Author: Max | Achieving Financial Independence

How much do you need to retire? | Find out with the Retirement Savings Chart

When is the last time you bought a lottery ticket and thought to yourself: ‘I am going to stop working if I win the grand prize’. How do you know that the prize money is enough to sustain your retirement lifestyle? Have you ever wondered how much money is required for you to achieve independence? Max also faced the same problem when drawing up his Masterplan to retire by 40. Not knowing the size of your retirement gold nest is akin to running a race without knowing the finishing line. You cannot plan for it and spread your resources,...

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When is the best time for making OA to SA transfer | Earlier is not always better

Few months back Max wrote a post to discuss the things to consider before transferring our CPF money from OA to SA savings. Essentially, the post discussed that if the transfer is made earlier, the power of compounding at the higher interest rate will reap significant benefits, but because the transfer is irreversible, the ‘in case I need it’ mentality is still the key barrier for some to optimize their CPF savings. Majority of us (if not all) understand the principle that we should make the transfer early for CPF optimization. This statement is absolutely correct. But do you...

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Personal tax rebate made me lost $98

Just before end of 2016, Max did a voluntary cash top up of $7k to his CPF-SA savings. As you can see from the dates of transfer, the transfer was a decision at the eleventh-hour. The transfer is split into two transaction ($3.8k + $3.2k) due to the daily transfer limit on my bank account. Max’s voluntary cash top-up to CPF SA in year 2016 It was fortunate that the second transfer confirmed on 1 Jan 2017 was still eligible for the tax relief for YA 2017. I guess it’s because I made the transaction on 30 Dec 2016 and...

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CPF Retirement Sum Scheme | Can I achieve the CPF retirement sum when I reach 55?

The CPF Retirement Sum Scheme is one of the CPF schemes for us to utilize the money in our CPF. In fact, in my opinion, it is the most important CPF scheme as it will determine the ‘fate’ of the savings we painstakingly built up throughout the working life. Unless we are approaching the magic number of age 55 to be eligible for CPF withdrawal (after setting aside the Retirement Sum), chances are we will not be able to determine the amount of CPF savings we will have by then. Furthermore, there involve an uncertainty with the expected annual...

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Understanding the Financial Independence Model | part 1

Followers of this financial blog would know that Max has been working on the Financial Independence Model (FIM) since the beginning of 2017. In a nutshell, the FIM is designed to help individuals compute their personalized FI age, based on basic financial information provided by the user. For readers who are new to the FIM, a more detailed post on the main functions and principle of the model can be found in the post here. So far, Max has tested the model with financial input from over 10 readers, with reasonable and logical output achieved. Below is the feedback...

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Financial Independence Model | find out your retirement age now

Let’s dive straight in. Have you ever wondered how long we have to work before having enough to sustain the kind of (family) lifestyle for the rest of our life? Do you have know whether the amount of savings in your CPF is sufficient for your expenses at old age? Are you thinking of switching to a less hectic and lower paying job but have no idea how will this decision affect your financial journey? These are the same questions Max asked himself over and over again, but are futile efforts because of the complexity and numerous factors to...

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Do you have a plan for early retirement?

Achieving financial independence (FI) is the dream of many working adults. We dream of lying on the bahamas beach sipping watermelon juice. We plan to devote our time to charitable acts. We want to chase our passion, to do the things we love, instead of the things we need to. Basically, we want to stop exchanging our life (time, effort and energy) to live (our desired lifestyle). Regardless of what is the kind of life you want to lead upon FI, one thing is for sure: we need to have a personal plan for achieving financial independence. The plan...

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Should I transfer money from OA to SA account?

One of the key aspect to achieving early Financial Independence is to optimise the returns of your wealth. However, many people focuses primarily on building up their cash bags and neglect the other bulk of their savings, the CPF. Although our CPF savings cannot be withdrawn before the age of 55, it is important to start acting early, to take advantage of the risk-free interest rate on our CPF savings. One of the available CPF schemes is to transfer OA savings to SA account (OA-SA transfer). What is the difference between OA and SA account? Unless you have just...

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Are you neglecting your wealth: you have more CPF savings than you think

Let me start this post by the following statement: At least 31% of your wealth are in CPF Rub your eyes, stare at the statement again. <No, this is not a typo> If your only source of income is your full-time employment, then a whooping 31% of your income goes to CPF, and the remaining 69% are the cold hard cash you receive as monthly take-home pay. Are you kidding me? 31%? For readers who are convinced, you may skip to the next section. Otherwise, read on for a quick explanation. For employee below 55, 20% of your wage will...

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1 year closer to financial independence – great 2016, awesome 2017?

2016 will be a critical year in my life as I began to take a more active approach to achieving my financial goals. Let’s evaluate how I fare and set new goals for 2017. Income – Evaluating my source of money Total income (after CPF deduction) for 2016 is broken down into 4 main categories: Salary – 67.4% Bonus – 30.5% Benefits – 0.9% Others – 1.1% Benefits are subsidies which I received from my company for qualified spending on my well-being, such as insurance, air ticket, dental etc. As I am tracking these spending under my ‘expenses’, the corresponding...

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