OK, so let's take out the elephant (or in this case, my Money Saving Kitty!) in the room out and start talking about. And by that I mean talking about MONEY! How can anyone retire in Singapore at an early age if you are not from a rich family? The cost of living is so high here. Well guess what, I am not going to go there. This is not about what is the right or wrong way to do that. This is about how you can find ways to achieve that goal. So let me share with you how I plan to do it.
First a little about me. I am a Singapore PR originating from Penang Malaysia, and I am married, and live in a 4 room HDB. I don't have any kids, but I am supporting my 2 parents in Malaysia. I do have a post graduate in Software Engineering and do earn an above average salary (median Singapore Salary in 2015 was of SGD3.7k). But I've never been one that is aggressive in terms of salary, and to be frank, I am probably the lowest paid among my peers. But let's get salary our of the equation here and just focus on our goals of retiring! If we are always tied to the idea of salary, we can never free ourselves from being employed! So let's start sharing:
How much money do you save
And how much money you spend makes a lot of difference here. Do you spend everything you earn? Or save them? How is your cash flow? Lucky for me, I don't really spend money. Growing up poor kinda limits your imagination on what you can spend on. So I more or less have been saving more than 50% of my salary since I started working. Here is roughly what I spend on a monthly basis (in 2017 while still being employed):
- 100SGD on utilities (Singapore Power bills + Singtel Mobile Bills)
- 100SGD on transportation (MRT or bus, and my office is like 15mins by bus)
- 300SGD daily meals (On average I try to spend 10SGD per day on meals)
- 300SGD misc (credit cards, entertainment, treats, shopping)
So in general, I need around SGD2k to survive monthly. This does not includes allowance to my dependences, insurance, taxes and healthcare!
Singapore government also have this thing call CPF where they deduct around 20% of your pay for your old age fund which they only give out when you reach 65 years old.
Are you in debt? How is your cash flow?
My HDB which was bought for SGD220k in 2004 is fully paid off within 7 years from the date we purchased. This is not average for Singaporeans, but let's just say me and my husband don't trust ourselves to commit to a long term loan. I do still have one debt I am still servicing for a small condo I purchased in Penang back in 2013? This is my backup plan for retirement back in Penang should I ever need to. I hate paying rent. Renting feels like your bucket has a hole in it and water is always rushing out and you can never get those money back.
Passive Income, how do you plan to support yourself after you retire.
Currently my goal is to have a passive income of at least 500SGD a month. So that's 6000SGD per annum. I plan to use the rest of my savings so far to help me reach my death bed. I have also not ruled out getting fun jobs to learn new things, pass the time and earn a small salary to get by. There is also an option of renting out our flats or room to supplement our income.
In reality? My condo in Penang generates enough from rental to stop me worrying much about my mortgage for the place. So that kinda took care of itself. I do invest in shares and blue chip investments, and inclusive of bank saving account interest, I kinda achieved 50% of my targeted passive income currently! Yay. And my investments can only grow along the years. By the way, I don't consider investment and insurance as expenditure cause I fully intend to gain back my money at the end of it. If I am being naive, do share your thoughts with me!
I think I'll stop here for today. If you have no idea what I am talking about till now, perhaps I can recommend you to read Rich Dad Poor Dad. It explains all the above simple enough, and should be able to get you started. I know that is where I started learning about cash flow and passive income. I'll leave the link below so you can have access to it. And because we need to save money here, my link is to the National Library Board so that you can stop wasting your money buying books and spend it achieving your retirement instead!
Ref:
No comments:
Post a Comment