Felix Hoe - member of APEX Group

08/10/2024

Providing for Children’s Overseas Education at the Expense of Your Retirement – Does It Make Sense?

As parents, we all want to give our children the Best opportunities in life, and for many, that means providing them with a high-quality overseas education. But what happens when funding this dream starts to jeopardize your own financial future—particularly your Retirement?

It’s a common dilemma: Should you sacrifice your retirement savings to send your child abroad for education? The short answer is, No, it doesn’t have to be an either-or situation.

While it’s understandable to prioritize your child’s future, remember that delaying or compromising your retirement could lead to financial strain in the long run, placing a burden not only on you but potentially on your children later on. The key question is: Can you achieve both goals?

✨ How to Prevent Sacrificing Retirement for Education:
1.⁠ ⁠Plan Early: Start saving for both goals as soon as possible. Separate funds for education and retirement, and make use of financial tools like education savings plans and retirement accounts.
2.⁠ ⁠Balance Your Budget: Work with a financial planner to create a strategy that ensures you’re allocating funds to both retirement and education without compromising either.
3.⁠ ⁠Explore Scholarships and Financial Aid: Encourage your child to apply for scholarships, grants, and other financial aid options that can reduce the overall cost of their education.
4.⁠ ⁠Set Clear Expectations: Have an open discussion with your child about your financial limits and explore alternative options such as more affordable institutions, online courses, or local education followed by overseas postgraduate studies.
5.⁠ ⁠Consider Education Loans: Education loans can be a viable option, allowing your child to take on some responsibility for their education while keeping your retirement plans intact.

In conclusion, while it’s natural to want to provide the Best for your children, it’s crucial to strike a balance. By planning ahead, being financially disciplined, and exploring all options, you can support your child’s education without sacrificing your own financial security. You deserve a comfortable retirement—and with the right strategy, you can Achieve both!

Let's catch up for coffee soon 😃

17/07/2023

Chinese films in the past talks about the sought after Pill of Immortality. Even scale mountains to get the sacred ingredients.
𝐏𝐞𝐨𝐩𝐥𝐞 𝐚𝐫𝐞 𝐚𝐟𝐫𝐚𝐢𝐝 𝐨𝐟 𝐝𝐲𝐢𝐧𝐠

Today we talk about the cost of the pills. Afraid to face the mountain of debt to extend mortality.
𝐏𝐞𝐨𝐩𝐥𝐞 𝐚𝐫𝐞 𝐚𝐟𝐫𝐚𝐢𝐝 𝐨𝐟 𝐥𝐢𝐯𝐢𝐧𝐠 (𝐭𝐨𝐨 𝐥𝐨𝐧𝐠)

Times have changed, the longevity pill...
Once a 𝘿𝙧𝙚𝙖𝙢… 😇
May have become a 𝙉𝙞𝙜𝙝𝙩𝙢𝙖𝙧𝙚 ….😱

It was a thought provoking article for me, as a consultant specialised in retirement planning...
higher life expectancy should be celebrated!! 🥳
𝘼𝙧𝙚 𝙮𝙤𝙪 𝙘𝙚𝙡𝙚𝙗𝙧𝙖𝙩𝙞𝙣𝙜 𝙩𝙝𝙞𝙨? 🤔

love to hear your thoughts, PM me and share more

17/07/2023

Today is the day to honor those souls striving hard in life to make it worthwhile.

Happy Labor Day to all the hardworking men and women!

17/07/2023

Singapore and other ASEAN economies may have a unique opportunity to increase their share of world trade as an increasing number of global manufacturers seek to move sourcing of supplies and production out of China.

The trend is not new, but China's disruptive Covid-19 lockdowns and intensifying tensions with the United States have added a sense of urgency among multinational.companies seeking more resilient and conflict-free supply chains.

What this story and many recent events told us?

1. Interest rate tends to be stabilised and seeing some downward trending.
2. Many countries are open up their Trade, Travel and Business channel.

Is it a sign of market recovery? Or Will the market plunge further?

Nobody will knows what is the market sentiments.
Most importantly is not figuring how to time the market but how much time in the market!

Hope your investment fly high again, or PM admin for an Investment Portfolio review to identify your potential blind spots.

17/07/2023

In recent years, COVID-19 not only disrupted our way of living but also impacted the market badly.

What do we learn from recent market crashes? Everyone makes mistakes. The difference comes from how you learn the right lessons from the past and apply them to the future.

1. Avoiding all stocks due to high interest rates. Simultaneous occurrence of two events seems to suggest that they are connected and be wary of making blanket conclusions based on interest rates.

2. Timing your entry based on the Fed’s next move. Beware, dear investors. It’s a mental trap.

3. Selling before the bad news hits. If there is a new development negatively impacting a business, its stock price would have fallen before you even had the chance to open your brokerage account.

4. Falling for the stock price narrative. When a stock price falls significantly, there is an immediate assumption that something terrible has happened to the company. That may be true, but it is not always the case.

5. Waiting for lower volatility. Missing the best days in stock market is far worse than missing the worst days.

Inclusion, you’re better off staying put, staying invested, and most of all, maintaining a long-term view of the markets.

Besides, the current market is volatile and potentially a good entry opportunity for many of us. Join our upcoming talks and learn how to plan ahead with different kinds of financial instruments that help you achieve your financial goals and dreams.

17/07/2023

Selamat Hari Raya Haji 🥰

May this Hard Ray Haji bring peace and prosperity.

