Dividend Machines Are Crucial As CPF SA Closes.

Been a while since my last blog post.

I have been busy with many things at home and I have not been looking at the stock market.

The last time I did anything in the stock market was in December last year when I bought some shares of Alibaba and Wilmar.

Fortunately, my investment portfolio is on "auto mode."

More or less.

It doesn't require constant attention from me.

It simply generates passive income for me regularly and all I have to do is to check my bank account on a monthly basis to see how much I have been paid.

This is still something I have to do since I don't want to overspend and I have to allocate excess capital.

In recent weeks, when it comes to excess capital, all I did was to maintain my T-bill ladder and this was something I have produced blogs and videos on.

T-bills are still a good place to park excess cash for now as I wait for better investment opportunities in the stock market.

Interest rates are likely to stay higher for longer as the Fed is no longer as interested in cutting rates as they were in the second half of last year.

This is of course good news for my relatively large position in DBS, OCBC and UOB.

All three banks are likely to continue paying meaningful dividends and they could pay more in 2025.

This is because they have plenty of excess capital.

Having said this, it is important to mention that I am not always flushed with excess capital.

There will be months when I don't receive any dividend or very little.

First and fourth quarters are usually drier.

January usually sees a drought!

I received zero dividend in January 2025!

However, my investment portfolio still generated 42% higher passive income in January, year on year.

This is all thanks to T-bills and Singapore Savings Bonds.

Fixed income.

I have been stashing more money in T-bills and SSBs.

To be sure, the passive income in dollar terms is not mind blowing.

January 2025: $1,491.93

January 2024: $1,046.20

It is an increase of some $450.

Enough to cover some of my routine expenses.

Of course, if I had mainly relied on something like this over the years, I would not have what I have today financially.

This is just part of my financial pyramid and it contributes to my portfolio's stability.

Of course, regular readers also know that I like the CPF system very much but with the CPF SA going away once we turn 55 years of age, we have to be less reliant on the CPF to fund our retirement.

Investing in the stock market is still something that every regular person should seriously consider in order to have a more comfortable retirement.

How to get it right most of the time?

I have shared my methods and philosophy here in my blog over the years and more recently in my YouTube channel.

Some have asked me if I could conduct investment courses but, of course, readers who have been following me for many years would know my answer to that.

However, it is that time of the year again and for anyone who is interested to learn how to invest for income, "Dividend Machines" is open for registration again.

"Dividend Machines" is the only course I have promoted yearly since its founding so many years ago.

It is not only well structured, it is also well priced and does not cost thousands of dollars.

It is run by my friends at The Fifth Person and some of you interacted with Victor who was the guest speaker during "Evening With AK And Friends 2025."

Anyway, if you are interested in growing streams of passive income and you should be, have a look:

Dividend Machines 2025.

If AK can do it, so can you!

$300K invested in REITs? Why did I buy? How was I sure?

I spend a lot of time thinking.

Some say I am a thoughtful person.

However, some say I think too much.

We are all wired differently, right?

During "Evening With AK And Friends 2025," something that kept popping up could be explained as such.

I said having money to invest with was not enough.

We must have the right mindset and the right framework for what we want to achieve financially.

Our methods and our motivation must match.

So, I shared the pyramid which I use to help ensure portfolio stability, and at the very least make sure it does not sink to the bottom of the ocean and is lost forever.

Having the right mindset is also very important.

Being prudent with money is the first and most important step as we need capital to invest with.

Being patient and pragmatic is useless if we don't have the capital to begin with.

Patiently waiting for opportunities.

Being pragmatic to know how much we should be investing in something.

Someone asked what gave me the courage and conviction to buy into REITs big time during the GFC.

I remember in reply to another question, I said we must know what we are buying.

If we didn't know what we were buying, then, we wouldn't know if we should buy more or if we should sell.

We could panic and sell when the price plunged instead of buying more, for example.

I used the example of Saizen REIT and said I was sure their portfolio of assets was worth more and that there was a strong demand for them.

When they sold some of the buildings to pay down debt as required by their lenders then, they were able to sell them at a big premium to book value.

Mr. Market was feeling very pessimistic about the REIT and turned a blind eye to that.

The GFC was really a credit crisis.

Some REITs like AA REIT could not get their hands on loans.

In the case of AA REIT, a white knight came along to recapitalize the REIT. 

It was controversial and very ugly but it was the only practical way for the REIT to survive.

The white knight was not altruistic, for sure.

It was all about making money and with so much money involved, they would try to make sure the REIT delivered.

So, what did I do?

I got on the boat with them.

Be pragmatic.

I also mentioned Lippo REIT during the event and how I was able to get a 25% distribution yield back then.

Indonesia was one of the very few countries that did not go into a recession during the GFC and the Rupiah was relatively strong then.

Indonesia didn't rely on external trade much.

Their domestic economy was 60% of their economy if I remember correctly.

The country's urban population still went to malls and they didn't have as many big malls back then.

The malls weren't going to shut down with demand that high.

With a 25% yield, I would have gotten back my money in 4 years.

Of course, some older readers might remember I sold more than half of my investment later for a 200% capital gain when Mr Market recovered from its depression.

That was the one year I blogged about massive capital gains from investments on top of passive income.

Be pragmatic.

I also said that I had the benefit of advice from a senior investor in real estate who said to be brave.

He said the market was behaving as if the buildings were being abandoned.

Still, we must do our own research to verify which I did.

Be brave but don't be foolish.

Don't borrow money to invest with.

Silly to risk what we need for what we don't need.

Don't follow "gurus" blindly.

Don't ask barbers if we need a haircut.

Educate ourselves and trust ourselves more.

We cannot get it right all the time, for sure.

However, if we are right most of the time, we should do well enough.

In the 15 years after the GFC, people got used to low interest rates.

REITs got used to that too and many borrowed too much and were way too optimistic.

We want to avoid being too optimistic and being too pessimistic.

Be pragmatic.

When some were saying buy Suntec REIT, I produced a video on Suntec REIT on how much it has changed from the time I invested in it donkey years ago.

Therefore, contrary to what those influencers said, I said I wouldn't buy Suntec REIT.

A few years back, so many influencers were saying buy Eagle Hospitality Trust and I produced a series of blog posts on why I wouldn't touch it.

Do our own research.

Someone in the audience said my blog was hard to read and he preferred my videos.

I think the truth is more and more people don't like to read.

Maybe, this is why in a recent international study, Singaporeans scored so badly in composition and comprehension in the years after leaving formal education.

Outsourcing isn't always a good idea especially when it affects our personal development.

We can listen to what YouTubers have to say but don't start relying on them for directions.

Alamak.

Nagging again.

Primary objective of this blog is to better answer a question posed during the event.

As I grow older, my brain dulls.

It takes more time for me to recall all things I want to recall in reply to some questions.

It is quite sad when I think of how I was sharper and more articulate before.

The nagging just happened unintentionally.

If AK can do it, so can you. 💯