Tag: FIRE movement
Kevin O’Leary: Why Early Retirement Doesn’t Work
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
This whole idea of financial independence retire early doesn't work. Let me tell you why. It happened to me. On the sale of my
first company, I achieved great liquidity and I
thought to myself, "Hey. I'm 36. I can retire now." I retired for three years. I was bored out of my mind. Working is not
just about money. People don't understand this very
often until they stop working. Work defines who you are. It provides a place where
you're social with people. It gives you interaction with people
all day long in an interesting way. It even helps you live longer
and is very, very good for brain health. Staying stimulated is how people
live into their 90s. I'm not kidding. So when am I retiring? Never. Never. I don't know where I'm going
after I'm dead, but I'll be working when I get there too..
How To Retire At 30 Living Off Investments
Jason 0 Comments Retire Wealthy Retirement Planning
in order to live off of
your investments completely. And I know that the title of this video may sound crazy about retiring by 30, and there are a lot of people
out there selling a pipe dream of you can retire by 30
as long as you invest in this course, or go buy real estate and while that may work for some people I'm not here to sell you guys a course or to pitch you on any
kind of product like that. What we're going to
simply talk about here is how much money you need to have invested in order to live off of your investments and essentially not have
to work to earn your money.
And believe it or not, there's
actually countless people out there who have in fact
retired as early as 30 years old, by following this exact strategy
that I'm going to outline. So if this idea of retiring early and not having to work for your money is something that interests you. What I want to ask you
guys to do is go ahead and drop a like on this
video just show your support. I really do appreciate
that as it helps out with the algorithm and allows this video to get shared with more people. But what we're going to look
at in particular in this video is something called the 4% rule, and that essentially
shows you just how much money you need to have set aside, in order to live
off of your investments. Now you can in fact live off of different types of investments like real estate or the stock market for
example or a business that's providing income for you. But what we're going to use in this video as an example is a passive
stock market investment, and we'll show you exactly
how much money you need to have invested in order
to live off of that income.
So the goal here with this
strategy is to simply invest your money and have a large
amount of money invested and then you would
essentially be living off of the interest income or
the growth of that money without touching the principle. And as I'm sure you guys can imagine if you're not touching the principle or your initial investment, then your money could
foreseeably last forever. Now, the sooner you're able to retire is all based on how much
money you're able to save up and how little money you are
spending each and every month, and there's actually a
whole movement of people that are following this
exact strategy, and it's something out there called FIRE, and FIRE stands for financial
independence retire early. And there's a lot of
people who are doing blogs and videos and all kinds of
stuff about this concept, and there are countless
examples out there, of people who have retired
as early as 30 or even less.
By following these strategies. Alright guys so there's
basically three steps you have to follow in order to do this, and as I'm sure you can imagine, step number one is to be frugal or to spend as little money as possible, because ultimately what
you're looking to do is save and invest enough
money that the interest or the dividends, or
whatever the growth is pays for your monthly living expenses.
And as I'm sure you guys can guess if your monthly expenses
are $6,000 versus $3,000, you're going to need a
lot more money invested to cover those expenses. So being frugal and saving
as much money as possible is actually going to serve
two different purposes here. Well, number one, the
less that you're living on the more of your paycheck
you're able to save up, and the more of your paycheck
you're able to save up, the more you're able to
contribute to that freedom fund, which will eventually be paying for all of your living expenses. And then second of all by spending as little money as possible
every single month, you actually don't need
to save up as much money to potentially live off of the interest or the growth of your money.
And we're going to go over
those exact numbers right now. Alright guys so step number two
that you have to follow here is going to be a tough one, but that is going to be saving 50 to 70% of your take home income and again, if you're looking to
retire by 30 years old, let's say you want to work from 20 to 30, and then not work for
the rest of your life, you're going to have to take
some drastic actions here. And that is why you need to live off of a microscopic amount of money. And that's why step number
one is so important, by cutting down as much as possible on those monthly expenses. So people who are trying to do this, you're not going to see
them driving brand new cars, you're not going to see
them going on vacations, they're probably going to be,
you know, eating canned beans and doing campfires in the
backyard as summer entertainment. Not that there's anything wrong with that, but they are literally spending
as little money as possible, because they're focusing
on the long term picture of what they are trying to do.
So people who are following
this FIRE movement are often aiming to save 30
times their annual expenses, and that will allow them to
withdraw about 4% per year without basically touching that principle and that is where that
4% rule comes into play. And that is basically where you're able to draw from an account about 4% per year, and over a long period of
time based on the growth of that account and those investments, it shouldn't be chipping
away at the principle which should in theory
give you unlimited money. So what you're aiming
to do here is to lower your monthly expenses as much as possible. Figure out what it costs
you to live per year, multiply that by 30, and then
save up that amount of money by saving 50 to 70% of your
paycheck every single week or month, or however often
you are getting paid. Alright so now the question
you guys have been waiting for, just how much money do
you need to have saved up and invested to live off of that money following the 4% rule. Well if your annual expenses
are $20,000 per year, they would recommend having 30 times that amount of money saved and
invested, so $600,000.
If your annual expenses were $35,000, that number becomes 1.05 million. If you're somebody
spending $50,000 per year on your living expenses
you would need to have $1.5 million saved and invested,
and for the final figure here, if you spent $100,000 per
year on cars and housing and food and all of that,
you would need to have about $3 million to successfully
follow this strategy. So I'm sure this goes without saying guys, the best way to follow the strategy and to reach that retirement as quickly as possible is going to be
to keep your monthly expenses as low as possible. And just to put it in
perspective for you guys, every additional $100
that you spend per month, if you follow this is
an additional $36,000 you need to have set
aside in that freedom fund to support that $100 of monthly spending. So if you're serious
about this and you want to retire at 30, or even younger, you are spending literally as little money as humanly possible. Alright so the final step
to following this strategy is going to be passively
investing in the stock market. So most people following this strategy are actually following
the Warren Buffett style of passively investing in index funds.
And if you're not familiar,
index funds are basically a way for you to have diversified
exposure to the stock market. Where you're not essentially
picking what stocks are going to outperform,
you're just passively owning the entire market. So people following this strategy are not out there trying
to beat the market, they are not stock
traders or stock pickers they simply passively invest
in these low fee index funds, one of the most popular ones being VOO or the vanguard 500 fund. And essentially what you are doing, is buying a small piece of the 500 largest publicly traded companies out there, and all the different
dividends those companies pay are all collectively put together, and then you earn a quarterly
dividend from that ETF. And over the last hundred
years or so the stock market, on average, has returned
about eight to 10% per year. So if you were only drawing
4% from that account, based on historical data, you should never be
touching that principle over a long period of time.
