My Retirement Plan
Published: Friday December 14, 2018
There have been many articles that Singaporeans are just not saving enough for retirement. So today, I am putting into action my retirement plan.
There are a few instruments that help us achieve our financial goals, such as CPF Life, annuities and retirement plans issued by insurance companies, investing and etc. There isn’t a one-size-fits-all solution simply because all of us have different risk-profiles, lifestyles, needs, wants, goals, etc.
I consider myself a low to medium risk taker and this is my retirement plan.
My Retirement Plan
In June 2018, I started investing in the Singapore stock market through a Regular Savings Plan by buying S$100 a month worth of ETFs. Today, another vechicle I will use to acheive my financial goals is through my CPF.
If you already did not know, the CPF is a mandatory social security savings scheme funded by contributions from employers and employees. The CPF is a key pillar of Singapore’s social security system, and serves to meet our retirement, housing and healthcare needs. Another important term and policy you need to know is CPF Lifelong Income For The Elderly (CPF Life). CPF Life is crucial to every Singaporean’s retirement planning. The CPF LIFE Scheme is a life annuity scheme that provides Singapore Citizens and Permanent Residents with a monthly payout for as long as they live. You will automatically be included in CPF LIFE to enjoy lifelong payouts if:
- you are a Singapore Citizen or Permanent Resident born in 1958 or after ; and
- have at least $60,000 in your Retirement Account six months before you reach your payout eligibility age.
I will be utilizing the Retirement Sum Topping-Up Scheme. The Retirement Sum Topping-up Scheme allows you to build your retirement savings. You can also help to build up your loved ones’ retirement savings by topping up into their CPF account under this scheme.
There are two main benefits of topping CPF.
- Earn more interest
- Enjoy more tax relief
To learn more about the Retirement Sum Topping-up Scheme, please click here.
Earning a risk-free interest rate of around 4% per annum, I am choosing to top up my CPF by another S$100 a month.