Withdraw money from IBKR back to Malaysia and Singapore

Buy and hold forever, that’s the only strategy you need investing in ETFs

I should be talking about how to do this a long time ago. We have learned to fund IBKR (Interactive Brokers) from Singapore and Malaysia, now it is time for us to learn how to withdraw money from IBKR back to Malaysia and Singapore.

Yes, I plan to hold my USD portfolio for life or at least until my retirement. And then withdraw 3-4% percent every year after retirement. If the Trinity Study is correct, by mixing the correct percentage of bonds/equities ETFs, my retirement fund will be enough to support my retirement expenditure for at least 30 years if I only withdraw 4% or less every year.

My Backup plan

Currently, VUSD and VWRD pay about 1.5-1.8% of dividend per year. Since I also hold SGD denominated retirement portfolio mainly in Singapore REITs and banks and MYR-denominated portfolio in EPF and Malaysian REITs and banks, these holdings’ yearly combined dividends might contribute another 2% to my retirement fund, so in principle, I just hope I will not sell any single unit/share of my retirement portfolio after I stop working. I also put in place the three-bucket retirement strategy

So theoretically I can hold on to my retirement portfolios for infinite time and pass them to the next generation. Anyway, I still need to learn how to withdraw my fund just in case.

Today, I am going to show you a step-by-step guide to withdraw money from IBKR back to Malaysia and Singapore.

If you need to know how to withdraw your IBKR fund back to Malaysia, I would suggest you read Mr. Ng’s post HERE.

There are a few advantages of getting a Singapore bank account to receive your withdrawal from IBKR.

1. You can convert USD to SGD ( near spot rate) in the IBKR platform and only transfer back to a Singapore bank account.
2. The withdrawal is almost instant and there is minimal transaction cost involved. If you withdraw your fund in IBKR back to Malaysia in USD, this involves an intermediary bank and the cost is certainly higher.
3. You can’t convert USD to MYR in the IBKR platform because MYR is not a listed currency.
4. You would not receive calls from the bank asking you where the money comes from. I tried to transfer GBP 63 back to Malaysia from my IBKR and the Public bank called me asking me to email them my IBKR statement. I wonder whether I will get the same call if I transfer back GBP 63 million dollars ( just kidding). At the end of the day, I got back less than GBP 60.

So my advice to you, open a Singapore account if you are eligible. There are two ways of opening an account in Singapore if you do not work there.

Option 1

Travel to Singapore and bring documents verifying your income and job and just walk into any bank and let them know you are interested to buy shares and invest in Singapore. Let the bank knows you want to open an account. I am not sure whether this method still works. I used this method many years ago.

Option 2

Get a premier account in Malaysia.CIMB, Maybank, and HSBC premier accounts are good options. You need to have MYR250k to open this type of account. Once you have a premier account, ask your Relationship Manager (RM) to help you to open an account in Singapore.

It is getting tougher as well to open cross border account now using this method, but you can try if you have MYR250K in the bank.

Now I am going to show you how to withdraw your fund from IBKR back to a Singapore account.

Step 1: Log into IBKR

Log into your IBKR and click on Transfer Fund icon on your left and you will be directed to the screen of fund withdrawal.

Choose make a withdrawal as shown below,

Step 2: Fill up your receiving bank details

IBKR will prompt which currency you would like to withdraw, I would advise converting to the currency you want before your withdrawal, in our case, I opt for SGD. Use Bank Wire instead of GIRO because it is faster!

You need to fill up the details of the receiving bank. I use DBS, the swift code for DBS is DBSSSGSGXXX, no need to bother about the branch number because anyhow, you will get your money.

Once you set up your bank’s details, the next time will be easy for you because you can do it with just 1 click.

Step 3: Check your bank account balance

That’s all, wait for your money to reach your account. Usually, it takes less than 1 day. Fast and easy and Zero cost! You are allowed to do one transfer free of charge every month.

Conclusion

You can try to withdraw your fund from IBKR but listen to my advice, keep all your fund in IBKR until retirement.

Let compound interest works its magic. Keep investing monthly until you hit your retirement number!

#Addendum- Jan 2020– You can read ringgitfreedom.com post HERE about ways to open a Singapore account from Malaysia.