And that is how you would
be able to live off of 30 times your annual income, if you save that money and invest it. Now that being said that
is the perfect segue into the sponsor for this
video which is Webull. So if you guys are
interested in getting started with investing in the stock market, this is a totally commission
free broker out there, meaning you're not paying
any fees to please trades with them and you can
purchase the Vanguard 500 ETF that we're talking about in this video right on that Webull platform, and not only that, they're
willing to give you up to two completely free stocks just for opening up an account with them. Number one, if you open the account, you're going to get a free
stock worth up to $250, and then when you fund the account, you'll get an additional
stock worth up to 1000.
So if you do the math there, that is two completely free stocks worth up to $1,250. Now I am affiliated with Webull, so I do earn a commission in the process if you use my link, but
if you guys are interested in grabbing two completely free stocks that is going to be down
in the description below. So finally, the last
thing I want to do here is to put all of this together, and go through a real
example of how you could in fact follow this strategy and even retire by 30. Now again, this is going to
require some very drastic saving because essentially you're trying to work for about 10 years of your life and then not have to work
for the rest of your life. So most people will never
be able to accomplish this, because of the amount of
sacrifice that is required, with that being said, let's go ahead and run
through the numbers now. So let's say you're earning
a salary of $75,000 per year from your job, and ideally,
you don't have any, you know school loans,
student loans, medical bills, or anything like that.
So you haven't gotten
sucked into the consumerism and you don't have like a brand new car so your expenses are as low as possible. And I know this sounds like
you know theoretical situation, but this was actually
about the same situation I was in, when I graduated
college I was 20 years old, now I was making about $68,000, so a little bit less, but I had no debts, I had no car payment,
and so I was somebody who could have potentially
followed this strategy. So after you pay your
taxes, your take home pay is going to be around $56,250. Now we know already in
order to pull this off, you need to save 50 to
70% of that take home pay in order to actually build up enough money to live off of that income. So we're going to assume
you are saving 70% of that take home pay. So you would need to live off of 30% of that post tax income, which
amounts to just over $16,000, or around $1400 per month. Now, is that possible? It absolutely is.
Is it easy? Absolutely not, you're certainly not going to be going out to the
bar and buying beers or going out to dinner,
you're probably going to be living in a tiny apartment driving an old car and eating at home for breakfast, lunch, and dinner. But if that type of
sacrifice is worth it to you for the long term picture, it is something you may
be willing to do yourself. So each year you would
be saving and investing a staggering amount of money, which is 70% of your take home pay
or just over a $39,000. And that is how you would
be able to pull this off, and assuming you kept that
cost of living the same at around $16,000, just over 16,000.
Your freedom number, or 30
times your annual expenses, would be just over $506,000. So, how long would it take
you to save up that money? Let's go ahead and answer that now. Well if you took that
$39,375 per year of money that you are saving and
invested in the stock market, earning 8% return, and
as we said, historically, it's an eight to 10% so we're going to go on the conservative side, well in 10 years at 8%
return career you would have $570,408.40, meaning you could then, if you kept those living
expenses the same, following that 4% rule, not have to work for your
money past that point. And just to circle back
guys what this really comes down to is the level
of sacrifice involved. Are you really willing to live
off of about $1400 per month, or do you want to have vacations and going out to get dinner
and things like that? So it's not people who are doing this that are out there traveling and dining it's people that are living
as frugal as possible and finding enjoyment
in other areas of life other than just, you know,
spending money on dining and things like that.
Now, is this a strategy I
would personally follow? Probably not because I
am one of those people that enjoys traveling, I enjoy dining, and I do spend a little bit
more than the average person, so my freedom number would be
multiple millions of dollars, but instead I follow the
strategy of earning as much as possible and saving a
lot of that earned money, and then eventually allowing
that to supplement my income by having that interest
or the growth of my money paying for a lot of
those things that I want. And believe it or not,
guys, there are honestly countless people out
there that have followed this exact strategy and
retired at 30 or less. One of the most well known people being Mr. Money Mustache, he has a whole blog where he documented this whole journey of becoming financially
independent and retiring early with both him and his wife.
So I'm going to link up his blog down in the description below
as well as a couple of other stories about
people who have followed this exact strategy and
retired at 30 or less. So that's going to wrap
up this video guys, thanks so much for watching. If you're new to this channel, make sure you subscribe and
hit that bell for notifications so you don't miss future videos, and I hope to see you in the next one..
Kevin O’Leary: Why Early Retirement Doesn’t Work
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
This whole idea of financial independence retire early doesn't work. Let me tell you why. It happened to me. On the sale of my
first company, I achieved great liquidity and I
thought to myself, "Hey. I'm 36. I can retire now." I retired for three years. I was bored out of my mind. Working is not
just about money. People don't understand this very
often until they stop working. Work defines who you are. It provides a place where
you're social with people. It gives you interaction with people
all day long in an interesting way. It even helps you live longer
and is very, very good for brain health. Staying stimulated is how people
live into their 90s. I'm not kidding. So when am I retiring? Never. Never. I don't know where I'm going
after I'm dead, but I'll be working when I get there too..
Kevin O’Leary: Why Early Retirement Doesn’t Work
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
This whole idea of financial independence retire early doesn't work. Let me tell you why. It happened to me. On the sale of my
first company, I achieved great liquidity and I
thought to myself, "Hey. I'm 36. I can retire now." I retired for three years. I was bored out of my mind. Working is not
just about money. People don't understand this very
often until they stop working.
Work defines who you are. It provides a place where
you're social with people. It gives you interaction with people
all day long in an interesting way. It even helps you live longer
and is very, very good for brain health. Staying stimulated is how people
live into their 90s. I'm not kidding. So when am I retiring? Never. Never. I don't know where I'm going
after I'm dead, but I'll be working when I get there too..
How To Retire At 30 Living Off Investments
Jason 0 Comments Retire Wealthy Retirement Planning
in order to live off of
your investments completely. And I know that the title of this video may sound crazy about retiring by 30, and there are a lot of people
out there selling a pipe dream of you can retire by 30
as long as you invest in this course, or go buy real estate and while that may work for some people I'm not here to sell you guys a course or to pitch you on any
kind of product like that. What we're going to
simply talk about here is how much money you need to have invested in order to live off of your investments and essentially not have
to work to earn your money. And believe it or not, there's
actually countless people out there who have in fact
retired as early as 30 years old, by following this exact strategy
that I'm going to outline. So if this idea of retiring early and not having to work for your money is something that interests you. What I want to ask you
guys to do is go ahead and drop a like on this
video just show your support.
