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Too little passive income and too much money in CPF OA.

Friday, January 6, 2023

It is probably no secret that AK is pretty reclusive.

The COVID 19 pandemic has made AK even more reclusive, if that is at all possible.

Why so reclusive?

Well, I think a lot and some people would say I think too much.

Better be safe and not sorry, especially when I have aged parents whom I visit weekly.

Almost without exception, I would have a sleepless night after any form of social engagement as my monkey brain would replay the event again and again.

In the worst case scenario, I would get an anxiety attack.

Some people think that I was kidding when I revealed I was a patient at the little house on Buangkok Green.

I wasn't.

To be fair, it was probably just a contributory factor that led to my diagnosis and treatment at IMH.

As my blog got more popular and the blogger got more attention, there was a growing feeling of anxiety.

So, it was a good thing that Facebook did what it did to me and I took that as an opportunity to scale back on social media engagement.

Blogging is a hobby and hobbies should be something we do because they make us happy and not because they make us anxious.

I cannot remember who the people were by now but there were those who were pretty unkind.

They told me that if I could not take the heat, I should not be in the kitchen.

Then, there were those who were kinder.

They told me I should learn how to break and blog or I could suffer a burnout.

Well, both groups of people were right although their messages were "same same but different."

I am glad that I have reduced my social activity as a blogger in recent years and have confined myself to my blog.

The only way most people can get in touch with me now is through the blog's comments section and only if they have a Google account.

I know it is very restrictive but it is good for my mental health.

Yes, it is not just because AK is lazy which is what I always say.

This way, I rarely have to deal with trolls and bots.

I know I am missing out on new business opportunities too as an "influencer" but it doesn't really matter to me.

I am glad that I did what I did as I enjoyed blogging from the moment I started in 2009 and I want to continue blogging because I enjoy it.

Of course, I know that "a big tree catches the wind."

Talking to myself, if I have managed to inspire readers to achieve financial freedom, I am glad.

That is what I always say and that is primarily what I want my blog to do.

To inspire.

Although I do not like it, I cannot deny that my blog attracts some attention of the unwanted variety.

I try not to be like the proverbial blind men who each touched a different part of an elephant and gave their conclusions without the full picture.

Although I am uncomfortable with revealing or explaining everything about me, I make an effort to share enough information for readers to make their own informed decisions on stuff that I do blog about.

It isn't unreasonable because the really interested readers would read my past blogs for background information especially when I make an effort to provide hyperlinks to related blogs.

Despite keeping a low profile, I was made aware of two statements recently.

1. My passive income is growing too slowly.

2. I have too much money in my CPF OA.

I have watered down the statements which were somewhat offensive in their original forms.

Although I initially thought there was no need for me to respond to these statements, a good friend said I should.

To be honest, I don't want to do it but after some thinking, I think I should. 


It is only fair to readers especially those who have not been following my blog for very long to have me throw light on the matter.

After all, I cannot assume that my blog only has regular readers who have been following my blog for many years. 

They would probably have an idea how I would respond to both statements.

So, now you know the reason why I am crafting this blog.

I am going to get this over with chop chop.

My passive income has not been growing very much in the last few years as I retired a few months before I turned 45 years old and that was about 6 and a half years ago.

Since then, I have lacked an earned income.

So, although I could invest a big portion of my earned income and all my passive income when I was gainfully employed, I could not do so in recent years.

If we go back 11 years, my passive income was about $100K a year back then but it was $200K for the whole of last year.

Also, 11 years ago, my investment portfolio was very heavy in REITs and enjoyed very high yields which isn't the case today.

As for the money in my CPF OA, I do not think getting a risk free 2.5% per annum return from a volatility free instrument per se was a bad thing.

It looks like it is a bad thing now because interest rate has risen so much in less than one year.

So, what seemed like a good idea in the past does not seem like a good idea now.

Of course, there were people who did not think that having a lot of money in the CPF OA was a good idea in the past as well.

The proverbial blind men each touching a different part of an elephant comes to mind.

As a retiree who lacks an earned income and at my age, it is not a good idea to be too adventurous when it comes to investing my money.

