I got the email a few days ago about the StashAway SG Income Portfolio that people have been writing about online. While we are big supporters of StashAway as a Singapore robo-advisor choice, this SG Income Portfolio does not appeal to us at this stage. However, it might be more suitable for other people so you never know.

These are the reasons why we are not considering the StashAway SG Income Portfolio. The minimum account balance is S$10,000 and this can be quite a lot to invest with from the beginning at one time. Especially when the equity markets have started climbing again recently after the dip. Meaning the entry prices of the ETFs might be rather high.

The StashAway SG Income Portfolio allocation is about 54% in Bond ETFs, 35% in REIT ETFs and 10% in Equity ETF. I reckon it’s too heavily weighted in Bond ETFs, which is probably causing the projected income to be quite low at 3.75%. Even though the distributions might be regular over the year due to its ETFs selection.

The StashAway SG Income Portfolio can be replicated at one time manually using our own brokerage accounts because of the big amount to be invested. In fact, it can also be replicated automatically over time using the OCBC Blue Chip Investment Plan (more ETFs choices) and to a lesser extent the POSB Invest-Saver (less ETFs choices).

The StashAway SG Income Portfolio allocation is also too restrictive because we might want a higher allocation of REIT and Equity ETFs compared to Bond ETFs. Anyway, it’s a good start but will probably require more tinkering with to cater to more people. For example, remove the minimum account balance and allow for a higher weightage of REIT and Equity ETFs compared to Bond ETFs.

This is still a good exercise to go through because it made us re-evaluate our own asset allocation as well. Currently, our total assets split is at 51% cash, 19% investments and 30% retirement funds. I know it’s conservative and this is after us setting up our automatic monthly investments a while back. We have also been making manual investments to utilise our cash.

Having too much cash on hand is not a bad problem to have. Especially with the higher expenses expected when the baby comes along. But we decided to increase our automatic monthly investments to utilise more of our monthly cashflow. Over time, this should result in our cash proportion going down and investments proportion going up. This should be a better long term asset allocation position for us.

I have a younger colleague who started investing with Smartly and StashAway (Singapore robo-advisors) about the same time as my wife and I back in 2017. She invested a lump sum of about S$1,000 with each of them and didn’t contribute any further cash funds into her accounts.

To date, my colleague’s account returns are negative and she doesn’t understand why that’s the case. She’s now turned off investing with Singapore robo-advisors and recommends against them with our other colleagues.

I have another older colleague who heard about Smartly and StashAway but didn’t invest with these Singapore robo-advisors because she doesn’t understand them. In her own words, she prefers real estate such as residential property because she can see and touch it.

This is just within my department, which is a small sample size of the population in the bank that I work in. But it’s clear that there’s more work to be done in terms of promoting robo-advisors in Singapore. Even when you read online comments on forums about them, people are complaining about their negatives returns, high fees and saying stuff like they are worse than savings accounts.

I’m not saying Smartly and StashAway are perfect as investment tools because there are flaws with these Singapore robo-advisors. The key is to understand whether they fit within your investing strategies before you write them off or invest with them.

Please don’t disregard or start investing with Smartly and StashAway just because people in general (or even financial bloggers like us) say or do so. It’s the worst thing you can do.

For time-strapped corporate employees like my wife and I, Smartly and StashAway works well. Our total monthly automated funds transfer into both of our accounts is about S$2,500. It’s a good way to gain exposure to global equities regardless of whether the markets go up or down.

When the markets dip or crash, we manually transfer funds into both of our accounts. This can total up to a few hundreds or thousands depending on the extent of the downward movement of the markets.

This Dollar-Cost Averaging (DCA) and Value-Cost Averaging (VCA) component is an effective hedge against the Market Timing component of our total asset portfolio.

Most importantly, it frees up my personal time to focus on the things that matter to me. Family, friends and work. Our jobs remain essential to us because this is the one area we derive all of our active income from (salary) and spend most of our day at (12 hours from the point we leave our door at home in the morning to the point we step back through in the evening). We spend just as much time with our colleagues as well.

Since my wife and I are more suited to be corporate employees than being self-employed for now, we are much better off keeping ourselves focused on being in more positive job environments. This will go a lot further in keeping ourselves happy than worrying about our investing strategies.