How many times have you pondered or asked …
“when can we retire?”
Or
“how much do I need to be able for us to retire comfortably?”
Fears
- What happens if I run out of money? I don’t want to rely on my family or have to go back to work!!
- What happens if there is rampant inflaton?
- How can I link my portfolio to at least be same as inflation?
What is that magical number?
Time
- What is the time horizon to get to the stage when you want to retire?
- How long will we need funds until we pass – as a 65 year old – expected lifespan is 23 years.
Your projected Expenses
Some of the factors that you need to consider?
- Your lifestyle during retirement (projected monthly expenses )
- How much money do you need a month to live
- How much do you want to spend on travel or If you get sick, how much do you need to take care of yourselves?
- How much re you Hobbies? Wine, Cars , Golf, Daily coffee and gym?
- Is there Any Debt that you need to cover
- Children and Grandchildren – how much cash flow do you need to support this ?
- How long you think you will live
- Do you want to leave anything to your family once you are gone
(ps – I have a brilliant budgeting tool for you to use… let me know if you need this!!)
Once you work out the age that you want to retire, and the magical number you need to be able to retire …… the next question is
What income will I need in retirement?
Non Investment Income
- Pension
- Annuities
- Business and real Estate
- Inheritance (genetic lottery)
Investment Income
- Asset Allocation
- Dividends, Rent and Interest
- Sale of Assets
- Equities
- Property
- Bonds
- Cash
Cash Flow is King and Queen
Once you identify what your monthly income and expenses are , and project your lifespan – do a cash flow!!
And then simulate the cash flow with what ifs!!
How to get there?
Identify the gap
Know your numbers
- Determine your time horizon from date of retirement
- Work out your projected expenses
- Work out your non- investment income
- Identify what investment you need to cover your expense
Once you know the numbers you need for retirement ,
- Identify what you have got – where you are today
- Identify what you need to retire and the time frame you have to get there
- Calculate the “Retirement GAP”
- Develop strategies on how to close that Gap
- Depending on the size of the Gap and the timeframe you need to get there…. You may need to leverage, work harder or marry rich?
- To work out these strategies ……
Find a Financial Planner that you Know Like and Trust to help you.
A good financial planner is like a good doctor…. You can only get to them via a warm introduction or a referral
The earlier you start to plan for retirement the easier it will be to close the gap !!
Do you know your Retirement Gap?
Let me know if you want me to refer you to an awesome financial planner !!
