The articles in the blog are intended for informational purposes only, with the aim of encouraging thoughtful discussions. The articles should not be relied upon as financial advice. Please read the important disclaimer at the bottom of the page before proceeding.

Part 1: Using ChatGPT to help with projecting Financial Freedom numbers

This will be the first of a 4-part series which explains the different concepts covered in the Excel financial freedom template that I have created. I used ChatGPT to help with writing some of the excel formulas and macros.

The template allows me to project how much I would need to invest to achieve financial freedom, based on different assumptions on investment returns, volatility, saving rates, inflation and expected salary growth. There are also different scenarios built in to the template, which allows me to account for various market environment, such as stagflation, which has high inflation and lower returns, and easy money (QE), with low inflation and higher returns.

I was curious to find out the likelihood of an average income fresh grad ($4.2k SGD in 2022) achieving financial freedom. Thought it would be interesting to share the results here.

The FI targets for this person (25 years old today) looking to achieve Barista FIRE are:

  • $3k SGD in monthly passive income (2022 purchasing power, inflation adjusted during projections)

  • 4.8% yield on investments via dividend paying stocks

The assumptions are as follows:

Salary and Expenses

  • $4,200 salary, take home of $3,360 (net of 20% CPF)

  • Expenses of $860 per month - I know this will be debatable, but let me kindly refer you to this article by Kyith's on Singaporeans spending <1k a month.

  • Person receives 2-3 months of bonus per year, which is used to pay taxes, travel expenses and one-off expenses

  • For the first 6 years, assume a +20% increase in salary every 2 years due to promotion / job change

  • For the following 6 years, assume a +15% increase in salary every 3 years due to promotion / job change

  • Salary increase set at 3% for all other years.

  • Savings rate kept constant over time - Monthly expenses expected to grow at the same rate as salary increases, from $860 to around $2k by the time the person hits their mid-30s.

  • Housing: Choose a reasonably priced one, where the monthly mortgage can be serviced by the CPF Ordinary Account contributions of the dual income couple.

  • Have received some preliminary comments that the salary increase appears unrealistic. Here are my further thoughts:

    The projections include 3 promotions/job switches in the first 6 years, then 2 promotions/job switches in the next 6 years. A total of 5, 3 times of 15% and 2 times of 15%. The rest are 3% annually.

    Based on this article on Seedly,


    For Managers & Administrators the median salary for early 40s is 9.5k today (115k annual) and 7.5k for Professionals (90k annual). The question should be what would a person in their 40s earn in year 2038 for these roles?

    If we apply a 3% adjustment for inflation per year, then in 2038 these people should be getting around 150k (Managers) and 115k (Professionals).

    In the example used, at 40 years old (i.e year 2038), the person would be projected to earn around 154k annually based on the assumptions above, so not too far off from the median expected salary for Managers/Professionals, if we adjust for inflation.

Investment Returns & Inflation

  • Projected portfolio return of 5% per annum, with 15% standard deviation (roughly aligns with the historical returns/std dev of MSCI ACWI)

  • To be conservative, max gain in a year is capped at +30%, while max loss is set at -50%

  • Returns are randomised with a normal distribution. This accounts for the sequence of returns which is often overlooked when projection investment returns. i.e, if you think you can get 5% returns yearly, people usually just compound this 5% directly without account for the sequence of returnsReal world returns don't behave like that.

    • Since we are investing consistently over a period of time, the sequence of returns matter. For example if the returns over a 5 year period are: +12%, +4%, +16%, +5%, -20%,The 5 year CAGR is 2.5%. Even if you swap the +12% and -20%, the CAGR remains the same at 2.5%.

      But if you invest a fixed amount across the 5 years, your ending amount would be different. Thus randomising the returns accounts for this.

  • Note: real world stock market returns exhibit fat tail distributions, which were not accounted for here.

  • Inflation is set at 2.5% for the base case. In the template, inflation can be adjusted based on scenarios, e.g. 5% in a stagflation environment.


