I have a budget of around $200 monthly for investment. My major goal will be getting a HDB flat at 30 years old (Got my PR two year ago. What can I do with the $200 monthly to grow the wealth? - Seedly
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Asked on 02 May 2020

I have a budget of around $200 monthly for investment. My major goal will be getting a HDB flat at 30 years old (Got my PR two year ago. What can I do with the $200 monthly to grow the wealth?


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Hi Anon,

Congratulations on securing the PR. As much as it's important to know your actual time horizon for your investment and risk tolerance, generally speaking you can start off by investing in ETFs or Unit Trusts through a regular savings plan. There are good platform such as robo-advisors or FSM to start with. And with investing consistently monthly, you will be doing dollar cost averaging which help you to benefit even from a bear market.

If you are strategizing this investment with any payment to your purchase of flat, then I believe it's better to do a proper calculation with your circumstances so you can reverse engineer to see the possibilites of achieving that goal with your current commitment and the areas of improvement.

To have a clearer picture of planning, feel free to consult any licensed financial services consultant or reach out to me! Hope this helps!


👍 1

How old are you?

  1. 23% of salary - CPF OA (Subject to income ceiling of $6,000)

Figures are monthly

A simple calculation to determine your budget for your home loan-

Salary x 0.23 = Loan amount so you do not have to use cash (A)

Per $100k Loan from HDB @ 2.6% (25 Years) = $454 (B)

Take A / B x $100,000 = Max Loan you can take using CPF OA as your loan payment (C)

Finally, take (C) / 0.95 = Max value of the home you can get without additional cash monthly mortgage payments.

5% Cash/CPF OA

Set aside 2% of the purchase price for agent fees and etc

50K for renovation if needed

If you are close to 30, just save the money and set it aside for liquidity needs. There is just no magical investment that will reduce your upcoming liabilities significantly without first having a huge capital outlay.​​​

1 comment

👍 0
Question Poster

03 May 2020

Fyi, I am 27 y/o

Hey there! Good foresight to invest to grow your money for a house! You will probably have to use the Dollar Cost Averaging strategy (which will be a good, long term strategy which will be apt since you will probably get your flat in the next 5-10 years). You can start with Roboadvisors eg. Stashaway. They are a great platform for beginners. Consider doing DCA on an ETF! Certain ETFs are great eg. Vanguard S&P500. Roboadvisors are a great way to start eg. Stashaway. The other alternative (if you are really too busy/lazy to read up) is to get an ILP and do DCA. Take note of the costs that comes with every investment.

Financial planning is an integral part of life. You can find me at this platform to find out more.


👍 0

What to Invest

It depends on your risk appetite, as well as investment horizon (we need your current age to determine the time period to 30 years old).

Generally, you may consider dollar cost averaging into financial instruments like bonds, blue chips, ETF, or unit trust.

More Details:

Dollar Cost Averaging

At this point, you need to determine whether you possess the knowledge, skills, experience, and time to invest on your own or if you prefer to have professional guidance. Through global investment firms like Mercer, BlackRock, they are able to create a customised portfolio that suits your risk tolerance level.

Cash Flow

At the same time, we need to have a complete understanding on our cashflow. Through this process, we will understand our earning ability and spending habit.

Here is a Guide:

Understanding Your Personal Cash Flow

This is because investing takes time and you will want to ensure that you have short-term liquidity well-covered.


Meanwhile, I will suggest for you to do a more in-depth research on the HDB that you intend to get and to work out the numbers. This way, we will have a well-defined number to work towards.

In like manner, this will allow us to adjust our investment accordingly to reach this goal.

I share quality content on estate planning and financial planning here.


👍 0
Question Poster

03 May 2020

Fyi, I am 27 y/o
Pang Zhe Liang
Pang Zhe Liang

03 May 2020

In this case, I will suggest for you to establish a well-defined goal first. Thereafter, work out your cashflow and understand your shortfall to your goal. Moreover, you may consider maximising your money in high yield bank accounts, fixed deposit, or short term bonds. With 3 years to your goal, investment may or may not be the best choice. This is because it only yields non-guaranteed returns. Therefore, we will need to do an-depth analysis before we can determine whether to invest your money, or to put in financial instruments that yield guaranteed returns.