I am aware that I could have invested some of my CPF OA money in equities for higher returns but do I need to do it?

I don't think so as it is probably quite obvious that I already have a substantial exposure to equities.

I also do not want to do it because I want to grow my portfolio's exposure to fixed income which would reduce volatility in the portfolio.

Also, most investors who used their CPF money to invest would have been better off leaving their money in their CPF OA and it could have been the same for me too.

I am not infallible.

For a person in my position, why trade something that is risk free and volatility free for something that is not for a possibly higher return?

"It’s insane to risk what you have for something you don’t need." Warren Buffett

What to do?

What I am considering doing is to use CPF OA money to get T-bills.

However, as I am mental and want to avoid visiting the bank if I can help it, I am waiting for online application to be allowed.

However, if T-bills should see yield climb much higher before then, I might make a trip to the bank, no matter how reluctant I am to do it.

Right now, not getting $700K of CPF OA money into a 6 months T-bill means losing some $10K in annual passive income.

What I am going to say next might be taken the wrong way by some people but, to be quite blunt, to me, it isn't a big deal.

I have not put in much effort in crafting this blog. 

I just typed whatever came to mind.

So, I apologize if it is not as diplomatic as it should be.

I just want to get it out of the way so that I can enjoy Genshin Impact's special program which is starting soon.

Don't want to have this at the back of my mind.

If you play Genshin Impact too, don't forget the free Primogems from the special program.

Good luck and have fun.

Recently published:
1. 2022 passive income.
2. More than $1.1m in CPF.


Rellangis said...

Huh ? Where did you read those statements from ?

If you have not posted this, I probably would not know too.

Anyway, there will always be trolls online. Just ignore them and continue to do your work.

PG said...

this is my first time commenting on your blogs after so many years.
I feel this time I should at least give an opinion and response to you as to validate what you have been doing is a worthy right thing.

First, I would like to thank you for your generous sharing of your knowledge and point of views. I really learnt a lot from reading your blogs and hope this msg can serve as an encouragement for you to keep doing what you like.

You are a really fine and good human being. Your stories and sharings made us believe that a normal rat racing person can also achieve financial independent life. Though we cannot please everybody in this world, but pls remember there will always be people who support you and I believe this is what should really matter to us and worth to focus on.

Lastly, please take good care of yourself. keep going and hopefully we can meet and be friends one day when fate permits.
p/s: this is a personal reply, so no need to post my blog :)

Small steps said...

Hi AK,

Not sure what trigger this post but hey - relax lah !

You are doing good and ignore the haters ! Appreciate your sharing and i always ask people to read your blog. Think it is fair view and you do give good inputs for anyone wanting to be financial free ! And you have a silent majority of readers who think well of you !

C game

Selenite said...

Dear Mr AK

I have learnt quite a lot from your blog.

Have sorted out my insurances - critical illness, term life, hospitalization, endowment plans (bought before I read your blog) and CareShield Life supplement plan.

Bought a multipay CI plan for 7 months, but I cancelled it. Figured out that 长痛不如短痛。So long as I am employed, I can tap on my company's medical insurance. During the early stages, I should be able to continue working. Learnt that from you, Mr AK, 谢谢你。

I don't earn much. Only $4500. And I am 33 this year. Forgot to mention I am a female. Before August 2019 I was earning only $2600. I was in a comfort zone for too long. Afraid to change job, believing my worth was only that much. 怕找不到更好的工作。怕遇不到更好的同事。My job was simple too - just applying certificates, issuing crew contracts. 也就因为这样, 我就跟自己说, 这么容易的工作,公司肯付你 $2600 就要偷笑了。But a 29 years old degree holder earning $2600 was quite pathetic, when your friends were all earning $4k plus. I studied so hard, spent close to $30k to get a degree, only to be satisfied with $2600? Came across your blog post on how to increase income - upgrade yourself, believe in what is your worth, negotiate for higher pay, change job. 对啊, 与其抱怨, 不如采取行动? 连我都不肯帮自己, 谁还会帮我? Hence I changed job in August 2019. In 2020, at the height of the COVID pandemic, I seized the opportunity to upgrade myself when the govt increased their course funding to 90%. After I got the professional qualification in 2021, I changed job again. 24/7 job, tiring, but satisfying. Upgrade myself, believe in what I am worth, negotiate for higher pay, change job. 谢谢你,Mr AK.

