Colleague Dilemma: $100000


Recently my colleague and I had a discussion on different types of assets class & which is the best yielding assets to invest in. In the midst of the conversation, he told me that he has $100,000 but not sure where to park his money at.It seems that "有钱也会有烦恼“。

He is 35 years old, married and have a kid .He has max his CPF SA to FRS of $161,000.

He also invest in Singapore Savings Bond & nearly reach the $100,000 limit. However the 1997 CLOB crisis & 2008 Sub prime crisis which he lost heavily in Lehman mini bonds makes him wary of investing in equites again.

I told him about the risks & rewards by investing in equites & strongly encourage him to go for blue chips to grow his wealth if he willing to takes some risks to invest in equites. I told him I hold a stock that will yield abt 5.3% dividend yield  & have a room for further growth & compare the yield between Singapore Savings Bonds & the stock I mentioned to him. Of course we should not compare stocks & bonds but I want to show him how fast he can grow his money if he willing to take risks.

Singapore Savings Bond yield about 2.4 % on average & the stock yield about 5.3%. By using the rule of 72, it will takes him about 30 years to double his money if he invest in SSB & 13.5 years if invest in stocks.

This enlighten him immediately but I remind him the risks of investing in stocks compare to risk free SSB.

A digression from the topic , on 1/9/2018, I went to Eric Zhou concert in KL & this is my first time attending the concert ,the atmosphere is high & the fans never fail to impress me with their shouting & the person who accompanied me to the concert is someone I like very much. Below are some of the photos




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