I really do appreciate
that as it helps out with the algorithm and allows this video to get shared with more people. But what we're going to look
at in particular in this video is something called the 4% rule, and that essentially
shows you just how much money you need to have set aside, in order to live
off of your investments. Now you can in fact live off of different types of investments like real estate or the stock market for
example or a business that's providing income for you. But what we're going to use in this video as an example is a passive
stock market investment, and we'll show you exactly
how much money you need to have invested in order
to live off of that income. So the goal here with this
strategy is to simply invest your money and have a large
amount of money invested and then you would
essentially be living off of the interest income or
the growth of that money without touching the principle.
And as I'm sure you guys can imagine if you're not touching the principle or your initial investment, then your money could
foreseeably last forever. Now, the sooner you're able to retire is all based on how much
money you're able to save up and how little money you are
spending each and every month, and there's actually a
whole movement of people that are following this
exact strategy, and it's something out there called FIRE, and FIRE stands for financial
independence retire early. And there's a lot of
people who are doing blogs and videos and all kinds of
stuff about this concept, and there are countless
examples out there, of people who have retired
as early as 30 or even less. By following these strategies. Alright guys so there's
basically three steps you have to follow in order to do this, and as I'm sure you can imagine, step number one is to be frugal or to spend as little money as possible, because ultimately what
you're looking to do is save and invest enough
money that the interest or the dividends, or
whatever the growth is pays for your monthly living expenses.
And as I'm sure you guys can guess if your monthly expenses
are $6,000 versus $3,000, you're going to need a
lot more money invested to cover those expenses. So being frugal and saving
as much money as possible is actually going to serve
two different purposes here. Well, number one, the
less that you're living on the more of your paycheck
you're able to save up, and the more of your paycheck
you're able to save up, the more you're able to
contribute to that freedom fund, which will eventually be paying for all of your living expenses. And then second of all by spending as little money as possible
every single month, you actually don't need
to save up as much money to potentially live off of the interest or the growth of your money.
And we're going to go over
those exact numbers right now. Alright guys so step number two
that you have to follow here is going to be a tough one, but that is going to be saving 50 to 70% of your take home income and again, if you're looking to
retire by 30 years old, let's say you want to work from 20 to 30, and then not work for
the rest of your life, you're going to have to take
some drastic actions here.
And that is why you need to live off of a microscopic amount of money. And that's why step number
one is so important, by cutting down as much as possible on those monthly expenses. So people who are trying to do this, you're not going to see
them driving brand new cars, you're not going to see
them going on vacations, they're probably going to be,
you know, eating canned beans and doing campfires in the
backyard as summer entertainment. Not that there's anything wrong with that, but they are literally spending
as little money as possible, because they're focusing
on the long term picture of what they are trying to do. So people who are following
this FIRE movement are often aiming to save 30
times their annual expenses, and that will allow them to
withdraw about 4% per year without basically touching that principle and that is where that
4% rule comes into play.
And that is basically where you're able to draw from an account about 4% per year, and over a long period of
time based on the growth of that account and those investments, it shouldn't be chipping
away at the principle which should in theory
give you unlimited money. So what you're aiming
to do here is to lower your monthly expenses as much as possible.
Figure out what it costs
you to live per year, multiply that by 30, and then
save up that amount of money by saving 50 to 70% of your
paycheck every single week or month, or however often
you are getting paid. Alright so now the question
you guys have been waiting for, just how much money do
you need to have saved up and invested to live off of that money following the 4% rule. Well if your annual expenses
are $20,000 per year, they would recommend having 30 times that amount of money saved and
invested, so $600,000. If your annual expenses were $35,000, that number becomes 1.05 million. If you're somebody
spending $50,000 per year on your living expenses
you would need to have $1.5 million saved and invested,
and for the final figure here, if you spent $100,000 per
year on cars and housing and food and all of that,
you would need to have about $3 million to successfully
follow this strategy.
So I'm sure this goes without saying guys, the best way to follow the strategy and to reach that retirement as quickly as possible is going to be
to keep your monthly expenses as low as possible. And just to put it in
perspective for you guys, every additional $100
that you spend per month, if you follow this is
an additional $36,000 you need to have set
aside in that freedom fund to support that $100 of monthly spending. So if you're serious
about this and you want to retire at 30, or even younger, you are spending literally as little money as humanly possible. Alright so the final step
to following this strategy is going to be passively
investing in the stock market. So most people following this strategy are actually following
the Warren Buffett style of passively investing in index funds. And if you're not familiar,
index funds are basically a way for you to have diversified
exposure to the stock market. Where you're not essentially
picking what stocks are going to outperform,
you're just passively owning the entire market.
So people following this strategy are not out there trying
to beat the market, they are not stock
traders or stock pickers they simply passively invest
in these low fee index funds, one of the most popular ones being VOO or the vanguard 500 fund. And essentially what you are doing, is buying a small piece of the 500 largest publicly traded companies out there, and all the different
dividends those companies pay are all collectively put together, and then you earn a quarterly
dividend from that ETF.
And over the last hundred
years or so the stock market, on average, has returned
about eight to 10% per year. So if you were only drawing
4% from that account, based on historical data, you should never be
touching that principle over a long period of time. And that is how you would
be able to live off of 30 times your annual income, if you save that money and invest it. Now that being said that
is the perfect segue into the sponsor for this
video which is Webull. So if you guys are
interested in getting started with investing in the stock market, this is a totally commission
free broker out there, meaning you're not paying
any fees to please trades with them and you can
purchase the Vanguard 500 ETF that we're talking about in this video right on that Webull platform, and not only that, they're
willing to give you up to two completely free stocks just for opening up an account with them. Number one, if you open the account, you're going to get a free
stock worth up to $250, and then when you fund the account, you'll get an additional
stock worth up to 1000.
So if you do the math there, that is two completely free stocks worth up to $1,250. Now I am affiliated with Webull, so I do earn a commission in the process if you use my link, but
if you guys are interested in grabbing two completely free stocks that is going to be down
in the description below. So finally, the last
thing I want to do here is to put all of this together, and go through a real
example of how you could in fact follow this strategy and even retire by 30.
Now again, this is going to
require some very drastic saving because essentially you're trying to work for about 10 years of your life and then not have to work
for the rest of your life. So most people will never
be able to accomplish this, because of the amount of
sacrifice that is required, with that being said, let's go ahead and run
through the numbers now. So let's say you're earning
a salary of $75,000 per year from your job, and ideally,
you don't have any, you know school loans,
student loans, medical bills, or anything like that. So you haven't gotten
sucked into the consumerism and you don't have like a brand new car so your expenses are as low as possible.
