Longevity should be a blessing and not a curse.

"One in two Singaporeans aged 65 today is expected to live beyond 85, and one in three will live beyond 90.

"Tripartite Workgroup on Older Workers to look into whether changes are needed on the retirement age of 62 and re-employment age of up to 67, and if so, when they should be made.

"It will also relook the impact of Central Provident Fund contribution rates on retirement adequacy of older workers."

Read full article: HERE.

Reader says...
"I know one person in Singapore who could not care less about this review. LOL."

Who? Who?

What I want to draw fellow Singaporeans to is the first line of this blog.

What? You speed reading and missed it?

Go see the numbers again.

And what is also important to note is the word "today".

People are living longer and 10 years from now, people aged 65 would probably be living even longer.

Making sure that we have enough to fund our retirement and that we won't be a burden to our family and society at large is a serious matter.





There are still many people who are of the Y.O.L.O. mentality.

"I can afford the Y.O.L.O. lifestyle lah.

"What is your problem, AK?"

Ask yourself if you can afford the lifestyle now AND in the future.





If your future is secure too, then, go ahead.

You shouldn't let AK the miser stop you!

What? You didn't think about the future?

Cham liao lah like that.

Don't play play.





As we live longer, we need to have even more certainty when it comes to funding our golden years because there will be many more of those years to fund.

All of us know that there are those who think that CPF Life is just another way the government is stealing our money.

Regular readers know what AK would say.






1. A lot of the money in my CPF is actually from the government.

See:
A lot of money in my CPF-SA.

2. If you should ever be blessed with longevity and chances are more than 50/50 that you would be, you would be more than happy you had an annuity like CPF Life which pays you a monthly income for as long as you live.

See:
CPF Life Payout Estimator,






Unless we are born with a spoon made of some precious metal in our mouth, when legitimate help is offered, we should take it.

Make longevity a blessing, not a curse.

HAPPY NATIONAL DAY!

See: CPF grew $200K in 3 years!





Related post:
1. How much money can you save?
2. Are we worried about retirement adequacy the right way?

Give up Singapore citizenship to unlock CPF savings!

Aiyoh, why so many rumors?

If we have questions about the CPF, who should we ask?

Don't ask me.

I blur.






Reader says...
Hi AK, recently I chatted with one of my colleagues and he feels that the govt just keep raising the minimum sum and CPF life drawdown age. 

Apparently there is rumour that the CPF life drawdown age will be increase from 65 to 67. 

He is even thinking of migrating to Canada so that we can withdraw his CPF money.

AK says...
Rumour is a rumour. Haha

Good luck to him in Canada. 😉

Reader says...
Actually this is just to let you know how people are feeling about CPF. 

Like forever cannot touch

AK says...
These people will likely forever have not much CPF to touch 😜

Tell your colleague that the CPF Life automatically pays out at age 70 if we do not opt for earlier pay out date.

Hope that doesn't freak him out. 😛


Reader says...
Aiyoh u so bad!





Ya lor. I also say.

Bad AK! Bad AK!

I know Singaporeans who are very dissatisfied with Singapore and everything to do with our country.

They are always complaining about things in Singapore like there is nothing good about our country.

Why not try to make the system work for us instead of thinking that the system is against us?

Could it be that we are against the system instead?

We don't know we had something good until we have lost it.

It is too late then.





Related post:
Government confiscates CPF-MA money when we die!

Survivability and opportunity in times of distress. ("E-book")

Be warned.

This blog could be considered heavy reading, especially on a weekend.

From time to time, I still read or hear people say that an emergency fund is really over rated and that there is no need to have one.

Of course, regular readers know that I disagree with this and that I even have an emergency fund that does not only cover 24 months of my own expenses but my parents' as well (and then some).

Bad things do happen in life and that is what insurance is for but if we buy insurance for all the things we could possibly think of that could go wrong in life, we could go broke.

Yes, buying insurance for everything that could go wrong in life is wrong and I have blogged about this before too.

See Chapter 1:
How insurance weakened a family?






Then, there are those investors who have an emergency fund but do not believe in having a war chest, preferring to stay almost 100% invested all the time.

To me, there are times to be 100% invested but, most of the time, it probably isn't a good idea.

There are many reasons why and one is that those who do not have a war chest might be tempted to use their emergency fund, if they have one, to invest with if Mr. Market goes into a depression.

No! No! A thousand times, no!

I have said before that we should not invest with money we have earmarked for other purposes.

We do not want to be caught in a situation where we have to sell at whatever price Mr. Market offers because we have no choice.

See Chapter 2:
This way to $50K passive income?





Yes, it can happen.

Remember, if Mr. Market goes into a depression, possibly, it is because the real economy is in a bad shape and we might lose the job we depend on to bring home the bacon.

Of course, if you are born with a spoon made of some precious metal in your mouth, please ignore this blog.