You also mentioned the importance of emergency fund. Thus I started saving. Saved up 1 year of emergency fund. The CPF posts have proven to us the power of compounding. Hence, I would transfer the money from OA to SA yearly. 今年开始我不会再 transfer了, cause I need to purchase a flat when I am 35. 

I wear hand-me-downs from my sisters and friends. I change my phone only when it has spoilt and it is not worth to get it repaired. Once or twice a month, I would dine out with friends, spending around $20-$30 each time. Twice a month, I would bring my parents out for a good meal, spending $10-$50 each time. $100 is rare, maybe twice per year. I spent a lot on travel. Before I read your blogs, I only saved to travel. 因为小的时候很穷, 没钱出国。Hence when I started travelling when I was 23, I could never forget the liberation I felt. Since then, I would travel at least once per year. So long as my bank would have minimum $7000 remaining after deducting the travel budget, I would travel. 所以,  Mr AK, 谢谢你, reading your blogs have changed how I manage my money. 至少现在, I have saved the emergency fund and have more than $7000 in my bank, haha.

I have been using my cash on hand to invest, not monthly, perhaps every two months or so... My short-term goal is to buy a two-room flat when I am 35. Long-term goal is to shorten the years I have to worry about money, which is probably the goal of the average person. Medium-term goal is to hit the basic healthcare sum, then the full retirement sum.

Thank you for your time. Trying to tell you, the difference you have made in someone's life. 谢谢你。

Best Regards

AK71 said...

Hi Rellangis,

Yikes! Work?

If blogging is work, I won't do it anymore. ;p

For many years now, I have been too lazy to read other blogs and even lazier to read online forums.

Usually, people would tell me what they have read and that's when I might take a look for myself.

For example:
AK responds to HWZ forum.

I thought of ignoring the statements too as they don't affect me.

However, after some thought, I decided that I should try to provide greater clarity for the benefit my readers, especially the newer ones.

I welcome readers who genuinely wish to know more to comment here and I will share what I feel comfortable sharing. :)

AK71 said...

Hi PG,

I only read the first few lines of you comment in the moderation window and hit "publish" as it was enough for me to determine it was not spam.

It was only after publishing that I read your last line.

As your comment does not contain any personal or sensitive information, I hope you don't mind having it published.

Please accept my apology. -.-"

Thank you very much for your words of encouragement.

I am glad that talking to myself has inspired and helped you.

For sure, there are many legal and ethical ways to achieve financial freedom.

My way is just one of the many ways.

So, I always say that is never my way or the highway.

We should always have a plan, our own plan. :)

AK71 said...

Hi Small steps,

Oh, I know ASSI has many readers. :)

I also know that many readers ask their friends and family members to read my blog.

This is a strong reason why I feel the need to publish this blog. :)

Long time readers of my blog would understand why I do the things I do.

However, the newer readers might be somewhat mystified.

Although I try my best to clarify, often, my blogs can feel like casual chit chat with old friends and the oldest friend I have here is myself. ;p

Anyway, thanks for being concerned but I am not triggered or I wouldn't have thought of ignoring the statements.

This blog is really for the benefit of newer readers of ASSI.

I don't know if it is something they would appreciate but that is not something I can control. :)

AK71 said...

Hi LM,

Thank you for sharing in such great detail how my blog has been helpful to you.

My eyes were tearing.

Well, just a bit.

Really, really thank you for letting me know. :)

This is the best reward I can have as a personal finance blogger. :D

I remember some of the blogs you mentioned and I am placing hyperlinks here in case other readers are interested:

1. Do you make enough money and are your paid fairly?
2. Is early critical illness insurance necessary?
3. How to upsize $100K to $225K in 20 years?
4. How much should we have in our emergency fund.