And I know this sounds like
you know theoretical situation, but this was actually
about the same situation I was in, when I graduated
college I was 20 years old, now I was making about $68,000, so a little bit less, but I had no debts, I had no car payment,
and so I was somebody who could have potentially
followed this strategy. So after you pay your
taxes, your take home pay is going to be around $56,250. Now we know already in
order to pull this off, you need to save 50 to
70% of that take home pay in order to actually build up enough money to live off of that income. So we're going to assume
you are saving 70% of that take home pay. So you would need to live off of 30% of that post tax income, which
amounts to just over $16,000, or around $1400 per month.
Now, is that possible? It absolutely is. Is it easy? Absolutely not, you're certainly not going to be going out to the
bar and buying beers or going out to dinner,
you're probably going to be living in a tiny apartment driving an old car and eating at home for breakfast, lunch, and dinner. But if that type of
sacrifice is worth it to you for the long term picture, it is something you may
be willing to do yourself. So each year you would
be saving and investing a staggering amount of money, which is 70% of your take home pay
or just over a $39,000. And that is how you would
be able to pull this off, and assuming you kept that
cost of living the same at around $16,000, just over 16,000. your freedom number, or 30
times your annual expenses, would be just over $506,000. So, how long would it take
you to save up that money? Let's go ahead and answer that now.
Well if you took that
$39,375 per year of money that you are saving and
invested in the stock market, earning 8% return, and
as we said, historically, it's an eight to 10% so we're going to go on the conservative side, well in 10 years at 8%
return career you would have $570,408.40, meaning you could then, if you kept those living
expenses the same, following that 4% rule, not have to work for your
money past that point.
And just to circle back
guys what this really comes down to is the level
of sacrifice involved. Are you really willing to live
off of about $1400 per month, or do you want to have vacations and going out to get dinner
and things like that? So it's not people who are doing this that are out there traveling and dining it's people that are living
as frugal as possible and finding enjoyment
in other areas of life other than just, you know,
spending money on dining and things like that. Now, is this a strategy I
would personally follow? Probably not because I
am one of those people that enjoys traveling, I enjoy dining, and I do spend a little bit
more than the average person, so my freedom number would be
multiple millions of dollars, but instead I follow the
strategy of earning as much as possible and saving a
lot of that earned money, and then eventually allowing
that to supplement my income by having that interest
or the growth of my money paying for a lot of
those things that I want.
And believe it or not,
guys, there are honestly countless people out
there that have followed this exact strategy and
retired at 30 or less. One of the most well known people being Mr. Money Mustache, he has a whole blog where he documented this whole journey of becoming financially
independent and retiring early with both him and his wife. So I'm going to link up his blog down in the description below
as well as a couple of other stories about
people who have followed this exact strategy and
retired at 30 or less. So that's going to wrap
up this video guys, thanks so much for watching. If you're new to this channel, make sure you subscribe and
hit that bell for notifications so you don't miss future videos, and I hope to see you in the next one..
When can I retire? | How much Retirement Corpus is enough?
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
Hello friends welcome to
yadnya investment academy. Today is friday. So today we will talk about
a financial planning topic. Today's topic is Related to retirement planning A very common question of you all that come Obviously this all knows. Retirement is a very important goal. If we talk about financial goals. Mostly it should be. Mostly when i do financial planning So many persons financial
planning i have done personally Then in that comes. Retirement is a very important goal.
In which we need a lot of money Nowadays early retirement is occurring. FIRE environment talks are occurring. Financial free retire early In such things When retirement comes in goal One important thing comes How much money do I need? Tell me this much money is enough. Then I can retire. That is a normal question. For this we have already
developed an interesting calculator but that was before pay wall. Now we have removed that from pay wall because it is very useful calculator. So a retirement calculator we have made. In that with so many
permutations combinations We can get an idea This much retire corps I need. If I reach here then I have done well. I am at least financially free. Now I have to retire. We have to work further or not.
Then it is my decision. If above that. Now I am just sharing my screen. Now you will see here You will go on investyadnya website There is a section named
tracker and calculator. In this there is a retirement calculator. Open this Now here we have to fill information. Suppose i am putting age of 30. You have to retire suppose on 60. Suppose we took an
example i have to retire on 60. Life expectancy we mostly suggest We should keep 90, 95, 100. With a conservative estimate If you keep 100 then it is very
good conservative estimate. If you want to take optimistic If you took practical then it should be 90. Suppose i am putting here 95. Fourth information is our Current annual expense When we do retirement calculation Obvious we took assumptions. One assumption is this the
expense i am doing today Suppose when i retire Then also my expenses should be like this. Means my lifestyle of now remain maintained Neither i increase nor decrease.
Suppose I am spending 50k per month today. The expenses that are occurring. After retirement I will do the same expenses. After retirement expenses can reduce. It can be your house if
you are living now on rent. It can be so much rental expense. That can reduce. Now your children's expenses are so much. They will reduce at that time. Sometimes after retirement
expenses increase. Like vacation expenses mostly increases.
Sometimes medical expenses increase. Some expenses have increased. Mostly as an advisor If we took a general advice then we say. Keep the same expenses as they are now. Don't do much changes in that. Some increases some decreases. For example if we want
to do a simple calculation Then considering to current expenses Suppose my expense is 50,000 The profile we are taking has
expenses of 50,000 per month. Then it is 6 lakh rupees per year. You have to put today's expenses. You don't have to put off retirement age. That's all it will insert. Inflation number How much inflation number we have to take? 7% inflation is mostly suggested by India.
If you want to be conservative
then you can take 8%. If you want to be aggressive
then you can take 5-6%. Inflation you should calculate by your own. Every year how my expenses are increasing? If you know little bit idea about that These things are increasing
according to my expenses. Edcuation expenses children's fees It increases almost 8-10% every year. Rentals mostly 10%. Landlords mostly increases rent by 10%. My personal inflation is 8, 9-10%. You take according to your. So for calculation here
I am taking 7% inflation. Then return on investment. On the basis of return on investment. How much is my return on investment? Before retirement and after retirement. Now I am retiring at 60. At 30 I am starting investing. How much should I invest for that? How much retirement corpus I will get? The reason I am investing now.