  • Barista FIRE year determined when a portfolio yield of <4.8% can generate passive income of 3k/month, inflation adjusted.

  • Results based on running 200 simulations:

    • 73% chance to achieve Barista FIRE by 2038 (40 years old, works for 15 years)

    • 89% chance to achieve Barista FIRE by 2040 (42 years old, works for 17 years)

    • 97% chance to achieve Barista FIRE by 2043 (45 years old, works for 20 years)

Please watch my YouTube video above for a full walkthrough of the template. I will be discussing some of the concepts mentioned in the video in the coming weeks.

STI vs S&P500: Why I continue investing in Singapore


I want to begin by saying that there’s no “right” or “wrong” investment strategy – we are all investing based on our convictions, our beliefs, our risk appetites, how we perceive data and much more. I am not making a judgement of whether one investment strategy is “better” than another, because ultimately, we are all investing for the same goal – to make money.

In recent years, a popular line of thought is to simply invest in the S&P500. In this post, I share my thoughts on this concept, specifically looking at the implications for Singapore-based investors who may choose to pursue this strategy.

Personally, while I invest in the S&P500 (albeit not exactly, but via a Quality factor ETF), I don’t believe in putting all my eggs in the same basket. Thus, the intention of this post is to share why I continue to invest in the Singapore market, and have allocated a significant portion of my portfolio (~50%) to local stocks. Generally, people my age (mid-20s) tend to shun the Singapore stock market altogether. The post touches on the reasons why I continue doing so.

Recency bias?

I think there’s a bit of recency bias and hindsight bias when it comes to STI vs S&P500 debate. Let’s use the period from the turn of the millennium (year 2000) to illustrate this. From the chart below, the S&P returned 172% from 2000 (dotcom peak) till today, while the STI returned 56%. The S&P500 clearly did better.

STI vs S&P500, 2000 to 2023. Chart from TradingView.

But since we are looking at things from the perspective of the Singaporean investor, we have to consider the FX movements as well. In 2000 the USDSGD rate was around 1.70. Today, it is around 1.33. So in SGD terms, the Singaporean investor who invested in the S&P would have suffered a -22% FX loss.

And what about dividends? I am too lazy to get the data from 2000 till today, but generally the yield on the STI would have been 3 to 4% for the STI, compared to ~2% for the S&P. Over 23 years, this further narrows the outperformance of the S&P vs the STI.

Let’s further analyse the reference period into two separate periods. The first being from 2000 (dotcom peak) to 2010 (a year after the GFC lows), aka the “lost decade” for the S&P500. And the second, being from mid-2010 till today.

STI vs S&P500, 2000 to 2010. Chart from TradingView.

STI vs S&P500, 2010 to 2023. Chart from TradingView.

What is clear from the two charts above, is that the S&P500 hugely outperformed STI from 2010 till today, for sure. But in the decade before that (2000 - 2010, aka the “lost decade”) for the S&P500, the STI outperformed the S&P500. The S&P500 returned -22% from the dotcom peak till 2010, a full 10 years, while the STI returned +35%.  

The outperformance of the S&P500 vs the STI was supercharged only in the period post-GFC, when ultra-low interest rates propelled the S&P500 on a 13-year long bull run, during which the S&P500 gained 249%, against the STI’s 15%.

Going forward, I think it’s tough to say what will happen. On one hand, many of the best and most innovative companies globally are in the S&P500, which should continue to do well. But on the other hand, valuations for the S&P500 were rather stretched in late 2021 (and one may argue, that for the Nasdaq, sentiment was similar to the previous dotcom peak), and mean reversion is possible. Could the tech-frenzy in late 2021 be compared to the mania of 2000, and if so, what can we expect of the US market’s performance in the next decade?

I think ultimately one’s perspective in this issue depends on when they had started investing.

If you speak to a relatively young person (30s and below) who only started investing post-GFC, or worse still, only recently during Covid, then obviously during this timeframe the US market vastly outperformed the SG market. Hence, they will have the perspective of ignoring the SG market altogether.