Again, thank you for letting me know.

I am going to bed with a smile on my face. :)

Wishing you every success and abundant joy in 2023.

Gambatte! :D

Yv said...


I've learnt not to bother with criticisms and comments from those I wouldn't seek advice from. Don't let those keyboard warriors get you down.

I am a relatively new reader to your blog and have enjoyed reading your frank opinions. There's no need for you to validate or account to your readers why your passive income has dropped or why you chose not to touch your OA. It's your own blog and your own decisions so heck, you can do whatever you like that make sense to you.

Keep on writing.

Hello said...

Hi AK,

Thank you once again for your generous sharing.

Do constantly remind yourself that you have done plenty of good sharing your wisdom with many and have benefited many people.

Also perhaps we are meant to be social beings maybe you can consider expanding your social interactions with a close group of friends. I think that really helps as well.

It's tough receiving these negative messages and I hope your find strength to overcome your anxieties.

You do you man! Don't care what the haters say haters are always going to hate. No point responding to them.

Anyway all the best in 2023 and remember you have made plenty of positive impact by your generous sharing!

Keeping you and your family in prayer!

God bless!

garudadri said...

Dear AK
Mature investors understand the importance of both age and stage of lives with regard to investment style, asset allocation and timeframes. Certainly you are one and a successful one too. Most important thing is to have peace of mind and if that is at the cost of potentially avoiding riskier alternatives, that is the way forward
Unfortunately, many do not understand these concepts and indulge in very high risky “investments” and repent in leisure. I do confess that I get swayed from time to time and speculate for higher dividends or yields and have been stung badly. However not only have I always kept such speculative positions under 5% maximum but also am constantly trying to learn from those hits to get this further down
As I am still working with big family commitments, I have done this. From time to time, it makes sense to review asset allocation and move gains with some capital off the equity side into either fixed income or property ( if you want potential growth, at the cost of liquidity of course)
Even this strategy, as we saw this year with both global equity and bonds falling, is not fool proof. In this context, your conservatism is perfectly the right thing for a retiree like you
Lastly, I must say that you have been selfless in blogging and conveying the “right messages” and more importantly, you have done this in a consistent fashion
Alas, the great majority of investors have neither the temperament nor the patience , to put your guidance to good use
Warm regards and best wishes

AK71 said...

Hi Yv,

Good to hear from a relatively new but very active reader. ;)

Appreciate your advice and encouragement.

I have been the subject of scrutiny as a blogger many times before and in the beginning, it was hard.

Imagine picking up gardening as a hobby and all your neighbors telling you how inefficient you were as a gardener.

Hard to imagine, right?

Of course, if you were a commercial farmer, that's something else.

Scrutiny only happens at work or so I thought.

Blogging is a hobby to me and not work or at least that is what I think.

If it is work, then, I should quit because it pays me poorly. ;p

After so many episodes in the past, I have become a lot more ZEN about such things.

I respond to critics because I feel a sense of responsibility to readers although I keep saying I am just talking to myself and readers are eavesdropping at their own risk.

Having said that, I am no saint but I try to do what I feel is right.

Thanks again for the kind words. :)

AK71 said...

Hi Hello,

I am not a very religious person.

So, I appreciate your kindness in keeping me and my family in your prayers.

Thank you very much. :)

To be honest, the friends I have now might not even be enough to form a circle around me. ;p

Expand the circle?

Thinking about that is giving me an anxiety attack. -.-"

Told you AK is mental.

I enjoy my own company and I am most comfortable when I am alone.

Still, I know what you say is true and I will bear it in mind.

Thanks again for the advice and encouragement. :D

Busybody said...


Haters are poisonous losers who are jealous of you
(getting out of rat race retiring early in life)

They never open their books while talk is FREE
To each his own so don't even bother to engage them

Just delete/purge or flush those comments down the toilet

By looking at that few unconstructive negative comments will suck the soul out of you
Wasting minutes of your life (vs the silent majority supporters)

Just relax & chill

Happy Lunar New Year to you & your loved ones

Huat Ah

AK71 said...