On that how much return should I expect? It depends where you are investing. If you feel I will invest
mostly in equity markets. Retirement oriented because it is very long horizon. I am of 30 years and retiring at 60 years. Horizon is of 30 years. All that I am investing I will invest mostly on equity. Then we can take 11-12%
return on investment All that we will invest now. Or we kept in equity we can take that. If you feel This house is my retirement corpus This will increase according to that. Then on real estate the return
on expectations that remains. Basically there is round inflation of 7-8%. It depends on you if you have EPFO. That is a very big retirement corpus On EPF we get around 8%. According to that you have invested here. Overall that you are investing Or you are planning This is for retirement
and I am going to invest.
What are expected returns on that? Till 60. Pre retirement is retirement on investment. Suppose it is 12%. Whole the money I will put in equity. Then you took 12% return. Then post retirement my corpse will become. How much will it grow? Suppose I retire and I get corpus of 5 crores. Then 5 crore rupees Where will I invest? Again very difficult question If you are of 30 years then in 60 years.
This is very difficult. This is a very big assumption. We have to think mostly at 60 our risk profile decreases. We will not take much equity allocation. Suppose now we have 60-70 equity allocation That time it becomes 20-30% or 40%. I go a little bit on conservative. I say to most of the people Take percentage equal to inflation I get return same as inflation. If I want to take. Then 0.5-1% extra. We took here 8%. Means 8% of post retirement. My corpus will grow 8% after that. Inflation will remain 7%. This is planning according to that. We will discuss these points later. Therefore I am doing all these zero. We inserted these things. What we say? Our retirement age, life expectancy. Our annual expense, inflation. These all are our compulsory fields. If I consider this now.
Sorry some value needs to be inserted. Randomly value we are inserting. So that it can work. If I consider this now. Then I need retirement
corpus of 14.6 crores. If you are of 30 years and you have to do expense of 50k per month. At today's value Today's 50k offcourse will not remain same at the time of retirement. They will increase with inflation. If you have to maintain today lifestyle The 50k expenses you are doing today Same you want to do at 60. After 30 years. This is the value after 30 years. Don't be so afraid. Today 14.5 crore is very much. After 30 years the value of 14.5 That should be arounf 70-80 lakh or 1 crore I am doing guess work. It will not be more than that. Think if I have 1 crore rupees today then I will be able to do for next 35 years. 60-95 years means 35 years 35k per month That to inflation to adjust it.
I will get it consistently till 95 in 95 it will become zero. If i invest lumpsum then i can invest 50 lakhs. Considering I don't have anything. If I have 50 lakh rupees I will invest it. For 30 years they will grow by 12%. Expected pre-retirement. Then also my retirement money will be done. Monthly Sip that I have to do That is around 50,000 in this. 48,000 rupees sip i need in this. What is the meaning of step up? I will tell this in next. If you have plan in 30 years 60 years. I have to do all these things. Then you have to do monthly sip of 48,000. To retire for next 30 years. Remember this is a monthly sip. It will not increase. Every year you have to do 48k consistently.
Obviously our salary will increase in years Inflation increases salary increases. Now 48,000 will seem so big But after 3-5 years You will not feel big amount. That's what I am saying. In that our step up point comes. Now you will say I don't have 48,000 to invest. It is a very big amount. From where 48,000 will come. If we are spending 50,000 Then by saving 50,000 we
can invest in retirement corpus. That is not possible. Then in that our second comes step up sip What is the meaning of step up sip? What is annual increase in our income? Can we increase sip every year? I cannot invest 48,000 now but from next year i can increase. If you think my annual increase in income. If inflation is of 7%. With 7% income should increase If we take seven With 7% it is increasing. We considered 7% inflation. Salary is also increasing by 7%. In worst case salary is not changing. With 7% there is increase in salary. Existing investment Do you have any investment now? That you think this is my retirement income From that also it will reduce.
Suppose if you have EPFO corpus Suppose of 5 lakh rupees. 5 lakh rupees i inserted here. This is my EPFO of 5 lakh rupees. I will use it for retirement. On that how much return I will get on EPFO? Return are 8% Then we consider we will get 8%. It is tax free means you will get 8% Suppose i have 5 lakh rupees On that i will get 8% more.
Now let's do calculation again. Now since EPFO arrived. From 48 it became 46. Retirement corpus remained same. So now we have to do Sip of 46,000. We can do step up sip of 24,000. We invested 24,000 rupees this month. Every year we increase that by 7%. From annual increase in income we have to do this annual increase in sip. Today you started sip of 24,300. Next year increased 7% on that. Then again in next year increase 7% on that Compounding 7%. Increase 7% every year Till the age of 60. Then also your goal will be achieved. Then you will have 14.6 crores rupees. Considering these were our rates of returns So it is very very good. You can apply so much
permutations and combinations on this. I have little more money than 24,000. I can do upto 35,000. Can I retire early? Then can I retire at 58? On 58 it will happen at 29,000. I have 35,000. Can I retire at 55? Now your interesting calculation will start No you need 37,000 For retirement at 55.
Early retirement you can take at 37,000. If i do 37,000 per year. I invest in such investments
that give me 12% every year. 7% increase i put minimum. If you think 7% increase is less. Consider growth of salary minimum 8-10%. Why not? Consider 10%. Then in Rs 28,000 you can retire at 55. Retirement corpus also reduced. As early you retire that much less corpus you will want. Value of money comes less. At that time its value will be more. At the age of 55 we need 11.6 crores. How much lump sum funding we need? How much monthly sip
and stepup sip we need? I considered 10% annual increase. Like this If you can do so many
permutations and combinations. You can plan yourself. When can I become financially free? I think this is very interesting calculator If you like as i am a conservative investor I am not taking 12% from whole equity. Suppose we take 9%. This we keep 10. The rate of return become 9% from 12%. Obviously both the sip's will increase. You can do calculation according to that. Which type of investor is I am? If you think here is also 9
then it will change again.
These things you can do so many permutations and combinations
based on your profile. You will get so much support and understand If I invest this much money For this much time Then I can go towards a better retirement. This is how you should work on these things. You can plan early retirement. You want to spend so much or not. 50,000 will not be sufficient. I want to increase my lifestyle. Now I am spending 50,000. But at that time I want to spend 75,000. Acc to that by using
permutation and combination What are my savings now? I can plan such investments or not. Then in those things you will get
so much help from these calculator.. Do check that on our website. If you have any comment If there are complications
then visit our website. Below is our email address and
whats app number is given. All things are written below. You can email us there
if you have any query. Below there is comment section also. Must write in comment section. Hit a like if you liked the video.
If you think some knowledge is added Then hit a like Have a great time ahead friends Jai Hind.
