Happy ending to hunt for better rates

Happy ending to hunt for better rates

Design director Raymond Kwa's busy work schedule does not permit him to take long vacations these days, so one of his dreams after retirement is to be able to travel frequently.

The owner of creative agency Compassage Design says: "I never had the chance to visit Europe, because I don't have so much time. If I am still healthy, which is most important, of course (I would)."

Mr Kwa, who is in his mid-40s, has been putting aside a sum of about $1,000 monthly in his bank account, but started concretely planning for retirement only recently.

"It was quite a coincidence. I was just looking around for something with better interest rates because, you know, bank rates now are close to zero, and someone approached me with a plan," said Mr Kwa, who bought an AXA Retire Happy plan.

He will put in about $30,000 annually and start collecting monthly payouts from age 65 for 15 years.

Mr Kwa also hopes that in the future he can purchase an investment property, which will provide him with a second stream of passive income in the form of rent in his later years.

He already has some investments in unit trusts, bonds, gold and fixed deposits.

While he has two teenage children, Mr Kwa does not want to burden them with supporting him and his wife in the future.

He estimates that he and his wife will need $3,000 to $4,000 each to be able to sustain their current lifestyle, based on back-of-the-envelope calculations.

"The cost of living continues to increase, and I think it will be very challenging for kids in the future to even make enough for themselves. I think the concept of depending on your children in retirement is really something of the past," he said.

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