I’m by no means a certified financial planner, nor had I acquired any form of paper qualification in this field. Something just came pop up in my mind, and we just had this discussion on this topic, and I though it might do some good to those that are interested. This is just the tip of the ice berg on the topic, but that’s what I know, and would just like to share with the rest.
So here it is. Enjoy ^_^
Everyone should have a retirement financial plan. For those that haven’t in their wildest dream ever though of it, it’s still not to late to start now.
A retirement plan is a plan that plans for when the time comes, and when you are no longer working, how much is the amount that you need to survive. Some named it differently -achieving financial freedom- which actually means the same thing as, maintaining the current lifestyle without having to worry about work.
Everyone wants to get rich, and when you ask someone how much money they consider rich enough, most of the time, they give you a blank look.
So, here, I would like to help you determine the rough estimate amount that you need to achieve your own retirement plan.
1. Decide your current monthly retirement income.
Assuming, that I’ve decided that I would need a monthly income of $1000 right now, at time moment, to retire comfortably. This $1000 is excluding the current car installment, housing loan payment, etc. It’s just the amount that you actually need to pay off your food, electricity, and other expenses.
2. Calculate the amount u need right now to retire.
If u need $1000 a month right now, and the bank is paying an interest rate of around 4%, then you would need $300,000/= to achieve that. With $300,000 sitting in a 4% FD, that would generate u $1000 every month. This will be the amount that you can retire, ONLY IF u have that money right now.
3. Decide when you wanna retire.
If you are currently 30 years old, and would like to retire comfortably at the age of 50, then you have 20 years till retirement.
4. Calculate the amount u need to retire in the future.
Alright, $300,000 is the amount that u can retire RIGHT NOW, at this instance, if only u have that money. Let’s say you don’t have, and you plan to retire in 20 years time, then the amount u need by then would no longer be $300,000, but something extra (due to the fact that u need to factor in the inflation rate).
To understand how the entire thing works, and get a free excel calculator of doing the whole calculation, visit here….
I have few hobbies, and normally my writings revolves around them:- – Trading / Investing in the stock market – Photography (preference in landscape, macro, and wildlife) – I\’m a cat/dog person. I have 3 cats. – Pc Games (especially warcraft 3 DotA Allstars) – Sports / Health stuff – Anything regarding Coffee – Programming(PERL in particular) – Music (I play the piano and guitar)
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