ChannelNewsAsia reported the findings from a recent retirement study done by global information and media firm The Nielsen Company. Frankly speaking, I have not done any retirement plans (except insuring in a few life insurance plans) as I thought it’s still too early for a guy who is in his late 20s to start worrying about his retirement egg.
However, I was pretty shocked to read close to a fifth of Singaporeans surveyed feel they need a huge sum of more than S$1,000,000 to retire comfortably. When I saw the figure, I began adding up the possible costs and factoring in the inflation rate to try to arrive at a more reasonable figure but I can’t. There are just too many factors to consider.
How much is enough?
I believe everyone wants to maintain his living standards upon retirement or at least not suffer a huge drop in living standards. There are too many things which I feel are important in my future consideration on how much I would need for my retirement. Top on the list would be the variable medical costs.
If you look at how rapidly the medical costs are increasing in the recent years, you would worry about how much you would need for your entire twilight years. Yes, my medical insurances could cover part of the total amount I need but I feel it would still be inadequate. I think it would be difficult to determine how much I would really need until I’m in my 40s and nearer to my retirement years. Judging from my health status and the average medical costs then, perhaps I could make a clearer and better gauge of the portion of my savings I need to set aside for it. Right now, I feel financing my insurance policies is all that I need to do.
What about the remaining amount of money I need for my retirement piggy bank? Well, first I think I would need money for my daily subsistence, hobbies like sports (if I could still move then) and movies, travel, transport costs, SCV cable and internet, water, electrical and phone bills etc. Perhaps S$600-800 a month would be enough. That’s of course based on the current money rate and prices. We all know how prices can shoot up easily, right?
When to retire?
Ah that’s a million-dollar question which our million-dollar ministers have answered some time ago. Not the 67 years of age which they have suggested. It’s too late for people like me who wants to retire earlier and enjoy my remaining years. Retiring at the age of 60 seems more reasonable for me. But I think I would set a timeline probably at the age of 55 for my retirement saving plan just in case there might be a sudden loss of income after that due to some unforseen circumstances. So if that’s the case, I would be left with only around 25 years to save up.
Looks like I really need to look for a financial advisor and start my retirement plan soon.