#WhatsYourPlan (for Retirement)

Educating the public, Gov.sg has mentioned on their site - What's your Plan? (click here) - that "saving for retirement can seem like a daunting task, but it need not be that way. Let us help you with tips to better manage your finances, grow your savings, and plan for your golden years."

I applaud Gov.sg for such initiatives to get people to think about their retirement. It ain't easy to get people to think for their retirement early (let alone plan for their retirement early). So since Gov.sg has been asking about our plans, here is my plan.

#WhatsMyPlan

1. Continue growing my CPF-SA to a Substantial Amount

In my previous posts - Minimum Sum of S$564,797 In Year 2047? and Four Building Blocks For My Retirement - I have mentioned that CPF is a fundamental part of my retirement. Will I totally rely on it for my retirement? NO! However, it is still a pillar to most Singaporeans in terms of retirement savings.

One known fact (hard truth) is that the Minimum Sum (now known as Basic Retirement Sum) will definitely grow / increase. Another known fact (hard truth for the next 5 years at least) is that I will continue to contribute to my CPF as long as I am employed. The Plan is simple. Just like every normal Singaporean, 1) I will continue to stay employed, contribute to my CPF and slowly grow my CPF accounts month by month; and 2) I will do micro-transfer of funds from my CPF-OA to my CPF-SA (Read - My First Transfer From CPF-OA To CPF-SA).

I have to do my part to accelerate my CPF-SA to a substantial amount and then let CPF Board do their work to compound the interest in my CPF-SA. Under the CPF Life scheme, I will then be provided a monthly payout for life from the time I turn 65. This is a form of retirement savings plus annuity.

2. Supplementary Retirement Scheme (SRS) to build a Bigger Nest Egg

I am in my 4th year of contributing to my SRS account - 4th Installment (Another S$12,750) In My SRS Account. I will not explain more about the SRS account in this post.

I have mentioned about my plan (many times) in various posts in this blog. 20 years of contribution and using the funds in the account to invest in the STI ETF. I would have contributed S$255,000 after 20 years.

In all investments, we are unable to predict how well our investment is going to pay off. With a simple calculation of an average annual return of 4%, this sum will be ~S$379,600. There will be years with big drops and years with big growth. As such, I still believe the 4% is rather conservative.

3. Generating Passive Income with Dividends Paying Stocks

I am building a portfolio of dividend paying stocks. I personally believe the stock market is one of the best source of passive income through dividend paying stocks. In my last post, Five Bloggers Collecting > S$10,000 of Dividends Yearly, I have highlighted several bloggers that have achieved it.

While I am still far from my goal of exceeding my monthly paycheck, I have seen progress over the last 2 years (see below). The next milestone is to reach the S$10,000 mark.


Conclusion

I have highlighted Three Big Components of my Plan.

Planning for your retirement is an important issue, but it is also something we often procrastinate on. I, totally, resonated with a featured video by Gov.sg (Watch it below) because I have seen with my own eyes family members that are suffering.

Jimmy: "Ready to retire?"
Uncle: "I've been getting ready since I was your age."
Jimmy: "You're joking right? Whatever I can earn, I just spend."

The video went on to share Uncle Lim's story about how he was once like Jimmy.

To my partner (that will never be reading this post), in my vows, I did mention the promise to save and grow old together in our own home.

So everyone, #WhatsYourPlan for your retirement?