Quora Answer: Can You Make a Living through Investing?

The following is my answer to a Quora question: “Can you make a full-time living through investing?”

Yes.  Most people who try will fail.  They fail for the same reason.  They mistake excitement for income.  Define a living first.  Take S$8,400 a month, which is about S$100,000 a year.  At a blended 3.4 per cent, you need S$3 million.  Anyone who promises that income from S$300,000 is selling something.

The Singapore Advantage

Singapore does not tax capital gains.  Dividends from Singapore-resident companies are tax-exempt under the one-tier system.  Foreign dividends that individuals receive are generally not taxable, unless they come through a partnership in Singapore.

The catch is the Inland Revenue Authority of Singapore.  It applies the “badges of trade”.  Frequency, holding period, financing, and whether trading is your main income all count.  Trade as a business, and your gains become income, taxed at up to 24 per cent.  A full-time investor who churns daily invites the audit.  Buy, hold, and collect.  Boring is a tax strategy.

If a company holds your portfolio, check section 10L of the Income Tax Act 1947 first.  It taxes certain foreign-sourced disposal gains that entities receive in Singapore.

The Rate Reality

Cash pays little.  The October 2026 Singapore Savings Bond pays 1.65 per cent in year one and 2.32 per cent on average over ten years.  The six-month Treasury bill cleared at 1.90 per cent on 8^th October.  Core inflation was 2.2 per cent in August.  That is a negative real return.  Cash is a parking space, not a plan.

CPF does better.  The CPF Board confirmed on 22^nd September 2026 that the 4 per cent floor on Special, MediSave, and Retirement Account savings runs to 31^st December 2027.  The Ordinary Account earns 2.5 per cent.  Treat CPF as the guaranteed leg.

The Comfortable Strategy

For example, you can build five layers:

- Hold S$300,000 in six-month T-bills at 1.9 per cent.  That earns S$5,700.

- Hold S$300,000 in Savings Bonds at 2.32 per cent.  That earns S$6,900.

- Hold S$900,000 in Singapore blue chips, led by the banks, at 4.5 per cent.  That earns S$40,500.

- Hold S$450,000 in Singapore real estate investment trusts at 5.8 per cent.  That earns S$26,100.

- Hold S$750,000 in accumulating global equity funds and sell down 3 per cent a year.  That yields S$22,500.

- Hold the last S$300,000 in gold.  It yields nothing.

This is for a conservative investor.  The total is S$101,700 a year, or S$8,475 a month.  The withdrawal rate is 3.4 per cent.  The S$600,000 in cash and bonds means a dividend cut forces no sale.  Spend the income.  Rebalance once a year.  Never sell in a panic.  The yields are indicative.  They move.

The Tax Leaks

The United States withholds 30 per cent of dividends paid to Singapore residents.  Singapore has no treaty with Washington.  US estate tax also applies above US$60,000 of US-situs assets, at rates up to 40 per cent.  By my calculation, a US$200,000 portfolio of US-listed ETFs creates about US$41,800 of estate tax.  Your beneficiaries meet the Internal Revenue Service before they meet your will.

Irish-domiciled UCITS funds fix both problems.  The US-Ireland treaty cuts withholding to 15 per cent at fund level.  These funds are not US-situs assets.  CSPX and VWRA are the usual examples.

Preferred Sectors

Banks.  DBS, OCBC, and UOB form more than half of the Straits Times Index.  The SPDR STI ETF returned 26.3 per cent in the first nine months of 2026.  OCBC posted a record net profit of S$4.2 billion and raised its interim dividend 15 per cent to S$0.47.  DBS declared S$0.66 plus a S$0.15 capital return dividend for the quarter.  UOB lags, with China property exposure and net interest income down 4 per cent.  Prefer banks that grow fee income.  Falling rates squeeze the rest.  Concentration is the risk.  DBS and OCBC alone make up about 38 per cent of the STI ETF.

Real estate investment trusts.  The sector’s forward yield is 5.8 per cent, with units trading near 1.0 times book value.  The S-REIT index is down 8.2 per cent this year while the STI is up 22.9 per cent.  S-REITs must distribute at least 90 per cent of taxable income.  Favour low gearing.  Favour industrial and healthcare assets.  Hold data-centre REITs, such as Keppel DC REIT, in moderation.  They depend on the AI spending boom.

Defence and marine engineering.  DBS Group Research expects ST Engineering, Seatrium, and SATS to support index earnings growth.  Yangzijiang Shipbuilding returned 56.2 per cent in the first nine months.

Gold.  Hold 5 to 10 per cent as ballast.  Gold is near US$4,350 an ounce after the Federal Reserve’s September hike.  Central banks bought a record 288.9 tonnes in the second quarter.

Global equity.  Cap the US share.  The Magnificent Seven are about a third of the S&P 500.  Reuters, using LSEG data, shows US$4.3 trillion of corporate bonds maturing between 2027 and 2031.  Use no leverage.

The Speculation Tax

The STI is up 22.9 per cent this year, against a decade average of 5 to 7 per cent.  That is weather, not skill.  Do not mistake it for talent.  Speculation ends badly, and Singapore has the record to prove it.  Nicholas William Leeson was head derivatives trader at Barings Futures Singapore.  He bet on the Nikkei and hid losses in account 88888.  The losses reached £827 million, twice the bank’s available capital.  A 233-year-old bank collapsed.  Leeson served time in Changi Prison.

The penny stock crash of October 2013 is the retail version.  Blumont Group, Asiasons Capital, and LionGold Corp had surged at least 800 per cent in nine months.  The Singapore Exchange suspended them on 4^th October 2013.  About S$8 billion of market value vanished within days.  One investor had put S$120,000 of his retirement savings into Blumont at S$2.40 a share.  The High Court later convicted John Soh Chee Wen and Quah Su-Ling of orchestrating the scheme.  Soh received 36 years and Quah 20.  Both stocks had come with tips.

Basic Advice

Use a financial adviser.  I stand by that.  The start-up route stands, too, but with limits.  Keep private deals to 10 per cent of the portfolio.  They can pay well.  They can also pay nothing.

A living from investing is possible.  Start with S$3 million, a withdrawal rate near 3.4 per cent, and the discipline to leave it alone.  The market will offer you excitement.  Decline it.  Excitement has a long record of beating investors.

---

Terence Nunis | Executive Chairman, Equinox Zenith | Author, The 1% Playbook: The Billionaire Cheat Code