An article in the newspapers on one person's goal to have $1m in his CPF account by age 65 generated quite a bit of interest.
I commented on my FB wall that not everyone has the financial ability to do what the person does but it shouldn't stop us from trying. Even if we should just do a fraction of what he does, I am sure we will be financially more secure in future.
After reading the article, I decided to estimate what I might have in my CPF account by age 65.
The estimate will ignore the effect of the extra 1% interest on first $60K of our CPF savings as well as the additional 1% interest on the first $30K once we reach 55 years of age. Of course, I am also ignoring the possibility that interest rates for our savings in the CPF could change in future.
My CPF accounts at the end of 2015:
Assuming that I stop contributing to my CPF account from 2016, I should have at age 65:
Total by age 65: $1.2m
Although I will no longer have mandatory contributions to my CPF, I intend to max out the CPF annual contribution cap for members by doing voluntary contributions annually, in the process maintaining a meaningful percentage of investment grade sovereign bonds in my investment portfolio.
So, I would probably end up with more than $1.2m in my CPF accounts by age 65, all else remaining equal.
I am making good use of the CPF to form a cornerstone in my retirement funding strategy. This safety net gives me peace of mind.
If AK can do it, so can you!
1. Use CPF savings or cash to pay?
2. How to upsize $100K to $225K?
3. A cornerstone in retirement funding.
Read newspaper article: here.