My Financial Goals

I believe in beginning with an end in mind to have a clear vision of desired direction and destination to work towards to, so I'm penning down my current financial goals in mind which are subjected to change according to how I later shift my priority and focus in life.

1. Build a portfolio that generates passive income to provide for my parents, my future family, and myself

Being the only child, I am blessed with the responsibilities to take care of my parents. While my parents are really hardworking people, they were not financially savvy thus making some costly mistakes over the years. They also contributed to the family so much that they did not prepare adequately for their retirement. Thankfully, even though my parents are no longer in tip top health conditions, they still live a healthy and active lifestyle, which I hope will buy me more time to build my portfolio so that when the time they need financial support and medical treatment comes, I will be able to give them a worry-free retirement and the best treatment available. 

There's only so much time we have on Earth, I want my parents to be with me a little longer, and I want them to be able to enjoy their retirement.

Someday in future, I will marry the person I love and build a family of my own. By then, I will want to be able to spend more time with my family, provide the best that I can think of to prepare my children for their future, all while not causing a financial burden to my significant other. In order to be capable of these, I will need to have enough passive income to cover the family expenses so that I can have work flexibility, maybe even a choice to walk away from work if my family ever needs me to.

2. Be sufficiently prepared/ insured against illness and medical bill

It's no news that medical expenses are rocket high that even after subsidies you can still get an unpleasant bill shock. In the past year, three of my grandparents were hospitalised, and both my parents had to undergo a surgery. It was a blessing that my parents, together with their siblings, could manage the medical bills for my grandparents and my parents could afford their surgeries on their own, therefore didn't need me for any financial support. 

However, these events rang the alarm in my head. My mom's surgery was paid entirely in cash because of inadequate insurance. She also does not have a hospitalisation insurance at all because of a medical history that all insurance providers deemed too risky to provide coverage on. Luckily, my mom did not need to be warded after that surgery, thus sparing us the hefty hospitalisation fees. Nonetheless, this is a ticking time bomb that I will need to prepare for.

In addition, unlike my parents who have siblings to share the financial commitment, me being the only child means that I will be the only person to support both my parents in the future. For now, I will want to make sure that my family are insured as sufficiently as we can.

3. Own a fully paid up free-hold property in Singapore

I used to think that having a fully paid up property, even if it's a HDB, will be enough. I never felt the pressing need to achieve this until I had a conversation with a friend, and spotted some relevant ads on Property Guru with property on sale at ridiculously cheap prices. No, it's not haunted. Worse, the remaining lease on the property is only 15 years. That means that the property, no matter how big, cheap or prime location it is, will be of no value in 15 years. It doesn't matter if you own a HDB or a condominium, once the lease is due, all the money you have put in over the decades goes poof and you are left with nothing. I'm not sure what you'd feel about it, but I think that that's a tragic ending to my hard-earned/smartly-invested money.

Hearing the benefits of en-bloc, some of my friends actually went to buy resale HDB flats in matured estates that are over 40 years old, in the hope that in 10 year or so the government will enbloc their area for redevelopment, lavishing them with the various incentives as well as the opportunity to get a new house. What they fail to realise, is that while this is entirely possible, there is also a chance that their clusters of flats are not in the next few decades's redevelopment plan, and their property's value will eventually diminish to zero as time goes by.

Of course, getting a free-hold property is not entirely risk-free at all, but at least, if you were forced to give up your home one day, you are sure to be compensated at a fair market value, no matter how long you or your descendants have owned the house.

4. Be a CPF Millionaire

It's not that I'm giving up to be an exclude-CPF millionaire, but I want to still stand a chance to be a millionaire and have my most fundamental basic needs taken care of in case I somehow managed to screw up my finance along the way. I did the math and to my surprise, it is entirely possible that I can have over a million dollar in my CPF account by 55 years old, and even  over two millions if I choose to let it compound for another 10 years, as long as I dutifully contribute to my CPF up to the annual limit every year till I'm 55 years old. Once I reached 55, depending on my financial situation, I will then decide if I need the money at that point of time, or do I already have a decent portfolio that generates enough income for me to live and thus I can afford to let the money compound for another 10 years.