How to generate another RA tap?

 How to generate another RA tap?


Savings have to be deliberate intention and discipline; putting aside the money or reinvest the cashback and let it compound.

My learning from my colleague single policy:

*Single $100k @6% (quite decent dividend/interest) put aside for 20year.
a. $100k×(1.06^(20) = $320k maturity sum
b. Then withdraw it over next 20-years; $100k×(1.06^(20)÷(20×12) = $1.33k p.m.  It gives $1.33k p.m. every month for 20-years.

c. My colleague chose to save $280k total !!
age 48 to 55yo.  He started late and hence shorter runway to compound.

*$280k ×(1.05^(10)÷(10×12) = $3.8k p.m.  But it is still good to enjoy $3.8k p.m. from 65 yo to 75yo.

My Takeaway
1. Be it any saving instrument, stocks or endowment or CPF-SA, build up and reinvest or compound it, the principle sum has to be of bigger sum like $200k or $300k portfolio. (The bigger the better, just no quick return and get scammed.)

Small portfolio, small outcome.

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