Tea with EY: Get a lifetime income of >$2K a month.

I am very pleased to publish another thoughtful guest blog by EY. If you are concerned about retirement funding adequacy and if you wonder how it could be achieved in a risk free manner, you should read this:

What can we learn from squirrels?

A big part of my retirement planning revolves around optimising my CPF-SA to generate at least $2,000 of monthly cash flow at 65 years old. With this in mind, I set the target at 32 years old to meet the CPF Minimum Sum by 40.

I hit 40 more than a week ago and have managed to accumulate $161,671.23 in my CPF-SA which coincides with the CPF Minimum Sum of $161,000 effective 1 Jul 2015.

Assuming that I continue to contribute $4,800 (based on approx. 14 months of income) to CPF-SA till 55 years old, my CPF-SA balance would grow to $391,833 by then.

In 15 years’ time at 55, I would expect the CPF Minimum Sum to be adjusted to $200,000. After setting aside this amount in the CPF-RA account to participate in the CPF LIFE plan, I would have $191,833 left in my CPF-SA.

If I stop contributing to my CPF-SA at 55 years old and leave the balance to earn 4% interest, my CPF-SA would have grown to $285,991 at 65 years old.

At 4% interest, I could collect $11,652 per year or $971 per month, without touching the principal amount.

For the CPF-LIFE plan, I intend to participate in CPF LIFE Basic which allows me to leave a larger bequest for my family. With $200,000 in RA at 55 years old, the monthly payout at the draw down age (DDA), currently at 65, is $1,316 - $1,467.

This would mean I would have a life time monthly income of $2,287 - $2,438 each month.

When I kick the bucket, my family will receive the following bequest:

Now, the pertinent question – ‘Would $2,000+ of income a month be sufficient to meet my retirement needs in 25 years’ time?

I don’t know. Really. What I do know is not putting all my humpty dumpties in one basket. Besides this fixed income plan, I will be actively building up other income sources.

Related posts:
1. Level 1 financial security for Singaporeans.
2. The best insurance to have in life (is passive income).
3. Millionaire or not, plan early for retirement.

Get a 75% price discount on a smoked turkey sandwich!

I really like having smoked turkey breast sandwiches but they are usually quite pricey.

Whenever I am in the supermarket, I would check out the cold cuts and see if there are some special offer items. If we don't mind eating stuff which are expiring in 2 or 3 days, we can usually get rather good deals. For example,

Eat by 25 Dec 14, Christmas Day!

Half price! What a deal!

Of course, it was not the first time I bought this product at half price from Cold Storage supermarkets. Just trying to create an air of excitement here. Yeah!

This brand has a good selection of cold cuts but I like the smoked turkey breast the most. I like to think that it is the healthiest option there is. See?

99% fat free and has the healthier lifestyle stamp!

Anyway, this is about 200 grams of turkey and is enough for me to make 4 sandwiches, each with 2 slices of meat.

If you are interested, here is the list of ingredients to make the sandwiches with:

1. 200 grams of smoked turkey breast. $4.75.
2. 8 slices of Gardenia wholemeal bread. $1.65.
3. A small cucumber. About $0.40.
4. 4 slices of cheese. About $0.80.
5. Some trans fat free margarine. $?.??.

Packed and ready to go!

Each gourmet sandwich would cost less than $2.00 to make but you would have to be like me and not mind having the same thing for breakfast and lunch. However, if you are making breakfast or lunch for the whole family, this is not an issue.

Biting into my lunch!

We can have "atas" food without the "atas" prices.

Related post:
Gourmet sandwich by AK Deli.