I have been wondering lately about this issue. Why am I asking myself? As a person who is approaching 50 and does not have an income at present, I need to be strategic in allocating my assets. My concern is that if I invest too much in equities, a big crash could put me in a difficult situation because I still require cash flow to pay for mortgage and bills. There is no assurance of dividends being there when the market turns. What if some of the counters I have cease to distribute or even go bankrupt? So it's important to maintain a portion as cash/bonds, serving as a buffer to sustain me in times of need. Plus, the ability to buy into distressed companies and wait for them to recover is a must-have skill set for investors like myself. Currently, I am at about 67% allocation for my own portfolio and this becomes 50% when adding cash from my spouse's funds. While I will maintain a balance of 70% equity/equities ETF allocation for myself, I will put a hard limit of 70% combined with wife's funds to prevent me from being overweight in stock market. If the value of equities exceed the 70% hard limit, I will take profits and convert them into cash/bonds/SSS/T-bills/FD accounts.
I think for SA, my balance is considered "self-sustaining" as the 4% pa for SA could ensure my balance will continue to meet the FRS requirement every year until I reach 55. from CPF website, my SA balance already exceeds FRS for 2024. Every year, the FRS increases a little for inflation. E.g. the FRS for 2025 is 3.4% increase compared to 2024. But SA interest rate is 4%, so as long as you already reach FRS amount for current year, you will be fine I think, even if you stopped working (i.e. SA stops having contribution)
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