Hi Busybody,

I always like considering different points of view.

For sure, I don't know everything there is to know.

For example, T-bills are a relatively new addition to my portfolio.

I only got more familiar with them when their yields rose significantly.

Decided to learn more about them. :)

However, I don't like it when people are rude or plain insensitive as they shove their opinions in our faces.

Your comment reminds me of a blog:
Financially free AK should be ashamed.

Thank you for your encouragement. :)

Wishing you a happy CNY and huat ah! :D

klsr98 said...

Hi AK,

Just wanted to reaffirm that your sharing has been a blessing to many, including myself and my family.

Everyone has different risk appetites and varying financial goals at different seasons of their lives.

For my age and risk profile, your sharing has fitted well with us. We have benefitted by building our own passive income streams with better risk awareness.

The critics likely form a tip of the iceberg where so many others have benefited from your selfless sharing.

I look forward to continue learning from you as I continue to age and provide safety nets for my family!


AK71 said...

Hi klsr98,

I am very happy to learn that talking to myself has been helpful to you and your family. :D

Although we might all be working towards financial freedom, we have our own circumstances to consider.

It is about finding that bowl of porridge with the right temperature to suit our individual taste. ;)

The "critics" are quite possibly high flyers or perfectionists and I am neither. -.-"

I will just keep plodding along.

Slow but steady, I hope. :)

Thank you so much for the encouragement. :D

zhenling said...

Hi AK,

long time silent reader here. I decided it's time to write a thank you for your blog, sharing your personal financial journey here. Hearing you talk to yourself about cpf and your warchest made me comfortable with being conservative in my own personal finances. and on hindsight, with high-risk moves in my career paying off(and suffering the stress), I am thankful that I had peace of mind of a large cash reserve. Sure, I could have made more money deploying the money, but I'm not so sure I would have survived the mental health crisis.

I find it helpful to hear how you are doing as a retiree in an inflationary environment. I'm glad you are doing well, it really lends a lot of credibility to the FIRE movement. Recently I've been more motivated to work on my own FIRE journey seeing your success.

trolls are likely just jealous of your achievements. They'd be better off directly their energies away from negativity into their own self-improvement. My mental image of trolls is that of noisy chihuahuas constantly barking to over-compensate for their small size.

I hope to learn from you more in future :) happy CNY

Chenheyuan87 said...

hi ak, happy new year! what do you think abt owning 100% reits portfolio and dca for next 20years for a 30s adult .. assuming CPF already hit FRS ..

AK71 said...

Hi zhenling,

Always good to hear from long time silent readers. :D

Although I always say that I am just talking to myself here, it is good to know that it isn't (always) true and that maybe I am not as mental as I thought. ;p

Your comment reminds me of a blog where I said that for some people, they only have to be good savers in order to achieve financial freedom.

Whether we make $1m a year or $100K a year, it all boils down to what kind of lifestyle we have and how much money is needed to sustain it.

How to have a comfortable retirement?

Even people with children can F.I.R.E. :)

How to have children and a comfortable retirement?

Building financial buffers will allow us to F.I.R.E. with confidence.

I have always found the various variants of F.I.R.E. somewhat amusing because some variants of F.I.R.E. could be easily put out in periods of high inflation or bad recession.

To be fair, not all trolls are bad trolls.

Sometimes, it is not what they say but how they say it.

Thank you for breaking silence and the encouragement.

Happy CNY! :D

AK71 said...

Hi Chenheyuan87,

Once upon a time, my investment portfolio was very heavy in REITs.

Very low interest rates in the last 15 years made investing in real estate very rewarding and REITs were natural beneficiaries.

That is no longer the case.

Although REITs are still relevant to the investor for income, having only REITs in an investment portfolio goes against my idea of a more resilient portfolio, whatever the investor's age might be.

I don't know if you have read my recent blog on my effort in building a more resilient portfolio:
4Q 2022 passive income: More resilient portfolio.

To be fair, I do not know what the next 20 years are going to be like.

So, you do you.

Happy New Year! :)

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