SINGAPORE - A real estate agent was so astute in speculating in properties that he bought and sold five homes for himself and made over $2.3 million when he was just over 40 years old.

Just before he got married, he was so flush with money that he bought a resale HDB flat and paid the $668,000 purchase price in cash.

The flat eventually became his matrimonial home and he later added a $3.2 million condominium unit to his portfolio.

Although he was self-employed, he was diligent in planning for his retirement by contributing to his CPF savings, which has a balance of over $620,000 as he hits 55 in 2025.

In addition to a healthy retirement sum, he has also amassed another $1.5 million in cash and stocks. With such decent savings, he could afford an expensive car, but he chose to drive a nondescript Japanese car worth $75,000.

As he was so prudent and careful in saving and investing his money all his life, it was not surprising that he fought tooth and nail with his 41-year-old former wife, maintaining that the bulk of his wealth was accumulated before their 12-year marriage.

Although he works only part-time now and has a monthly income of $3,000 from renting out his HDB flat, he had been the main provider for his household and three young children. His former wife draws a monthly salary of $7,700 as a clerk.

As he owned the family’s properties and paid for most of the household expenses, the High Court allowed him to retain 70 per cent of the couple’s $5.5 million matrimonial assets. This was in addition to about $1 million in cash and CPF savings which he can keep, as he had saved this sum before the marriage.

This case provides interesting insight into what constitutes premarital assets and how good financial planning can make a difference in how your assets will be divided when the relationship turns sour.

The matrimonial home

Just months before he tied the knot, the real estate agent bought the resale HDB flat and registered it under his sole name as a single owner, as he was over 40 years old then.

After their marriage, the couple lived there for more than eight years and all three of their children spent their childhood years in that home.

As the flat, which is worth $900,000 now, was bought and paid for entirely before the marriage, the man argued that it should be kept out of the matrimonial pool, as it was a premarital asset.

But High Court Judge Choo Han Teck disagreed and said: “This flat cannot be described in any way other than as a matrimonial asset.”

In some past cases, the courts had chosen to divide such assets in an equitable manner, such as by assigning a smaller value for cases involving properties that were used as matrimonial homes for a short duration lasting only about a year.

Justice Choo noted that in this case, the flat had been used as the family’s matrimonial home for a much longer period, and there was no reason to treat it differently. So its entire value was included in the pool for sharing.

The risk of holding properties separately

To avoid paying the additional buyer’s stamp duty (ABSD) for his condominium unit, the man paid for the property but allowed his then wife to hold it in her name.

In all, he had paid almost $2 million for the property.

As the unit was held in the wife’s name, it would be practically impossible to argue that it would not constitute a matrimonial asset.

If he had chosen to buy the property with funds he had saved before the marriage and then held it in his own name, he might have stood a chance of convincing the court that the property belonged to him solely.

But doing so would have meant having to pay the ABSD, as he already owned the HDB flat.

What this means is that home buyers should not just look at not paying taxes as the primary goal when investing in properties, because letting someone else hold their assets could lead to unexpected consequences that could cost them a lot more.

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Premarital funds

If a couple had got married soon after they started working, the bulk of the savings in their CPF and bank accounts would be considered in any matrimonial split in a divorce.

In such cases, they could ask for some funds to be excluded if they can show that the money in certain accounts was given by their parents and these accounts had been kept separately from other matrimonial assets.

In this case, the man was already very cash-rich before he got married and he wanted his premarital funds to be excluded from sharing.

For instance, the balance in his CPF account during the divorce was about $624,000 while the balance at the time of the marriage 12 years earlier was about $253,000.

This meant the $253,000 should not be considered as matrimonial assets, and the court included only the amount of $371,000, which was saved during the marriage, for sharing.

As for his cash savings, the man had kept the bulk of the money that he earned before the marriage in a joint account with his then wife.

During the divorce, the account had $937,000, which was claimed by his former wife. But he was the one who managed the money and had used it to generate interest income, which was not directly used for the family expenses.

Justice Choo found that the man did not refer to the money as the family’s wealth and there was no evidence he had treated the fund as matrimonial assets.

“I thus accept that a significant portion of the $937,000 is likely to have originated from the husband’s premarital funds,” the judge said.

Since it was not possible to determine how much money the man had before the marriage, Justice Choo allowed him to retain 80 per cent of the balance, or $749,600, and put the remainder, $187,400, into the matrimonial pool for sharing.

Excluding the man’s premarital funds and CPF savings, the court found that the couple had more than $5.5 million in assets to be divided between them.

As the bulk of these assets came from the man, the court found that 91 per cent of the direct financial contribution came from him while his former wife contributed only 9 per cent.

As for indirect contribution, the court rated both parties as equal because the man, who worked part-time, also helped to take care of their three children in addition to footing most of the household bills.

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The overall ratio was therefore about 70 to 30 in the man’s favour.

This meant that he would get $3.85 million from the matrimonial pool, with his former wife getting $1.65 million.

He wanted her to transfer their condominium unit back to him, as her entitlement was just about half its value.

Justice Choo left it to the couple to decide who should get what based on their shares, noting that they have the option to apply to the court again if they could not agree.

The lesson here: Main breadwinners of families need not worry about being short-changed if they are diligent and prudent in managing their assets.

Check out Invest editor Tan Ooi Boon’s new book – Retire With More Money – at stbooks.sg

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Tan Ooi Boon writes for and oversees the Invest section of The Straits Times.