Pensions Planning: The NUMBER

bendix

Mine is pretty simple. I plan on retiring to Thailand (where I lived previously) and I want to do it by the time I am 50 at the very latest. I'm currently 45.

I want to have enough to be able to own my house there (I currently have a city apartment which will be sold to buy the seaside house) and then enough to generate 150,000 baht (currently £3000) a month from the ages of 50-55, at which point I will hopefully have a pension pot capable lifting that income to over 200,000-220,000 baht a month and then I can glide along for the rest of my life, spending 60% of that and reinvesting the remaining 40% so that it never runs out.

Perfect.

Gatser

bendix wrote: »

... and then enough to generate 150,000 baht (currently £3000) a month from the ages of 50-55, at which point I will hopefully have a pension pot capable lifting that income to over 200,000-220,000 baht a month and then I can glide along for the rest of my life, spending 60% of that and reinvesting the remaining 40% so that it never runs out.

Perfect.

Sounds good.
If you are generating around £30k Net, I assume you need funds of circa
£1m (at 3% returns)?
Is it best to invest in Far East or back in Europe?

bendix

Gatser wrote: »

Sounds good.
If you are generating around £30k Net, I assume you need funds of circa
£1m (at 3% returns)?
Is it best to invest in Far East or back in Europe?

No . . i don't think funds of a million are necessary. 3% is ridiculously low. I'm getting much more than that currently from term deposits and I would be looking at a minimum of 5% income.

Easily achievable.

Gatser

I'd love to know which term deposits offer anything over 4.5%

Is that the case?

Gatser

... on the subject of Term Deposits, I see its possible to get 7%+ in Australia!

Is there a way to invest over there and enjoy those returns?

property.advert

bendix wrote: »

Mine is pretty simple. I plan on retiring to Thailand (where I lived previously) and I want to do it by the time I am 50 at the very latest. I'm currently 45.

I want to have enough to be able to own my house there (I currently have a city apartment which will be sold to buy the seaside house) and then enough to generate 150,000 baht (currently £3000) a month from the ages of 50-55, at which point I will hopefully have a pension pot capable lifting that income to over 200,000-220,000 baht a month and then I can glide along for the rest of my life, spending 60% of that and reinvesting the remaining 40% so that it never runs out.

Perfect.

The way things are going, you'll need more than that to live comfortably. You'll have to cover FX risk and Thai inflation, which, whatever they officially say, has been running around 10% I'd say for the last few years. You know what you can spend on an evening out to Walking Street :beer:

Gatser

It's one thing having some idea of what NUMBER we need for a happy
retirement, but one of the most difficult is planning (guessing):
(a) At what age will we expire?
(b) Will we need to provide for any old age care services?

Personally, (b) can be such a BIG NUMBER... that I am not even trying
to achieve it. I have seen examples of some old folk that have gone into care at 75 and are still there enjoying their lot at 95! All well and good but at a cost of around £25k pp pa.

Like all planning, we just have to make one or two assumptions (guesses!)

gallygirl

Gatser wrote: »

It's one thing having some idea of what NUMBER we need for a happy
retirement, but one of the most difficult is planning (guessing):
(a) At what age will we expire?
(b) Will we need to provide for any old age care services?

Personally, (b) can be such a BIG NUMBER... that I am not even trying
to achieve it. I have seen examples of some old folk that have gone into care at 75 and are still there enjoying their lot at 95! All well and good but at a cost of around £25k pp pa.

Like all planning, we just have to make one or two assumptions (guesses!)

What's happened to the Tories idea of paying 8k(?) as an insurance policy? Haven't heard anything about it. How would this work if there was a change of government - would it be honoured :think:

bendix

property.advert wrote: »

The way things are going, you'll need more than that to live comfortably. You'll have to cover FX risk and Thai inflation, which, whatever they officially say, has been running around 10% I'd say for the last few years. You know what you can spend on an evening out to Walking Street :beer:

Completely disagree on a number of points:

1) My FX risk is covered. Around 60% of my wealth is currently in NZ, 20% in UK and 20% in Thailand. I move it around to get the best balance between returns and currency coverage.

2) Thai inflation is nowhere near 10%, at least not on the things I buy. I first moved there seven years ago and was back for a couple of weeks last month. By your calculation, prices should have doubled in that time. They most certainly have not. I'm still paying 25-30 baht for street food, 500-800 baht for a good meal in a local resturant for two, and 1500-2000 for a foreign meal (of which I eat little).

3) I know dozens of retirees living very very well on 50-60000 a month. I aim to start with triple that, grow it, and still have enough to reinvest 40% of any income generated from investments.

As for Walking Street? Never heard of it . . . .

property.advert

bendix wrote: »

Completely disagree on a number of points:

1) My FX risk is covered. Around 60% of my wealth is currently in NZ, 20% in UK and 20% in Thailand. I move it around to get the best balance between returns and currency coverage.

2) Thai inflation is nowhere near 10%, at least not on the things I buy. I first moved there seven years ago and was back for a couple of weeks last month. By your calculation, prices should have doubled in that time. They most certainly have not. I'm still paying 25-30 baht for street food, 500-800 baht for a good meal in a local resturant for two, and 1500-2000 for a foreign meal (of which I eat little).

3) I know dozens of retirees living very very well on 50-60000 a month. I aim to start with triple that, grow it, and still have enough to reinvest 40% of any income generated from investments.

As for Walking Street? Never heard of it . . . .

Booze and birds kills Thai budgets. Add the cost of property to that and I think you would see over 10% inflation going back the years you mention. In any case, I would be more concerned with GBP/THB numbers which as you know are shocking, even for those who thought 60 was a baseline they would never need to approach.

I know street food is cheap and hasn't doubled in that time but it has gone up. Fuel has doubled and more.

I also know some who live on 60k or thereabouts. I couldn't and wouldn't. Your circa 200k is a great number I concede but you may need more than than for security if the !!!!!! really hits the fans and the wheels come off the cart.