Read More
How to Plan for Early Retirement: Exclusive Retirement Calculator
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
When someone says the word Retirement, what comes to your mind? Is it the age at which you would probably retire or is it the bank balance that you would have or the abundant time you will have to do whatever you like doing. I think it's a combination of all three. Because all these three require lots and lots of money. Yes, in today’s video we will talk about how you can retire successfully and can generate enough corpus that your lifestyle does not get affected at all. Hi, I'm Samarth, for the past 11 years, I have been working in the finance industry and I'm currently the investments lead at wint wealth. Retirement, it should essentially mean financial freedom. In today’s example we will assume that you started your job or career at 22 or 23 years of age. And as of today, your age is 30 years. For the next 20 years, we are assuming that you'll continue your active line of work, essentially meaning that you will retire by the age of 50. Wait, wait, wait! I know you might be wondering that this video was for early retirement.
See the idea is to let you know that what should be the method for retirement calculation. If you are a little aggressive on that, you might retire by 40 itself or by 45. It all depends on your consistency and your persistence. For the time being , we have calculated this on a very conservative way and hence 50 has been considered as the retirement age. So now we'll be focusing on the example and for this we will be looking at the excel sheet. By the way, this Excel sheet that you can see on the screen can be downloaded using the link in the description and also help us know in the comments if you found this Excel sheet to be useful.
Infact, you can also download sheet right now and use it live while watching the video. You can change the numbers and see if it is suiting you and how it can help you to achieve your retirement. We have assumed that your current age is 30 years. And you started your work life or your career or your job around 22 or 23 years of age. You want to retire at the age of 50 years, your life expectancy is around 80 years. Now because you have already worked for around 7-7.5 years, we are assuming that you have saved roughly two to two and a half lakh per year, so your total savings as on date would be 16 Lakh Rupees. How is this split? Majority portion of investment is done in mutual funds. I too personally, when I started my career, so majority savings (up to 80-90%) I used to do in mutual funds. And I used to split them into growth mutual funds and a small part into dividend mutual funds.
After that since you are doing a job, you will contribute towards EPF. So we have assumed that this is around three lakh rupees. For emergency fund, you have kept some money into FD or bank balance, which is around two lakh rupees, and then remaining money, you have explored another debt option that is public provident fund and under this you have invested two lakh rupees. Basis our assumption and calculation, on this entire corpus of 16 Lakh Rupees up to the age of retirement, that is for the next 20 years, you will generate 10% returns.
So this 16 Lakh Rupees will get converted to 1.15 Crore Rupees. Yes, You heard it right. Believe me, if you do the savings consistently and in a discipline way, your Corpus becomes massive slowly. By the time I had completed five years in my job, I had enough money to pay for my car all in cash. But does that mean that mean, I did so? No. By the way, if you want to know if it makes sense for you to buy a car or use services like Ola and Uber, please watch this video. Now we are assuming that your monthly take home salary is one lakh rupees. And out of this 60,000, that is 60% of your take home salary is spent by you. After that how much would be your savings? 40,000 Rupees. Now if you keep saving this monthly, consistently in a discipline way, then you can easily generate the amount of corpus such that during your retirement life, you can manage your lifestyle very easily and won’t be financially dependent on anyone.
Next assumption which we have taken is that on your salary you will get an increment of around 8%. I know you might be feeling that the 8% figure is too high but you must also consider that although there might be years when you get only 5% or 7%. I really wish you never get so low increments, but there will be years when you will switch your job or get promotion, when your increment might be 20%, 25%. During your pre retirement age, that is up to the age of 50 years we have assumed that years care, return 10% on the amount which you're investing and on the corpus, which you already have save.
Then after retirement this figure drops to 7%. I know you must be thinking this is low, but considering that after retirement your priority will be to save capital and also beat inflation to maintain your lifestyle 7% is a very healthy number. One very important assumption that we have taken is that after retirement there will be a lot of expenses that you won't be incurring. For example, your petrol and traveling expense will reduce substantially. Then it is also true that services like internet where you require a speed of 1 GB currently, will come down to 100 or 200 MBPS then. So that will reduce your expenses. And there are many other such expenses. Okay. So we have assumed that there will be reduction of around 20% to your expenses post retirement.
All these expenses have been adjusted against inflation at the rate of 6%. There are many such expenses which are incurred once or twice in our lifetime. One of them being expenses for sending your child for higher education. If on today’s date, you send your child for higher education so may be you will spend around 30-32 Lakh Rupees, to send the child at a very good institution. This we have assumed that when you will be 52 years old, this expense will occur and at that time, considering the inflation of 6%, this will be around 96 lakh rupees. Now that you have sent your child for higher education, then after he gets settled, probably he or she will get married.
Right? We have assumed that if today you got for their marriage then you will end up spending around 25 Lakh Rupees. According to your assumptions, this event will occur when you will be 60 years old. At that point of time, you will be spending around 80 Lakh Rupees. So this also has been built in, in this model. Last but not the least and definitely one of the most important is: medical expenses. As and when you age increases, simultaneously your medical needs will also probably increase. I really wish, this doesn’t happen but it is quite possible. So on a conservative basis, we have assumed that by the time you turn 65, you might end up needing a medical expense budget of around 50 lakh rupees. Right? Which up till then will be around 1.6 Crores, right. 35 years from now, it would be around 1.60 crores. So assuming all of this if you see all this calculation, then you will find that you would probably end up needing around 8.25 Crore Rupees as your Corpus so that you can retire comfortably.
If you are able to generate this corpus by investing around 40% of your salary basis the following assumptions, month to month, year on year in instruments, which help you generate good returns like mutual funds and corporate bonds for the early starters, and then slowly and slowly moving towards more of conservative investments, where you can easily generate 9.5-9.7%, then you'll be able to achieve this corpus and basis this calculation, that you can see in the third sheet post retirement, you will see that even after you turn 80 years of age around around one crude Rupe, you will still be left with. So if you save in a disciplined way, start investments, then you can easily achieve your retirement. Under this sheet, you can also put your other additional expenses basis your age.
If you will see we have provided Additional 1 to Additional 8 blank spaces, as when you enter there it'll automatically get calculated and you will keep getting the results. The larger your retirement corpus, easier will be your retirement life, the more you will be able to afford to give to your family and enjoy the moments with them. This is why Savings are important. This is why retirement planning is important. And if you're worried to know how you can make your portfolio stronger and better in this video, we have discussed few revenue streams, which will help you generate passive income along with maintaining the safety of your portfolio until you meet next time. Happy Winting!
