Your search results

Don’t Miss Out: Take Control of Your Life in Your 30s and 40s

Posted by Jayson Ang on December 28, 2022

| 0

TLDR

The stages of wealth management vary from ages 30 to 80, with different focuses and considerations at each stage:

Age 30-40 (Wealth Accumulation): This period is for accumulating wealth, enjoying economic activity, and building a financial portfolio. Choices such as upgrading to larger flats or investing in properties with potential appreciation are common.

Age 40-50 (Wealth Growth): Individuals focus on paying off debts, managing CPF contributions, and contemplating active investment management versus passive growth.

Age 50-60 (Wealth Preservation): People can relax knowing they’ve secured their retirement, but financial decisions like selling property may impact their financial standing.

Age 60-70 (Wealth Distribution): Consideration of exit strategies, downsizing properties, renting out rooms for extra income, or exploring schemes like Lease Buyback.

Age 70-80 (Wealth Distribution II): Planning for longevity and health, potentially utilizing Eldershield premiums. It’s crucial to be proactive in preparing for the future.

Late start consequences can be significant due to inflation’s impact on savings and investments. Planning early for retirement is essential to ensure financial security when earning power diminishes. Starting now, not later, is crucial to building a secure financial future.

As we sail into our mid-30s, time seems to accelerate and soon enough we find ourselves heading toward the big 4-0.

We receive a notice from Eldershield, gently reminding us that we are edging closer to yet another milestone.

As time marches on, these small, gentle reminders serve as a reminder that we should begin planning for our retirement – because we are aging.

From 2019 to 2022, I was contacted by roughly 300+ people through my blog. Even though I have a further 1000+ subscribers in my mailing list who haven’t contacted me yet, some of the enquiries I received led to face-to-face meetings. This enabled me to make a few observations about the financial milestones of these people and their behaviour.

Age 30-40: Wealth Accumulation

The wealth accumulation stage is from the ages of 30 to 40 – a period where one can be most economically active and accumulate a solid financial portfolio. With more disposable cash than ever before, you can indulge in whatever excites you – whether it’s a trip around the world or a brand new car. Most importantly, you have the liberty to choose a job based on your interests and passions, rather than settling for what is given to you.

For those with kids, they often feel the need to upgrade to a larger flat due to the convenience it offers. Yet, these flats are often significantly cheaper than private properties, making them a desirable option for many – a fact which may explain their more economical price.

Another group of people, opting to upgrade to a property with greater potential for appreciation instead. This requires a degree of sacrifice, these individuals will challenge themselves to step outside their comfort zone. On the other hand, another group may have overindulged in luxuries during their prime, resulting in having to play catch-up in their later years.

Age 40-50: Wealth Growth

Between the ages of 40-50, many individuals find themselves intently striving to pay off their monthly dues. For some, their CPF contributions are sufficient, and for others, a little cash is needed for a top-up. Though it can be uncomfortable to save more and more money into their property, it is better to confront such feelings earlier on than later.

Those with a $1 million property already have an appreciation of its value far greater than someone with a $300K one due to the fact that inflation is measured by its rate of growth.

At this stage, they possess a wealth of experience both in the workplace and in life, resulting in a widening network of contacts that have seen varying degrees of success when it comes to investing – some succeeding, some falling short. So the question remains: is actively managing investments a wise decision, or is it better to just let them grow on their own?

Age 50-60: Wealth Preservation

As people enter their 50s and 60s, they can often relax a bit knowing that they have already taken the necessary steps to secure their retirement. Thanks to the wise saving habits they’ve cultivated earlier in life, they can now enjoy a slower pace of life with fewer financial worries. Knowing that the future is taken care of can give them peace of mind, allowing them to rest easy unless something truly unexpected occurs.

At 55 years old, some HDB owners who decide to sell their flat may find themselves at risk of experiencing a negative cash sales. Furthermore, they must remember that some of the proceeds from the sale will have to be put into their Retirement Account to meet the Minimum Sum. This is when their “report card” on their finances comes into play, ultimately affecting them.

Age 60-70: Wealth Distribution

If you’re of an age where your property should be fully paid off, it’s time to consider your exit strategies. For some, selling their private property and downgrading to a more affordable HDB flat could be the way to go – you’ll be left with a nice cash sum, and won’t have to worry about VERS affecting your HDB flat. Others might want to consider renting out a room to bring in some extra income. As an alternative to that, there’s always the Lease Buyback Scheme if VERS doesn’t become a reality.

Age 70-80: Wealth Distribution II

Reaching this age is certainly a possibility! The average life expectancy in Singapore is around 85 years old. That being said, it is our wish to remain healthy, mobile and independent for as long as possible. However, if we are unable to stay in good physical shape, our Eldershield premiums may just be of great use! Nevertheless, we should always strive to view this age as an opportunity and not a challenge. Therefore, let us be proactive and prepare ourselves for such a future!

What are the Consequences of Starting Late?

Have you heard of the Rule of 72? This handy tool can help you determine how long it will take for your investments to double – or more importantly, how quickly inflation can erode your savings. At a 4% inflation rate, your investments could lose half their value in just 18 years. For example, if you had $100,000 in the year 2010, without taking any steps to mitigate the effects of inflation, that same amount would be worth only $50,000 by 2028.

