Goals for 2021

 It is typical for anyone to have resolutions and goals for the new year. I am like any normal person and have set my sights on certain goals to be completed for 2021. The saying goes 'If you fail to plan, you plan to fail'. More importantly for me, incremental goals help me get some small wins and keeps my wife and I motivated on this journey.

Health related:

Lose 5kg and lower my blood cholesterol levels.

Both guys and girls struggle with body image issues. Recently with our LO around, it has been more difficult to find time for workouts. When I went for a recent health check-up, the nurse told me that my 'bad' cholesterol was on the upper range limit. This was a first and a wake-up call. No point doing so much financially but not staying healthy to reap the benefits in the future. My wife and I will be looking to workout at least 3 times a week in the upcoming year.

Precious Metals:

Add >1 oz of gold; Add >30oz of silver

Just a little hobby of mine. Gold and silver here includes graded and non-graded precious metals, bars and coins. Kinda see this as a hedge and having the physical metal to hold is just different from having it on 'paper'.

Investment related:

Continue with DCA strategy with new exposures; Increase CPF top-ups; Increase SRS top-ups.

We are going to continue with our DCA strategy but look for more areas that may have growth. In the upcoming year, we will also look to top-up our CPF and SRS accounts for investment and tax-deduction purposes.

That is some of the goals that we have set for ourselves this year. I will update accordingly every quarter and monitor our progress.

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SG FI Dad, out.

Thoughts about the 1M65 concept

 1M65 stands for One Million by Age 65. It is a unique strategy popularised by Mr Loo Cheng Chuan. You may refer here for a breakdown of his strategy and thoughts on retirement planning.

Recently, I had the time to watch a Webcast that Mr Loo hosted and it was eye-opening. Both the Mrs and I knew that CPF will eventually form the foundation of our retirement portfolio. Something that is virtually risk-free and backed by the Singapore Government, what's there not to like??? He went on to list a few misconceptions that may cause people to not want to have their money in CPF.

Nonetheless, the Mrs and I are definitely looking to execute the 1M65 strategy as part of our retirement plans which essentially means that by 65, each of us should reach a minimum of $500k in our account. I would say there are probably short term, medium term and long term goals for us.

Short term goals for each of us (< 5 years)

Attain a total of $130k in our Special and Medisave Account by age 34.

Mr Loo said that the combined sum used to have a ceiling of $130k back in his day. However, with a time horizon of more than 25 years, compound interest will have a significant effect in increasing this sum substantially. We will be looking to transfer a sum (either monthly or lump sum at the end of the year) from our Ordinary Account to our Special Account.

Medium term goals for each of us (between 5 to 10 years)

With the foundation of this strategy achieved, our next move will probably be two-pronged. Firstly, we will probably look into initiating a small position using our CPF monies into a S&P Index fund or a similar ETF. At this point, we are looking at a maximum of 10% of our CPF funds to mitigate for any drawdown or volatility risks. Second, we will try to reduce/pay off our mortgage principal yearly to reduce the accrued interest payable to CPF should we decide to sell off our place in the future. On that note, Mr Loo did mention that he does not encourage people to buy private properties whether it is for staying or investment. Rental yields in Singapore have been on the downtrend especially so after Covid-19 hit us. But we will see what the future holds. I think I will be contented just staying in my HDB for now. heh.

Long term goals for each of us (>10 years)

Adjust CPFIS and close position if necessary. Based on my calculations, we should be able to hit 1M65 in our combined accounts by age 45 barring any other black swan events or you know, if life decides that we need more hurdles. Really from 10 years onwards, we hope to be cruising and be contented that our earlier sacrifices have paid off.

Share with me your thoughts on the 1M65 strategy and CPF!

SG FI Dad, out.