Wednesday, May 14, 2014

Personal savings for the future

Many people found that they do not have any savings when they reach age 60 and their CPF savings is locked into the minimum sum. Some of them have debts to pay.

There is nothing much that can be done for the older people, except for the CPF policy to be changed.

For younger people, especially those who have just started work, I wish to give the following advice:

1. Set aside 15% of your income as personal saving, in addition to the compulsory savings in the CPF.
2. Invest your personal savings in the STI ETF to get a good yield over the long term. This investment is better than bonds, or investing in individual shares.
3. When you buy a property, make sure that the monthly installments can be paid entirely from CPF savings. Do not buy an expensive property that require you to pay cash, in addition to the CPF savings.

These principles are explained in my book "Financial Planning for Young People", available at

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