Go hit CPF MS or FRS by age 40!

Reader says...

I am currently 37 years old. 

I am working towards the target of hitting my CPF mininum sum by the age of 40.

The current balance in my SA is about 80k. 

My OA account balance is zero as I have transferred all my OA to my SA account. 

I have already hit the max limit for my MA of 52k. 

After reading your blog, I top up at the start of the year to receive free $88 ang pow. :)

I have fully repay my 4 room HDB loan and me and my wife have more then 6 months of emergency funds. 

Me and my wife has no other loans or liabilities.

I am thinking of contributing a lump sum cash contribution of 30k into my CPF SA so that the base amount is bigger and compounding at 4% a year means I can probably reach the minimum sum of 181k when I am 40. 

After that I just let time be my friend and let it do the compounding magic.

I am currently still working as well so I will have CPF contribution as well.

Do you think this is a good idea? 

I do understand that only up to 7k of cash contribution is entitled to tax relief.

Thanks for your help and looking to hear from you.

AK says...

It would depend on whether that tax relief from doing Minimum Sum Top Up (MSTU) is important to you. 

If it is, limit yourself to a MSTU of $7K a year. 

This is especially pertinent if you happen to be a high income earner. ;)







Related posts:
1. VC to MA and get a $88 ang bao.
2. $1.2 million in CPF by age 65?

What do you need as an investor?

This conversation took place when IREIT Global's unit price declined to 71.5c after going XD not too long ago.

AK bought more.




And this was another conversation with another reader at around the same time, maybe, about 2 days apart:

Reader:
Hi AK, I'm on of your readers. I'd like to know what you think of IREIT Global, which I understand you have in your portfolio. 

Recently, the stock seems to have taken a beating after going ex-dividend. Some days the drop in stock price is on large volume. 

Do you think there's anything to be concerned about, now that there is new management?

Sorry if i contacted you via the wrong channel, couldn't find any email address on your page






AK:
I don't know why the price fell. 😉
I only know that I bought more because lower price means better value for me.

Reader:
Ok thanks, that's reassuring coming from you 🙂

AK:
Oh, I don't mean to reassure you or anything like that.
If you need reassurance from me, cham...
Know what you want. Know if something does the job for you.

See:
http://singaporeanstocksinvestor.blogspot.sg/2017/02/would-ak-invest-in-ireit-global-today.html#comments
Would AK invest in IREIT Global today?




Reader:
Haha no I am planning to hold and not sell. But I find that your judgment is good so just wanted to check with you if there's anything I missed, be it in the results or whatever, that could be cause for concern

So that's what I mean by reassuring, I.e, no specific concerns and no specific reasons for the price decrease

AK:
I dunno everything de
We must accept that we dun hv perfect knowledge
which is why position sizing and war chest are important

See:
http://singaporeanstocksinvestor.blogspot.sg/2015/02/how-to-have-peace-of-mind-as-investor.html
How to have peace of mind as an investor?

Reader:
Yeah that's true. Thanks for the advice 🙂

I only started to take charge of my portfolio one year ago.

So it's good to have someone like you that writes investing advice





AK:
I dun give advice de
BYHW

Reader:
I also invest in US stocks. So far I didn't notice any articles in your blog about US stocks. Do you have any position?

AK:
No lah. I dun have so much money. Singapore market very big for me liao.

Reader:
I'm new to investing so I have a lot to learn

AK:
All in good time. No rush.

So, what do you need as an investor? 

Do you need reassurance or something else?

Related posts:
1. Investor psychology and fear.
2. When to BUY, SELL or HOLD?