Emails on investments and the CPF.

I have been spending more time on a new hobby. Online gaming! 

No, don't worry. It is not of the casino variety. It is a MMORPG. 

What is this? Massively multiplayer online role-playing game. For more information: MMORPG.





The game is "Neverwinter" by Dungeons & Dragons. I am amazed that something like this is available to play free of charge! 

I remember "Diablo" by Blizzard was quite pricey. I waited for the price to come down before buying many years ago.

Anyway, if you get the feeling that I am spending less time blogging, you are right. So many hobbies and so little time. Cham.

It is so realistic but nowhere like SAO (Sword Art Online) of course. I wonder whether SAO's gaming technology would ever become reality.

Can you spot "Neverwinter"?

Reader #1:
Hi AK, I'm your new blog follower since last mth and wanted to ask you what's your advise on an effective approach to investment planning.
I remember you were saying need to have war chest (to take advantage when mkt downturn), emergency funds, investment etc but how do you apportion if let say I have $100k? Thank you.





AK:
Welcome to my blog. 🙂
I dun give advice. I am not allowed to. I am just a blogger talking to myself 😉
Anyway, without knowing your situation well, I can only talk in general.
So, I believe this blog post might interest you:
http://singaporeanstocksinvestor.blogspot.sg/2014/03/graduating-soon-take-steps-towards.html
And this:
http://singaporeanstocksinvestor.blogspot.sg/2015/05/how-much-should-we-have-in-our.html
Watch the video:

"How To Build A Budget?"





Reader #2:
Hi AK, i have been one of your silent reader and have benefited much from your blogs.
Today, i saw that AEM share price has dropped by quite a lot. But i don't understand why
I suspect it may be due to the bonus offer that was exercised today
But i don't understand what does the bonus offer means
And i cant find much info on it as well
Hence, i will like to consult you and learn at the same time





AK:
I am not a consultant. I am just a blogger. 😉
I am not allowed to give advice de. 😞
Anyway, this is the first time I have heard of AEM. Not familiar with this.
Bonus issue?
"Bonus shares are shares distributed by a company to its current shareholders as fully paid shares free of charge."
Source: https://en.wikipedia.org/wiki/Bonus_share






Reader #3:
Hello sir,
Would you advise for
1) OA = 40%
2) SA = 60%
or ????
No need for MA ? Bcos got insurance liao.





AK:
Always need MA. 😉
http://singaporeanstocksinvestor.blogspot.sg/2013/12/how-to-get-free-medical-insurance-in.html
How much you want to put in each CPF account depends on what you want to achieve.
SA is for retirement funding. Cannot be used for anything else. 😉
(Of course, if our CPF-SA were to exceed the FRS by quite a bit when we are 55, we could withdraw a tidy lump sum from our CPF-SA while the FRS goes into our CPF-RA. We could then use the withdrawn money for anything we want.)






Remember, AK is not a consultant. 

AK doesn't give advice. 

AK is just a blogger.

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?