With $1.8M portfolio, can retire?

With $1.8M portfolio, can retire at age 55?

Someone ever asked if $2M portfolio can retire comfortably in Singapore? (and assume excludes our home asset).

I put in some numbers for clarity.  It is always easy to understand with illustrations.

But it assumes retiring at age 55, where one can draw out from our CPF Annual interest.

Generally, safely assume that $1.8M is distributed as follows, in 4 Taps:

CPF: ~$1M (our most valuable asset)

SRS: $100k (build-up for tax saving; lockup till age 62)

Stock Dividend:$500k

Endowment: $200k, with 3% annual cashback

One can achieve $3k p.m. for retirement passive income.

$950k cpf @age 55

RA: ~$300k (FRS: $198.8k ERS:$298k). No payout till age 65.

MA: $60k (assume don't touch $)

SA: $100k: $4k

OA: $490k: $12.2k

Total interest: $16k p.a. ($1.3k p.m.)

(oh ok.  Drawdown SA then OA, we assume SA: $0 after 6-years and no SA interest.)

srs: $100k (cannot touch till age 62). (After age 61, srs can takeover to contribute).

$500k @3%, Dividend: $15k p.a. ($1.2k p.m)

Endowment: $200k @3% cashback from age 55, $6k p.a. (or $0.5k p.m.)

Total passive income: $16k + $15k + $6k = $37k p.a. ($3k p.m.)

With $3k p.m. stable return, this person can retire quite comfortably, singly.

If supported by spouse portfolio,  the combined imcome is giving a fat retirement.

Once at age 65, when CPFLife kicks in, another $2.2k ~ $2.5k p.m. payout which helps buffer against inflation.

In addition, another inflation fighting tool is the SRS at age 62.

Lol.

Wait a minute, the more stock Savvy would say that 10% for stock dividend is possible. My 3% dividend is low-hanging fruit.

When one plans for retirement, we assume lower bar return, anything more would be a blessing.

GxGx (gongxi gongxi)