I am a fresh grad and working as a private tutor. I have just paid off all my loans and I now have 3k in CIMB Fastsaver, 2k in cash. Every month I will have average 3k of spare cash. How should I divide this among my POSB, CIMB, SSB and STI ETF? - Seedly
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Anonymous

Asked on 26 Jul 2018

I am a fresh grad and working as a private tutor. I have just paid off all my loans and I now have 3k in CIMB Fastsaver, 2k in cash. Every month I will have average 3k of spare cash. How should I divide this among my POSB, CIMB, SSB and STI ETF?

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You divide based on your

  1. Family Plan

  2. Asset purchase Plan

  3. Retirements Plan

Not short changing the reply here but is good to think thru point 1 to point 3 to commit ur investment tt benefits u and not go against u.

Hope my reply helps.

If you feel this reply have Quality, please upvote and check other Quality Reply.

https://seedly.sg/profile/a-kenichi-xi

Thank you.

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Kenneth Lou
Kenneth Lou
Level 9. God of Wisdom
Updated on 07 Jun 2019

Hello there! You actually left out a very key criteria, your age and life stages (eg attached, getting married or planning to have a kid etc).

But I will take it as though you are single and thinking to grow your wealth over a longer period of time :)

It's a very good base to begin with actually, let's get that straight! Good on you :)

And to be honest, 3k of spare cash a month is very ideal actually.

If I were you I would do this... (But this is not a recommendation):

  • POSB: $500 (for daily spending) cos it's easier to acess via iBanking, paylah, payNow etc. (and since you don't have SALARY credit)

  • CIMB: $1,000 (for my forced savings) at 1% p.a flat. (You can use this to also build up your cash reserves as well for larger ticket items in the future, eg wedding or home etc.

  • SSB: $500 (this one i think is preferential... depends on whether you want to lock up your cash by lending it to the government (10 year is not a bad time frame as well for your later half commitments eg kids expenses etc, when your SSB matures. ) I think effective p.a interest is around 2-3% not too bad...

  • STI ETF: $1,000 (let it compound magically over time!)

  • Robo-advisors: Oversease ETFs at a low cost (Something to consider as well, if you don't want to just limit your investment portfolio to just the Singapore market :) You can read what other community member's say here: https://seedly.sg/reviews/robo-advisors

Hope this helps :) And if you have any questions, feel free to ask me in the comments section below!

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Suzanne Tan
Suzanne Tan

30 Jul 2018

Hi Kenneth, what would you think of voluntary CPF contributions? How many percent should go to that?
Kenneth Lou
Kenneth Lou

31 Jul 2018

Hey Suzanne! I think voluntary contributions for CPF it's really up to you! Main thing is to note if you can get a better savings rate externally. This is unlikely eg you can get 1% from a CIMB account vs 2.5% in CPF OA and 4% in CPF SA. So if I were you, I would actually top up (how much is the key = map out if you plan to buy property, eg in 5 years time, you should work backwards to see how much you will need for the downpayment (you can use OA for this purpose) and continually pay from your OA for the full amount. But as a whole CPF contributions are definitely important. Take note: From 2016, the CPF Annual Limit is $37,740. :)
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Heng Kai Le
Heng Kai Le, Mondomover at School Of Life
Level 6. Master
Answered on 12 May 2020

Hi there!

How has your situation evolved since your posting?

I think it will be good to think of your short-term and long-term saving goals and name your various accounts accordingly. For example, my CIMB account is my Emergency Fund and my SSB is my Retirement Fund. (BTW, SSB yields ridiculously low interest rates these days. The 'in' thing to go for now is a Singlife account. 2.5% per annum!) I also have a Japan2026 fixed deposit with my wife; it's a goal that both of us came up with together. I think having such clear goals (with names!) helps to concretise your saving motivation.

Then channel your spare cash accordingly based on how soon you wish to attain each of these short-term and long-term goals.

Hope this helps!​​​

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Penny Chong
Penny Chong
Level 5. Genius
Answered on 11 May 2020

Look into S&P 500 for better returns (historically 10%)

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