can help you RETIRE AT AN AGE U WANT !.... or at least bring you closer to it! Will you retire at 40?, 55? or 70?
I found this true in a REAL life person - a Dr. Tham Wai Mun retired at 40s - highlighted in the attached ST article dd. 24 Feb 2013.
To appreciate my analysis below, you have to read the ST article (all 3 portions - actually from same article)-
Dr. Tham is able to retire at 40 because :-
1.She invested in good endownment and critical illness insurance plans! 7 Insurance in total, plus some other assets - owner occupied property, funds, some shares and foreign currencies.
Being a prudent saver, I believe her riskiest was on property/land-banking - see her 'Worst & Best bets".
She cited her best bets as - Insurance policies; the Triple coverage for peace-of-mind - and Compound interest, helps beat inflation with excess returns.
(being a single and does not own any car, her inflation is at most 2% averaged over the years)
2. Being single and very prudent in her spending, she probably saves 2/3 of her reasonably well-paid NTU salary for about 20 years (assuming she started work in her early 20s, she would have work 20 years by 40s), and can retire for 40 years (40 to 80 years old).
Before you 'protest' to what i say - saving 2/3 salary; this of course includes her CPF, insurance premiums,
plus her additional 'side' part-time income help pays for her expenses.
3. Finally, what helps her to retire at 40s is her perspective on what is "retirement".
To her, retirement is charity work and a simple lifestyle - by saving about 2/3 of her income she is able to have - the same lifestyle over twice her working years!
To many of us, especially those with families/children, to save 2/3 of income is almost impossible.
But what about saving 1/3 of your income ? And by investing in safe instruments, retiring at 60 for another 20 years is not an issue!
I meet many people who tells me that Insurance plans returns of 3-8% is too low (from endownment to Investment-linked), but they forget that insurance are classified as lowest risk next to cash deposits and 'blue-chip' currencies but yet with much higher returns!
Finally, may I add that Financial Planning is 'Not Difficult' yet it varies with each individual needs. This us where Financial Advisers knowledge and passion counts- to help you.
If you are keen to know more, reply me here or an sms me. I hope to hear from you.
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