.
When can I retire? | How much Retirement Corpus is enough?
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
Hello friends welcome to
yadnya investment academy. Today is friday. So today we will talk about
a financial planning topic. Today's topic is Related to retirement planning A very common question of you all that come Obviously this all knows. Retirement is a very important goal. If we talk about financial goals. Mostly it should be. Mostly when i do financial planning So many persons financial
planning i have done personally Then in that comes. Retirement is a very important goal. In which we need a lot of money Nowadays early retirement is occurring.
FIRE environment talks are occurring. Financial free retire early In such things When retirement comes in goal One important thing comes How much money do I need? Tell me this much money is enough. Then I can retire. That is a normal question. For this we have already
developed an interesting calculator but that was before pay wall. Now we have removed that from pay wall because it is very useful calculator. So a retirement calculator we have made. In that with so many
permutations combinations We can get an idea This much retire corps I need. If I reach here then I have done well. I am at least financially free. Now I have to retire. We have to work further or not. Then it is my decision. If above that. Now I am just sharing my screen. Now you will see here You will go on investyadnya website There is a section named
tracker and calculator. In this there is a retirement calculator.
Open this Now here we have to fill information. Suppose i am putting age of 30. You have to retire suppose on 60. Suppose we took an
example i have to retire on 60. Life expectancy we mostly suggest We should keep 90, 95, 100. With a conservative estimate If you keep 100 then it is very
good conservative estimate. If you want to take optimistic If you took practical then it should be 90. Suppose i am putting here 95. Fourth information is our Current annual expense When we do retirement calculation Obvious we took assumptions. One assumption is this the
expense i am doing today Suppose when i retire Then also my expenses should be like this. Means my lifestyle of now remain maintained Neither i increase nor decrease. Suppose I am spending 50k per month today. The expenses that are occurring. After retirement I will do the same expenses. After retirement expenses can reduce. It can be your house if
you are living now on rent. It can be so much rental expense. That can reduce.
Now your children's expenses are so much. They will reduce at that time. Sometimes after retirement
expenses increase. Like vacation expenses mostly increases. Sometimes medical expenses increase. Some expenses have increased. Mostly as an advisor If we took a general advice then we say. Keep the same expenses as they are now. Don't do much changes in that. Some increases some decreases. For example if we want
to do a simple calculation Then considering to current expenses Suppose my expense is 50,000 The profile we are taking has
expenses of 50,000 per month. Then it is 6 lakh rupees per year.
You have to put today's expenses. You don't have to put off retirement age. That's all it will insert. Inflation number How much inflation number we have to take? 7% inflation is mostly suggested by India. If you want to be conservative
then you can take 8%. If you want to be aggressive
then you can take 5-6%. Inflation you should calculate by your own. Every year how my expenses are increasing? If you know little bit idea about that These things are increasing
according to my expenses. Edcuation expenses children's fees It increases almost 8-10% every year. Rentals mostly 10%. Landlords mostly increases rent by 10%. My personal inflation is 8, 9-10%. You take according to your. So for calculation here
I am taking 7% inflation. Then return on investment. On the basis of return on investment. How much is my return on investment? Before retirement and after retirement. Now I am retiring at 60. At 30 I am starting investing. How much should I invest for that? How much retirement corpus I will get? The reason I am investing now. On that how much return should I expect? It depends where you are investing.
If you feel I will invest
mostly in equity markets. Retirement oriented because it is very long horizon. I am of 30 years and retiring at 60 years. Horizon is of 30 years. All that I am investing I will invest mostly on equity. Then we can take 11-12%
return on investment All that we will invest now. Or we kept in equity we can take that. If you feel This house is my retirement corpus This will increase according to that. Then on real estate the return
on expectations that remains. Basically there is round inflation of 7-8%. It depends on you if you have EPFO. That is a very big retirement corpus On EPF we get around 8%. According to that you have invested here. Overall that you are investing Or you are planning This is for retirement
and I am going to invest.
What are expected returns on that? Till 60. Pre retirement is retirement on investment. Suppose it is 12%. Whole the money I will put in equity. Then you took 12% return. Then post retirement my corpse will become. How much will it grow? Suppose I retire and I get corpus of 5 crores. Then 5 crore rupees Where will I invest? Again very difficult question If you are of 30 years then in 60 years. This is very difficult. This is a very big assumption. We have to think mostly at 60 our risk profile decreases. We will not take much equity allocation.
Suppose now we have 60-70 equity allocation That time it becomes 20-30% or 40%. I go a little bit on conservative. I say to most of the people Take percentage equal to inflation I get return same as inflation. If I want to take. Then 0.5-1% extra. We took here 8%. Means 8% of post retirement. My corpus will grow 8% after that. Inflation will remain 7%.
This is planning according to that. We will discuss these points later. Therefore I am doing all these zero. We inserted these things. What we say? Our retirement age, life expectancy. Our annual expense, inflation. These all are our compulsory fields. If I consider this now. Sorry some value needs to be inserted. Randomly value we are inserting. So that it can work. If I consider this now. Then I need retirement
corpus of 14.6 crores. If you are of 30 years and you have to do expense of 50k per month.
At today's value Today's 50k offcourse will not remain same at the time of retirement. They will increase with inflation. If you have to maintain today lifestyle The 50k expenses you are doing today Same you want to do at 60. After 30 years. This is the value after 30 years. Don't be so afraid. Today 14.5 crore is very much. After 30 years the value of 14.5 That should be arounf 70-80 lakh or 1 crore I am doing guess work. It will not be more than that. Think if I have 1 crore rupees today then I will be able to do for next 35 years. 60-95 years means 35 years 35k per month That to inflation to adjust it. I will get it consistently till 95 in 95 it will become zero. If i invest lumpsum then i can invest 50 lakhs. Considering I don't have anything. If I have 50 lakh rupees I will invest it. For 30 years they will grow by 12%. Expected pre-retirement. Then also my retirement money will be done. Monthly Sip that I have to do That is around 50,000 in this. 48,000 rupees sip i need in this. What is the meaning of step up? I will tell this in next.
If you have plan in 30 years 60 years. I have to do all these things. Then you have to do monthly sip of 48,000. To retire for next 30 years. Remember this is a monthly sip. It will not increase. Every year you have to do 48k consistently. Obviously our salary will increase in years Inflation increases salary increases. Now 48,000 will seem so big But after 3-5 years You will not feel big amount. That's what I am saying. In that our step up point comes. Now you will say I don't have 48,000 to invest.