Conclusion

Do you plan to retire at 65 years old and live until 85? That’s 20 years worth of living, and if you and your partner need $2500 per month to live comfortably, that adds up to $600,000 in cash – and that’s on top of the property you’ll be living in. Planning for your retirement should be done now, not later. Procrastination is simply fear in disguise, so the only way to get past it is to just start. Begin planning for your future today!

How can you ensure greater financial security when your earning power is diminished?

No matter the outcome of my interactions with those I have encountered, they have all taken steps towards gaining a greater understanding of their financial situation with regards to their property.

If you are considering making changes to your current home or property portfolio, I am more than happy to offer a free and in-depth financial assessment.

Life is too short for us to go through it without a plan – so let’s make the most of it!

You May Also Like …

Mandarin Top 5

5 Things to Know About Singapore’s Urban Redevelopment and Landscape Changes

Jayson Ang – March 11, 2024 –

As one of the world's most densely populated cities, Singapore has undergone significant urban redevelopment over the past few decades...

All Buying Tips Opinion

The Influence of Soaring Land Costs on Singapore’s Real Estate Market: A Look at Land Price Trends Since 1992

Jayson Ang – October 7, 2024 –

TLDR When it comes to understanding the fluctuations in land prices in Singapore, historical patterns reveal significant spikes and dips...

Mandarin Top 5

5 Reasons Why Condos Are The Best Real Estate Investment in Singapore

Jayson Ang – March 25, 2024 –

Investing in a condo in Singapore is a popular choice for both locals and foreigners. Condominiums offer a range of...

Mandarin Top 5

The Psychology of Property Investing: 5 Reasons Why Singaporeans Love Real Estate

Jayson Ang – May 4, 2024 –

Real estate investing has always been a popular way to grow wealth and secure financial stability. In Singapore, the love...

All Blog Posts Buying Tips

Avoid These 6 Terrible Property “Tips” in Singapore

Jayson Ang – May 1, 2023 –

TLDR When it comes to property advice, it's crucial to be cautious of common misconceptions. For instance, schemes like the...

Mandarin Top 5

Top 5 Best Non-Touristy Things to Do in Singapore

Jayson Ang – October 31, 2024 –

Singapore, a vibrant city-state known for its iconic skyline and diverse culture, offers a plethora of experiences for both tourists...

Mandarin Top 5

How to Build a Property Empire in Singapore: Scaling Your Investments

Jayson Ang – May 8, 2024 –

Real estate investing is a popular way to build wealth and generate passive income. However, like any investment, it comes...

All Buying Tips Opinion Selling Tips

Learning Hard Truths in Property Investment: Timing the Market Can Hurt

Jayson Ang – August 29, 2024 –

TLDR The blog post delves into the complexities of market timing in property investment, highlighting the risks and challenges associated...

Mandarin Top 5

The Top 5 Factors to Consider When Investing in Industrial Property in Singapore – Expert Insights!

Jayson Ang – September 18, 2024 –

Singapore, a thriving hub of business and commerce in Southeast Asia, offers a robust real estate market with various investment...

All Buying Tips Top List

Finding the Perfect Match: Top 20 : A Guide to Choosing the Best Property Agent in Singapore

Jayson Ang – December 17, 2022 –

TLDR When it comes to buying or selling real estate in Singapore, having a professional and knowledgeable property agent is...

All Buying Tips

3 Exciting Residential Sites Coming Soon!

Jayson Ang – June 20, 2024 –

TLDR The Lion City is undergoing rejuvenation with upcoming developments in coveted areas like Clementi and sites near MRT stations....

All Buying Tips

What’s Next for HDB Owners?

Jayson Ang – December 7, 2022 –

Buying a home always seems daunting especially such it is a big-ticket item and the prices for private homes can easily...

Mandarin Top 5

From Garden City to Smart Nation: Singapore’s Top 5 Goals Building a Sustainable and Livable City

Jayson Ang – February 20, 2024 –

Singapore is a small island city-state with a population of over 5 million people. Its urban landscape is constantly evolving,...

All Opinion Reports

Is the Dream of Homeownership Becoming a Steeper Climb?

Jayson Ang – December 6, 2023 –

TLDR The article discusses the evolving trends in the Singaporean real estate market, focusing on the affordability and accessibility of...

Mandarin Top 5

5 Tips To Spot Winning Investment Properties In Singapore

Jayson Ang – September 6, 2024 –

Investing in real estate is an exciting and potentially lucrative venture. In Singapore, a thriving property market attracts both local...

Mandarin Top 5

Singapore’s Urban Landscape Transformation: 5 Key Things You Need to Know

Jayson Ang – March 17, 2024 –

Singapore's urban landscape has undergone significant changes over the years, with the city constantly evolving to create a sustainable and...

All Buying Tips

Superstitions in the Real Estate Market : How Does it Impact Resale Value?

Jayson Ang – June 20, 2023 –

TLDR When navigating the Singapore property market, it's crucial to consider various superstitious beliefs that can impact your decisions. From...

Mandarin Top 5

5 Cons of Buying a New Development

Jayson Ang – March 4, 2024 –

Luxury properties in Districts 9 and 10 of Singapore are highly coveted, and for good reason. From stunning views and...

All Buying Tips Opinion

7 Frequently Overlooked Questions That New Condo Buyers Should Ask At The Showflat To Avoid Any Regrets In The Future!

Jayson Ang – January 29, 2024 –

TLDR Newly launched condominium buyers face uncertainties about price changes, proximity to schools, construction methods, maintenance costs, elevator availability, commercial...