Comments for Investment Moats https://investmentmoats.com Wealth Mentor for Financial Independence Tue, 28 Jan 2020 00:17:30 +0000 hourly 1 https://wordpress.org/?v=5.2.5 Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Kyith https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263391 Tue, 28 Jan 2020 00:17:30 +0000 http://investmentmoats.com/?p=11237#comment-263391 Hi Oken, thanks for sharing your thoughts. I think i laid out the case where i thought it will make a different and sort of came to a conclusion it might make less of a difference. The ERS is good for those people who have more but really not much more, and their expenses are rather in control. That is why I say “might”. I will lean towards not make so much of a difference because most readers would be expecting to spend $4000 to $9000 a month. In this region, ERS might not make much of a difference at all.

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Kyith https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263390 Tue, 28 Jan 2020 00:13:59 +0000 http://investmentmoats.com/?p=11237#comment-263390 Hi Kay,

They could put their money in a balanced portfolio of 40% equity 60% bonds, 50% equity 50% bonds, 60% equity 40% bonds to have a chance to generate that return. 25 years is still a pretty long time frame. The research have shown that if you do not have adequate equity allocation, your portfolio stands a lower chance it will last for 25 years.

The problem for most people… is that they need to understand general equity and bonds relationship over time better. I tried writing some of it but i wonder how many feel a 60/40 portfolio is safe enough.

Best Regards,

Kyith

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Kay https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263368 Mon, 27 Jan 2020 12:22:29 +0000 http://investmentmoats.com/?p=11237#comment-263368 15 years into retirement and at 70, how will this aged couple will be able to continue generating 4.5% pa return that will likely needs to be capital protected. Add another 10 years, at 80, how could the couple cope?

I think there is probably great interests out there for near retirement people who are not investment savvy to understand how this can be done?

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Oken https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263351 Mon, 27 Jan 2020 01:59:31 +0000 http://investmentmoats.com/?p=11237#comment-263351 I understand. And yes, I was referring to the differential between FRS and ERS.

I just didn’t think it was fair to describe CPF life as ‘not much difference’. I would find it difficult to find instances where one choose NOT to top up to ERS if one was financially able to.

I don’t think there are any other investments which would payout so much at such a low level of risk. My general assumption is that everyone should pump CPF life for as much as they can. Perhaps it would be useful to explore to what extent we should leverage CPF life and under what circumstances it would be unwise to do so…

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Kyith https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263349 Mon, 27 Jan 2020 00:59:00 +0000 http://investmentmoats.com/?p=11237#comment-263349 I would say… It is significant if your additional income needs are low. Perhaps you need a $1000 a month bump up. ERS is a low hurdle to do that since the difference is $53,000 thereabouts. Perhaps I should make it clearer

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Sinkie https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263337 Sun, 26 Jan 2020 18:34:42 +0000 http://investmentmoats.com/?p=11237#comment-263337 CPF is geared towards low & lower middle-income, provided they do their part to hit at least the BRS.

This is why the extra 1% and 2% interest is only applied to the first $60K. These “socialised subsidies” won’t mean much to those with million-dollar CPF accounts (or even $300K accounts).

If you’re “rich”, you’re expected to be able to take care of your own finances.

@Oken,

You won’t be able to double your annuity by going from FRS to ERS, since ERS is just 50% more than FRS.

In fact you will get slightly less than 50% more from ERS than FRS. This is becoz, as I have explained above, the returns of CPF Life are weighted more to the first $60K.

You can confirm this by playing around with the CPF Life calculator:
Annuity amount from FRS is less than 2X from BRS.
And the amount from ERS is less than 1.5X from FRS.

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by T https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263324 Sun, 26 Jan 2020 14:04:20 +0000 http://investmentmoats.com/?p=11237#comment-263324 i think he probably mean to get an additional $6k a year

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Kyith https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263322 Sun, 26 Jan 2020 13:31:41 +0000 http://investmentmoats.com/?p=11237#comment-263322 Hi Oken, I think i need to understand your question more clearly. If a person who needs $6k a year, he do not need ERS. FRS or BRS will do.

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Rayson Teng https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263319 Sun, 26 Jan 2020 12:22:03 +0000 http://investmentmoats.com/?p=11237#comment-263319 Show me how to get 6k ….

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Comment on Topping Up Your CPF Life to Enhanced Retirement Sum (ERS) Might not make Much Difference by Oken https://investmentmoats.com/financial-independence/topping-up-your-cpf-life-to-enhanced-retirement-sum/#comment-263298 Sun, 26 Jan 2020 04:03:12 +0000 http://investmentmoats.com/?p=11237#comment-263298 For a single person to have a annual income of $6k according to the 4% rule, he needs a lump sum of $150k.
For a Singaporean to get an additional $6k per year (FRS to ERS), he needs to have a lump sum of $90,500.

How is this not significant or worth it?

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