See Chapter 3:
My family almost went bankrupt.






The no emergency fund and no war chest camp sometimes say that the option to borrow money is always available.

Of course, regular readers know that I think it is a bad idea to think like this.

The Global Financial Crisis happened 10 years ago but human beings have a short memory.

Still, some of us might remember how difficult it was to borrow money then.

Don't put ourselves in a situation where we have to borrow money.

It is not a good place to be.

See Chapter 4:
Compared to anger, shame is a thousand times worse!

So, is debt a bad thing?

No, that is not what I am saying.

I am saying that depending too much on debt is a bad thing.

Debt is really just a tool.

If we think about it, it is just a tool that magnifies our financial decisions.

If we make good decisions, they will look better with debt.

If we make bad decisions, they will look worse with debt.

See Chapter 5:
Gear up and receive more income?






Debt cuts both ways but it is just a tool.

The danger always lies in human behavior and their feeling of invincibility.

If we keep using debt, we might get drunk on debt and history has shown this to be the case.

Overly dependent on debt, people over extended themselves.

Overly leveraged, when things did not go as planned, they could not repay their debt sufficiently and went bankrupt.

See Chapter 6:
When are we over leveraged?







So, I did not mention the Global Financial Crisis just for fun.

It should be remembered and be used to stress test our finances as the worst possible financial storm that could hit us.

Without an emergency fund and a war chest but, instead, have quite a bit of debt, could we survive or do better in another Global Financial Crisis?

It doesn't matter if we have good or bad debt, debt is debt and this question should be in our base plan.

Do you believe that good debt can go bad quite quickly during hard times?

See Chapter 7:
Don't think and grow rich!







Yes, it is true that there is an opportunity cost in holding an emergency fund and a war chest.

However, having these will improve our survivability and let us capitalise on opportunities in times of distress.

They are self insurance policies.

Opportunity cost?

It really is a small price to pay.

Of course, I have blogged about how having a steady stream of passive income is self insurance too but that is another topic.

See Chapter 8:
Best insurance in life.







No emergency fund and no war chest?

You could be doing yourself a big disservice.

See Epilogue:
How much should you have in an emergency fund?

What is worse than growing old and destitute?

I have blogged about my fear of growing old and destitute many times before.

Indeed, it is this fear that helps shape the person that is AK and not just in terms of money matters.

However, what is worse than growing old and destitute?

Today, I had a chat with a fellow blogger:

FB:
Oh .. I wanted to ask a qn

Suddenly figure out the answwr

Hahahahaha sorry

AK:
LOL





FB:
Was wondering when I buy using CPF, SRS and cash

When I sell, how they know which to sell?

AK:
:o

FB:
Then I realised I put the option

Ya I know I getting stupid hahahahaha

AK:
no lah... growing older is liddat

dementia

cham liao





FB:
I still young at heart

Just old at the mind

How are u getting on

AK:
I am growing old and forgetful like u 😛

FB:
hope to catch u and others at your evening. 

I live by the day,hopefully tickets still available

AK:
I think u missed this blog:

https://singaporeanstocksinvestor.blogspot.com/2018/08/evening-with-ak-and-friends-2018-update.html






Alamak!

So, what is worse than growing old and destitute?

Possibly, being rich and suffering from dementia!

Hey, it might sound funny to some of you but I am serious hor.

OK, at least half serious.





Remember the real story of the rich old lady who was cheated of her money by some tour guide?

At least in that case, her daughter found out and took action.

Or was it her grand-daughter?

Oh, no! I cannot remember.

Anyway, how many similar cases go unnoticed or unreported?





So, what is worse than growing old and destitute?

Maybe it is not being rich and suffering from dementia.

Maybe it is from being rich and suffering from dementia to being old and destitute!

The horror!






Happy Saturday!

Related post (maybe):
CPF is all we need unless we are very rich.

Evening with AK and friends 2018 (UPDATE).

We have doubled the capacity of this year's "Evening with AK and friends" because many readers were left out in the cold last year as tickets were sold out in less than a day!

With so many more tickets available and with the event being 4 months away, I thought the tickets should take a much longer time to sell out this time but this conversation happened about 20 minutes ago.

Kenji says...
10 more tix and it will be sold out if you wanna warn your readers...

AK says...
Alamak. So fast? 

It has only been slightly more than a day (since I announced the event yesterday in the morning) ...

Cham liddat. 

I am bracing myself for complaints from readers who cannot get tickets liao. :(

..

..

..

..

Warning:
As of 20 minutes ago, 10 tickets left.

So, if you are genuinely interested and know what you are getting yourself into, chop chop, go to:

Evening with AK and friends 2018.

You have been warned (again).





-------------


FINAL UPDATE AT 4.30 PM
Sold out in less than 29 hours.

Evening with AK and friends 2018.