17/07/2023

Wishing everyone, peace, unity and joy on this auspicious day.

HAPPY VESAK DAY!!😃🥰

17/07/2023

☀️The interest rate for the Special and MediSave Account (SMA) of Central Provident Fund (CPF) members will increase to 4.01 per cent per annum, up from 4 per cent, for the period from July 1 to Sept 30.

☀️The concessionary interest rate for HDB housing loans will also remain unchanged during this period at 2.6 per cent a year.

☀️The raising of the monthly salary ceiling for CPF contributions from $6,000 to $6,300, which will begin on Sept 1. And will be progressively increased to $8,000 by January 2026.

☀️No change to the annual salary ceiling, which sets the maximum amount of CPF contributions payable for all wages received in a year. This is currently set at $102,000, and includes both ordinary wages and additional wages.

For more details:

The rate increase will correspond with the raising of the monthly salary ceiling for CPF contributions in September. Read more at straitstimes.com.

17/07/2023

Planning for a consistent retirement income is crucial, especially considering the challenges many Singaporeans face with limited liquidity despite being asset-rich.

Recently, I met up with a few pre-retirees to discuss how to build a consistent retirement income.

One of the pre-retirees shared with me that her investment property is earning her a net 1% - 1.5% per annum from rentals after deducting all mortgages, service fees, and so on. Considering the current Additional Buyer's Stamp Duty (ABSD), Seller's Stamp Duty (SSD), and high borrowing costs, the real yield from rentals might be heavily impacted.

Diversifying one's portfolio is indeed a smart strategy to improve overall cash flow and manage risks effectively. By spreading investments across different asset classes, individuals can reduce their exposure to any single investment's performance. Diversification helps protect against potential downturns in specific sectors or markets and potentially enhances overall returns.

Additionally, starting retirement planning early is crucial. The power of compound interest over time can significantly boost savings and investments. By making regular contributions to retirement accounts or investment vehicles, individuals can take advantage of compounding, where returns are reinvested and earn additional returns over time. The longer the investment horizon, the greater the potential for compounding to work in one's favour.

Retirement is not by chance, it’s a guaranteed event!

Start Planning Now

17/07/2023

Achieving financial abundance, a dream or a reality?

It depending on an individual's approach to managing their finances and the choices they make.

The study interviewed 1,000 affluent Singaporeans between the ages of 25 and 64, learning that their household incomes ranged from $70,000 to over $250,000.

One of the key phrases that appealed the most in this article was ”Passive Income.” Once individuals' income from investments, rental properties, and annuities becomes enough to cover their expenses until retirement, they may consider themselves to have achieved financial freedom. On average, this journey to financial freedom took about 21.3 years.

The report identified three important aspects for growing and maintaining their wealth over time:
1. Patience in investments and long term planning.
2. A disciplined investment approach
3. Financial literacy

Financial literacy plays a crucial role in making smart financial decisions. Understanding money management, budgeting, personal finances, and investment opportunities allows individuals to take control of their financial journey. Being financially literate helps in identifying suitable investment options, minimising potential risks, and optimising returns.

17/07/2023

This week, let’s talk about reinvestment risk.

What is reinvestment risk?

Let’s assume today we allocate a portion of our cash into a 2 years Fixed Deposit (FD) or Short-term Endowment with 4% p.a. interest rate.Two years later, the FD or endowment matures, returning our principal and all accrued interest payable.

What will happen after which?

Most probably, many of us will start looking for the next FDs or similar financial product to ”renew” the term. What-if the rate is significant lower now (i.e. 0.8% p.a.)? What do we do next?

In the above scenario, if the FDs or short-term endowment matures and the available options for reinvestment offer a significantly lower interest rate, it poses a reinvestment risk. This means that the investor may NOT be able to achieve the same level of return or income as before.

Is it possible to avoid reinvestment risk? In my opinion, it’s impossible to totally get rid of it.

For example, our emergency fund (E-fund): Many people actually allocate their E-fund into FDs, enjoying greater flexibility and earning some interest while the funds remain untouched. However, the E-fund has no choice but to face reinvestment risk.

It's important to note that while it may be challenging to completely eliminate reinvestment risk, careful planning and diversification can help minimise its impact on your investment returns. Always consider your short-term and long-term goals, risk tolerance, and liquidity requirements when making investment decisions. Consulting with a financial advisor can also provide valuable insights tailored to your specific circumstances.

Remember, you work hard to earn money, so make sure your cash is working just as hard for you. Don't let it idle in the bank, but instead allocate it wisely according to your goals and risk tolerance.

15/05/2023

We need to put our money at work and invest it in the right class of financial instruments. How?

For instance, one shouldn't put too much cash into insurance planning because you may face big challenges when big expenses such as children's tertiary education or retirement are approaching. On the other hand, one shouldn't save or invest too much without enough insurance coverage in place either. This could force you to liquidate your assets when you don’t have enough coverage to cover hospitalization, critical illness expenses, and so on.

So now the question is, how much is too much or too little? Which coverage is most important?

For example, if you’re a pre- or retiree, in addition to good retirement income planning, you should also have coverage for hospitalization expenses, long-term care, critical illnesses, and personal accidents in place. Optionally, you can also consider term-life, whole-life, or universal-life insurance if you're planning to leave a legacy for loved ones.

However, if you’re young parents, your priorities will be vastly different.

In short, there's no fixed formula to follow while creating your financial plan. It always changes according to your lifestyle, goals, and dreams. As you reach new milestones in life, you will have different priorities from before.