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360 review - SRS, CPF and Saxos

I have recently completed my 360 review on what I want to do with my various investment accounts and this will be my final post on this topic. 

The various 360 topics are:

Today's will be a bumper edition of topics on CPF, SRS and SAXOs. 

360 review - CPF accounts

After reviewing the cash balances in both our CPF accounts and the various restrictions imposed on using it for investments, such as the 35% limit on what you can use to invest in stocks and shares, I decided not to touch them. Given that it is risk free and earns a 2.5% interest, I have decided to keep CPF as a buffer for my home's "mortgage" emergency fund. 



In the unfortunate event that if I loses my job or decided to take a sabbatical, the cash in the CPF accounts will be used for our monthly mortgages. Based on my computation, this emergency fund can support my home mortgages for about 4.4 years.  

One important action item resulting from the CPF review was that I decided to speed up the mortgage repayment even though the all-in cost of borrowing of 1.5% is lower than the 2.5% interest which I can earn in the CPF account. At the end of the day, a debt is still a debt. I think I would rather owe money to my CPF account then to owe money to a bank.  

While I acknowledge that housing is a good inflation hedge, my aim is to pay off my remaining mortgage by 55 years old. I intend to do that by either increasing my monthly repayment or do a lump sum payment and reduce the "CPF buffer" to around 18-24 months instead of the current 52 months. 

360 review - SRS accounts 

I recently top up the SRS accounts for me and wifey. The combined balance has now reached $160,000.  In addition to the tax savings and squirrelling some savings year by year, the good thing is that I finally decided what I should be doing with these accounts and hopefully I have the discipline to stick to the strategies. In case you wonder why Post Office Savings Bank uses a squirrel as well, the nature's answer is here.


I have decided to use the SRS accounts for long term strategies, for dividend or rental income and hopefully with no cut loss levels. I hope I can pass on that portfolio to the next generation. With the breaking down of minimum board lots from 1,000 shares to 100 shares, it will become easier to build up a portfolio of blue chips from January next year. What do I hope to see in that portfolio? 
  • Iconic blue chips. I want to build up a portfolio of iconic Singapore blue chip portfolio that has a strong Singapore Inc flavour and still likely to grow for the next 20-30 years. In that regard, following the weakness in the market, I have recently added Keppel Corporation to my SRS account. I will probably add some banks and telcos but will avoid airline stocks for now.  
  • Strong local brands.  It's hard to describe to you what such stocks are but to give you a flavor of what i am thinking about, it will be stocks such as Osim and Breadtalk. 
  • REITs, Business Trusts and Dividend-paying businesses. I will start adding REITs with good office and retail locations to the SRS portfolio. I want to start thinking of myself as landlords collecting rental every 3-6 months. I may add business trusts if the business model has sustainable and recurring earnings. I would consider toll road operators such as China Merchant Holdings or education provider Overseas Education in this category
360 review - Saxos

I have classified all my other accounts under the topic Saxos. This will include Futures and CFDs as well. I have decided to start focusing more attention on US markets as well given the breadth and depth of the markets there. With the advance of technology, I no longer need to limit myself to the Singapore market that really "cannot make it" 

I will use the Saxos account for a few purposes:
  • Investing and/or trading in global iconic stocks such as Alibaba, Google and Apple. 
  • Use local CFDs and Futures to hedge my positions in SRS in the event of a major crash.
I would like to build up a portfolio of global iconic stocks over time as well. 

360 review - Time 


My time is limited. This will be my last post on 360 review and you can see that it is a long post as i want to save time and squeeze everything into one post. hahaha 

Given my heavy work load, frequent travels and the retirement plans, I find it difficult to blog too frequently. As such, I will not be able to update my investments and trades on a real time basis. However, rest assured, I will continue to review all the IPO companies here and give you my chilli ratings. :) 

Before i sign off, have you watched the video from NTUC Income recently. I thought it was rather thought provoking. While i am not a fan of insurance products, it might serve to remind you to do your own retirement planning and the future you will thank you for that

Here is the video below for your enjoyment. ~ Mr. IPO


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