Many have been asking when the next "Evening with AK and friends" is going to take place?

Some have been asking since the beginning of the year.

My reply has been that there would definitely be one before the year ends.






Many have asked that the venue be a bigger one because the tickets are always sold out so quickly.

So, this time, we have booked an event hall twice as big as the last one.

This will be the largest "Evening with AK and friends" yet.

Hopefully, it is large enough to satisfy the demand.

Some have even asked if they could book the tickets in advance?

So, ticketing is taking place months before the event date.

Now, if you have been to "Evening with AK and friends" before and want to join us again, you would know what it is all about.

I must say I don't know why some of you attend each and every "Evening with AK and friends".

Don't you think once is enough and twice might already be too much?

OK, I think I have managed to make new readers think twice about joining us.

Yes!

Bad AK! Bad AK!

Now, seriously, "Evening with AK and friends" is simply a chit chat session.

Yes, it is unstructured (and unpredictable) chit chat.

How the evening flows would depend on questions from the audience.

Don't come with any expectations (unless it is one of fun and laughter) and you (probably) won't be disappointed.

Like my friend, Rusmin, said before,

"AK no substance never mind lah, can make us laugh enough already."

You have been warned.








Date:
Fri 23 November 2018


Time:
7:00 PM – 10:00 PM Singapore Time


Venue:
Lifelong Learning Institute
11 Eunos Road 8
Event Hall 1-1/1-2
(Enter from Hall 1-1)
Singapore 40860



Buy tickets: HERE.
(Don't kiasu and buy tickets without first reading this blog post hor. Don't suka suka buy hor. Know what you are buying, remember?)

No food or drink will be provided.

Please have dinner before coming or bring something that you can have during the break.

Consistent with AK's healthier lifestyle and going green, please bring your own drinking water too.





Related post:
Chatting and charting with AK.

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.

This condo investment has also been a drag.

Reader says...

A lot of people like to buy property for investment only.

I don understand.

To get 4% yield is hard on properties





AK says...

I dun understand also. 😛

4% is a dream... 3% (gross yield) is already very good. 😉

And if cannot rent out, it is not 0% but negative because still must maintain. (Vacancy rate is so high now) 😛

Ask these people to buy Martin Modern by Guocoland, OK? 😛

http://www.martinmoderncondo.sg/

(Yes, I know. Bad AK! Bad AK!)







Reader says...
My mom 5 years ago bought a condo on impulse. 

The rental from initial $2,750 drop to current $2,200. 

Still must pay maintenance, property tax, tax on the rental income etc. 

Negative return.





AK says...

Aiyoh. 

Older folks even more so should be more conservative... 😞

(See related post #1 below.)






Related posts:
1. Condo investment is a drag.
2. Buy 2nd property and pay ABSD?
3. Bought multiple properties and...

https://singaporeanstocksinvestor.blogspot.com/2016/05/how-much-money-can-you-save.html

Time is precious and time will tell.

Reader says...
I just read about your post on ST engineering and how it funded your trips etc.

See:
Mystical art of wealth accumulation.

The importance of delaying gratification





When I tell people, sometimes they will say

"But what if the investment turn out bad how? 

"Might as well spend the money enjoy now?"





What will you say to them ah?

It happens to me quite often cos I don go travelling and save the money top up CPF, buy reits etc

Thank you as always. 🙂

AK says...
Someone on my FB wall just said CPF is PONZI again.

Let people say and do what they want.

We do what we feel is right and they do what they feel is right.

Time will tell and it certainly has been the case for me. 😉

Time is also precious (especially now that I need more time than ever for Neverwinter).

Don't spend it on people who do not wish to listen.

Yes, I know.

Bad AK! Bad AK!

I am scolding AK of ASSI hor. ;p




...


...





Related post:
1. Building an income portfolio.
2. CPF is really a PONZI scheme.
3. Getting the stuff we want for free.

"My wife says I should have balls of steel like AK."

Reader says...
I invested in Comfort before you but sold when stock price dropped so much because I thought would drop more.

Then, I could buy back at a lower price.

Till now, I am still waiting to buy back.

My wife told me I should have balls of steel like AK.

Haiz. How you do it?

AK says...
Alamak.

Balls of steel?

Sounds heavy and probably painful to walk around with too.

They might also rust and would need polishing.

Aiyoh, sounds like work.






I don't like pain and I don't like work even more.

Don't curse me leh.

Seriously, know what we are investing in and if we are sure it will pay dividends, all we have to do is to sit back and wait.





AK is super lazy and doesn't like moving around too much lah.

OK, if you are not too lazy, you might want to read the related posts at the end of this blog.

Ouch. Ouch! OUCH!





Related posts:
1. Mystical art of wealth accumulation.
2. Incomplete analysis of ComfortDelgro.
3. Patience is the hardest thing.