower than I first bought it 10 years ago.
After some loosening of screws and detective work, I found that there is a flow control valve in the instant heater that is causing the water pressure to be so low. With the time on hand, I didn't stop there. I disassemble the control valves to see why is it restricting the flow. After some m…

You cannot withdraw interest earned, government grant and top ups from your CPF at 55??!!??

Image
Recently, I was having a discussion with my colleague on CPF withdrawal at 55 when he mentioned that we cannot withdraw any top up monies or interest earned!

All the while I am only aware of the below 3 withdrawal scenario for CPF withdrawal at 55. We can withdraw

1) All of our Special Account and Ordinary Account savings if we have $5000 or less.
2) $5000 if we have less than FRS
3) $5000 or any amount above FRS if we have more than FRS

I was not aware that any top up monies and interest earned being excluded from the above! I have been faithfully topping up my SA and earning the 4% interest to build up my retirement nest egg for a meaningful withdrawal at 55!!

I did some research and found below information from CPF website here.


I have also sent and email to CPF to clarify the above statement. You can see the response from them below with an example as well below. Seems like the exclusion is only applicable to lump sum withdrawal from the Retirement Account only. Once your RA is fo…

Who wants to be Rich By Retirement?

I have just recently finished a book titled "Rich By Retirement" by Joshua Giersch (a.k.a Shiny Things on HWZ).
I would say this book is really a pleasant and easy read. I would recommend this book for anyone who wants a fuss free method of constructing your portfolio that works!
Below are some of the key points I have managed to digest from the book.
1.Make sure you have some liquid cash on hand before you do any investment. The liquid cash should cover 6 months of your expenses just in case you lose your job. I have my liquid cash in POSB and SSB earning about 1 to 2% interest. 2.You should have yourself covered with hospitalization insurance. Insure with term life insurance if you have dependents. The Medishield Life (MSL) plan from CPF should cover the hospitalization insurance. The term life should cover your dependent expenses until they are self-reliant. I got my MSL covered but need to add on to my life insurance. 3.The rest of your savings after covering all of your expe…

Are you prepared for the Coronavirus?

Image
What a way to start a lunar new year..... Not with the good old chilled Corona Beer but with the new and infectious Coronavirus.... 
So, are you all prepared for the Corona Virus?
And noooo, I don't mean the surgical mask, thermometer or sanitizer. I'm sure most of you have gotten all of these to combat the spread of the Virus since they are all sold out in the pharmacies and all major supermarket!
What I mean is are you all prepared for the "blood" in the stock market? The STI index has dropped about 3% since the first trading day after CNY on the 28 Jan 2020 after the news of infected cases increasing in China. Is it going to drop further? Will this be another repeat of 2002 SARS? I don't have an answer to that
But what I am doing in preparation for it is to do a screen of the value stocks. Then do a CNAV of those companies and wait for the price to drop below the CNAV before buying it. You can find the criteria I am using for searching value stock here.
On a side …

My Mom CPF account updates

Image
This post is an update of my Mom CPF account after my hack on topping her Retirement Account with my ordinary Account to fund her monthly allowance.

Her CPF retirement account has grown from 20k to 50k during the year 2019. This 30k increase includes Retirement sum top up for tax relief, transfer of my OA to her RA and the $2200 interest she received from CPF end of last year. It is nice to see the government help fund my Mom allowance.

With this amount in her RA, I believe her monthly payout had increased from $250 for about 10 years to $370 per month for 17 years. I am intending to continue topping up her account up with my OA till she is 70 to earn more interest from the government before requesting for her retirement sum scheme payout. With this, it should greatly reduce the cash I need for her allowance 2 years down the road when my Mom turns 70.

The cash saved would then go into funding my Special Account top up for tax relief. A triple win I think. What do you say? 

Happy Value Inv…