How am I doing? - Help yourself and everyone else series.

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#6
d.o.g. probably scared everyone off with his view. Big Grin
Let me share my 2cents worth to get the ball rolling.

Quote:2) If I buy the flat as expressed above and mortgage is 802 per month. Do you think at my age paying 802 for 20 yrs is risky?

That depends a whole lot on how much you're earning no? Also, are you paying rent now? If so, how much?

If the choice is a) pay 802 per month to own a place versus b) pay 802 per month to rent (excluding things like ppty tax and conservancy fees etc to simplify things)....I'm sure you get what I mean.

Quote:3) How do you think I am doing? Do you think I will reach my goals?
Whether you get there or not depends a lot on how fast you can grow your savings and investments no?

Anyway, assuming inflation rate of 3.5% p.a (if you believe in the concept of CPI in the first place that is), your $3500 of expenses today will equal some 80k per year.

If, big IF, you can grow your current portfolio at 5% p.a, with a dividend rate of 5% p.a and extra savings of 20+k (savings contribution increasing at 2.5% p.a) , then yes (from your starting point of 450k), you'll have a portfolio in 11 years time whereby you can draw 80+k a year in dividends to meet your monthly expenditures.

Of course, all this is an exercise on paper. You can expect lots of volatility a long the way and lots of curve balls that life throws at you. I'm not sure how useful this exercise is but Ive used it as a guidepost to see whether I'm closer to getting to where and I want to get to and I suppose it helps to have some map than no map at all.

Quote:4) Do you think I am prepared well, as I have small kids and I want to ensure they are not impacted by any layoffs or other income generating problems.

This is the tricky question. After all, you stated that your age is 40. Correct me if I'm wrong but that's the usual age where people start to get laid off and subsequently find it hard to gain employment with the same terms as before. That's assuming your occupation is one of that nature. If you're a professional i.e doctor. lawyer etc. or one with an iron rice bowl i.e govt sector, then less of a worry I suppose.

Otherwise, maybe you might want to start thinking about other streams of income?

Anyway, as d.o.g. said, the advice here is free and probably only as good as it's worth. I'm not a certified financial planner nor have I been through that much in life but I hope it might help you in any way it can.
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RE: How am I doing? - Help yourself and everyone else series. - by kazukirai - 12-10-2010, 09:42 PM

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