But if you speak to the older folks, like people in their 50s and 60s, who have actually made good money in the SG market during heydays of the 1990s and 2000s, then they would tell you the exact opposite – you can do well in the Singapore market.

I think even if we look beyond the golden era for the Singapore market (when the economy was transiting from an emerging market to a developed market), there are some SG stocks that have continued to do well – DBS, Sheng Siong, Raffles Medical, Parkway Life Reit… just to name a few.

Maybe I’m biased, because I started investing 8 years ago, and took guidance mainly from my older relatives – hence the preference for value/dividend names. But again, it all boils down to your conviction, your beliefs and your perspective. Your money, your call.

Currency Risks

Currency risk is a huge consideration as well. Of course, the USD being the global reserve currency provides some comfort. But if we look at how some of the other major currencies have performed over the decades, it’s no surprise why some older Singaporeans (especially retirees) shun foreign denominated stocks.

You may hear older relatives mention how the GBP/SGD went from more than 3 in the early 2000s, to 1.6 today, or how the AUD/SGD dropped from 1.30 to 0.90 today. Anyone holding investments denominated in GBP or AUD would have seen 30% to 50% FX losses in SGD terms.

Thus, when Warren Buffet suggested that people only need to buy the S&P500, because that represents the “economy”, I think that’s more applicable specifically to US citizens. For US citizens, it makes sense to have 100% USD exposure if one is retiring in the US and have their cash flows / expenses entirely in USD.

But as a Singaporean spending SGD in retirement, I think it is more prudent to have at least a substantial part of your cash generating assets in SGD. Unless you’re retiring in a location where the USD is widely accepted (some tourist friendly, SEA locations), then having your entire retirement nest egg in USD seems risky.

We don’t know how the USD/SGD will perform in the long run, especially with geopolitical issues and such. Having your entire investment portfolio denominated in USD means that you’re betting on the US-led, unipolar world to continue, whereas having a globally diversified investment portfolio across multiple currencies may turn out better in the event the world becomes increasingly multipolar, leading to a decline in the USD’s dominance.

At this point I will suggest reading some of the research notes by Zoltan Pozsar on the US Dollar; there have been many people sharing these notes on LinkedIn. He shares some interesting analysis of the Russian-Ukraine war’s impact on the USD’s dominance.

If one is really adamant on only investing in a single ETF – then maybe the IWDA/VRWA/VT may be a more ideal from a diversification perspective. Although these are still denominated in USD, holding a globally diversified portfolio means that part of your FX exposure will be based on the underlying currencies of the global stocks in the portfolio.

Merits of the Singapore market

Let’s take a step back and appreciate the merits of the Singapore market. We don’t have capital gains taxes. We don’t have dividend withholding taxes. Valuations are generally less frothy (at least in recent years). These boring, mature companies usually pay a decent dividend.

Thus, I am investing in the Singapore market exactly with these merits in mind – to generate a steady stream of dividends for my early retirement. And the Singapore market has served me well for that.

The STI pays a stable dividend of around 4%, and going forward, even if STI has zero capital appreciation, and barring any catastrophic financial system meltdown, at least I get the 4% dividend yearly.

My approach

Having said the above, my current approach is to have around 10% in QUAL (SPY equivalent) and 10% in STI. As I’m only targeting a rather conservative 5% annualised return to hit my FIRE goals, I think I will be able to reach it, regardless of whether SPY outperforms STI in the next decade or not. Broadly, I still choose to having around 50% of my portfolio in SG investments (S-REITs, STI and SG dividend payers), while having exposure to the US, China and Developed Markets via other stocks/ETFs.

Therefore, will the US market continue to outperform the Singapore market, as it has done for the past decade?

Or, will the next few years of higher interest rates benefit the more “value” oriented Singapore stocks?

My answer is that I don’t know. But I for sure will not put all my eggs in the same basket.

Remember, past performance does not guarantee future returns.