Late showing off CPF OA, SA and MA in 2018.

Reader says...

Thanks for sharing your CPF details but those are for 2017.

I looked for your 2018 numbers but without success.

Could you show me the link?

I am a new believer and it is all thanks to your blog!

AK says...

I thought I shared but I can't find the blog.

Aiyoh, if AK cannot navigate ASSI, no one can. :p

So, here are the numbers:

If you are comparing the numbers with those from 2017 (here), please note that I did a voluntary contribution in January 2018, maxing the annual CPF contribution limit.

This is why the OA has crossed the half million dollars mark.

I intend to continue making voluntary contributions yearly till I turn 55 as I build a bigger position in dollar terms in an investment grade sovereign bond, our country's very own.






I will have the option to withdraw some, most or all of the money in my OA when I turn 55 since my SA has already exceeded the prevailing Full Retirement Sum (FRS).


And I expect the SA to exceed the FRS year after year if the SA continues to earn a minimum interest of 4% a year while the FRS grows at 3% a year.






In such a case, although I probably won't do it, I would also have the option of withdrawing money from the SA when I turn 55.

Of course, when I turn 55, there will be a newly created RA where the FRS will be housed and CPF Life will start paying me a monthly income for life when I turn 65.

CPF Life will automatically start paying out when we reach age 70 if we do not wish for payouts to start earlier.







Here are the links to the two other blogs on my CPF in 2018 which I could find:

1. CPF savings grew almost $200K!

2. CPF interest earned (end 2017).

If AK can do it, so can you!

Investing or speculating in real estate?

Reader says...
My friend bought 2 units private condo (District 9-10) last year and early of this year.

One for own use and one for investment purposes (still vacant as at to-date).






As recently all banks increase the loan interest.

Thus, I asked him whether it is stressful to service the two condos.

He told me...

AIM FOR THE CAPITAL GAIN. WHY WORRY IF YOU KNOW THAT YOU CAN MAKE 300K IN THREE YEARS TIME?






Any idea whether Singapore property sure will increase price?

See so many en bloc recently, I believe developer here won't anyhow dump their money.

Isn't it?

AK says...

Your friend knows for sure his recent D9 purchase can make $300K three years from now?

After all the costs that comes from holding it vacant for three years?

Power!

He probably knows something I don't.





As for property developers, they have tons more money than we have and they probably have easier access to credit than us too.

When we owe a few hundred thousand dollars to the banks, we are at their mercy but when we owe  hundreds of million of dollars to the banks, they are at our mercy.

If things should go downhill from here, (most) property developers probably can weather the storm but can we?

It is only too easy to feel invincible during good times but we should stress test our finances to see if we are really invincible or is it all in our mind?





I know some people think I am against property speculation but, really, I am not.

It isn't something I would do but I am not against other people doing it.

As long as the people who do it know that they are speculating and if they have more than sufficient ability to do so, go ahead.

The problem I have is with people who

1. are speculating but think that they are investing

and

2. are really not financially strong but have only enough spare cash to follow the herd.

Anecdotal evidence shows that these people are more common than not.





Those who expect property prices to double in the next 10 years like it did from the Global Financial Crisis a decade ago are more likely than not going to be disappointed.

We should not let the fear of losing out force us into following the herd.

Ask what are we really losing out on anyway?

What do we gain by doing this?

What do we lose by not doing it?








My experience has been that if we buy a property that is a decent investment (see related posts at the end of this blog), its value will likely hold and over time it could enjoy capital gains.

Of course, it is never my way or the highway.

I just don't have much confidence in my power in speculation.





A blog published earlier today:
Condo investment has been a drag.


My own experience:
1. Property investment philosophy.
2. Affordability and value for money.