It is a very big amount. From where 48,000 will come. If we are spending 50,000 Then by saving 50,000 we
can invest in retirement corpus. That is not possible. Then in that our second comes step up sip What is the meaning of step up sip? What is annual increase in our income? Can we increase sip every year? I cannot invest 48,000 now but from next year i can increase.
If you think my annual increase in income. If inflation is of 7%. With 7% income should increase If we take seven With 7% it is increasing. We considered 7% inflation. Salary is also increasing by 7%. In worst case salary is not changing. With 7% there is increase in salary. Existing investment Do you have any investment now? That you think this is my retirement income From that also it will reduce. Suppose if you have EPFO corpus Suppose of 5 lakh rupees. 5 lakh rupees i inserted here. This is my EPFO of 5 lakh rupees. I will use it for retirement. On that how much return I will get on EPFO? Return are 8% Then we consider we will get 8%. It is tax free means you will get 8% Suppose i have 5 lakh rupees On that i will get 8% more. Now let's do calculation again. Now since EPFO arrived. From 48 it became 46. Retirement corpus remained same. So now we have to do Sip of 46,000. We can do step up sip of 24,000. We invested 24,000 rupees this month. Every year we increase that by 7%. From annual increase in income we have to do this annual increase in sip.
Today you started sip of 24,300. Next year increased 7% on that. Then again in next year increase 7% on that Compounding 7%. Increase 7% every year Till the age of 60. Then also your goal will be achieved. Then you will have 14.6 crores rupees. Considering these were our rates of returns So it is very very good. You can apply so much
permutations and combinations on this. I have little more money than 24,000. I can do upto 35,000. Can I retire early? Then can I retire at 58? On 58 it will happen at 29,000. I have 35,000. Can I retire at 55? Now your interesting calculation will start No you need 37,000 For retirement at 55. Early retirement you can take at 37,000. If i do 37,000 per year. I invest in such investments
that give me 12% every year. 7% increase i put minimum. If you think 7% increase is less. Consider growth of salary minimum 8-10%. Why not? Consider 10%. Then in Rs 28,000 you can retire at 55. Retirement corpus also reduced. As early you retire that much less corpus you will want. Value of money comes less.
At that time its value will be more. At the age of 55 we need 11.6 crores. How much lump sum funding we need? How much monthly sip
and stepup sip we need? I considered 10% annual increase. Like this If you can do so many
permutations and combinations. You can plan yourself. When can I become financially free? I think this is very interesting calculator If you like as i am a conservative investor I am not taking 12% from whole equity. Suppose we take 9%. This we keep 10. The rate of return become 9% from 12%. Obviously both the sip's will increase. You can do calculation according to that. Which type of investor is I am? If you think here is also 9
then it will change again. These things you can do so many permutations and combinations
based on your profile. You will get so much support and understand If I invest this much money For this much time Then I can go towards a better retirement.
This is how you should work on these things. You can plan early retirement. You want to spend so much or not. 50,000 will not be sufficient. I want to increase my lifestyle. Now I am spending 50,000. But at that time I want to spend 75,000. Acc to that by using
permutation and combination What are my savings now? I can plan such investments or not.
Then in those things you will get
so much help from these calculator.. Do check that on our website. If you have any comment If there are complications
then visit our website. Below is our email address and
whats app number is given. All things are written below. You can email us there
if you have any query. Below there is comment section also. Must write in comment section.
Hit a like if you liked the video. If you think some knowledge is added Then hit a like Have a great time ahead friends Jai Hind.
Read More
When can I retire? | How much Retirement Corpus is enough?
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
Hello friends welcome to
yadnya investment academy. Today is friday. So today we will talk about
a financial planning topic. Today's topic is Related to retirement planning A very common question of you all that come Obviously this all knows. Retirement is a very important goal. If we talk about financial goals. Mostly it should be. Mostly when i do financial planning So many persons financial
planning i have done personally Then in that comes. Retirement is a very important goal. In which we need a lot of money Nowadays early retirement is occurring. FIRE environment talks are occurring. Financial free retire early In such things When retirement comes in goal One important thing comes How much money do I need? Tell me this much money is enough.
Then I can retire. That is a normal question. For this we have already
developed an interesting calculator but that was before pay wall. Now we have removed that from pay wall because it is very useful calculator. So a retirement calculator we have made. In that with so many
permutations combinations We can get an idea This much retire corps I need. If I reach here then I have done well. I am at least financially free. Now I have to retire. We have to work further or not. Then it is my decision. If above that. Now I am just sharing my screen.
Now you will see here You will go on investyadnya website There is a section named
tracker and calculator. In this there is a retirement calculator. Open this Now here we have to fill information. Suppose i am putting age of 30. You have to retire suppose on 60. Suppose we took an
example i have to retire on 60. Life expectancy we mostly suggest We should keep 90, 95, 100. With a conservative estimate If you keep 100 then it is very
good conservative estimate. If you want to take optimistic If you took practical then it should be 90. Suppose i am putting here 95. Fourth information is our Current annual expense When we do retirement calculation Obvious we took assumptions.
One assumption is this the
expense i am doing today Suppose when i retire Then also my expenses should be like this. Means my lifestyle of now remain maintained Neither i increase nor decrease. Suppose I am spending 50k per month today. The expenses that are occurring. After retirement I will do the same expenses. After retirement expenses can reduce. It can be your house if
you are living now on rent. It can be so much rental expense. That can reduce. Now your children's expenses are so much.
They will reduce at that time. Sometimes after retirement
expenses increase. Like vacation expenses mostly increases. Sometimes medical expenses increase. Some expenses have increased. Mostly as an advisor If we took a general advice then we say. Keep the same expenses as they are now. Don't do much changes in that. Some increases some decreases. For example if we want
to do a simple calculation Then considering to current expenses Suppose my expense is 50,000 The profile we are taking has
expenses of 50,000 per month.
Then it is 6 lakh rupees per year. You have to put today's expenses. You don't have to put off retirement age. That's all it will insert. Inflation number How much inflation number we have to take? 7% inflation is mostly suggested by India. If you want to be conservative
then you can take 8%. If you want to be aggressive
then you can take 5-6%. Inflation you should calculate by your own. Every year how my expenses are increasing? If you know little bit idea about that These things are increasing
according to my expenses. Edcuation expenses children's fees It increases almost 8-10% every year. Rentals mostly 10%. Landlords mostly increases rent by 10%. My personal inflation is 8, 9-10%. You take according to your. So for calculation here
I am taking 7% inflation. Then return on investment. On the basis of return on investment. How much is my return on investment? Before retirement and after retirement.
Now I am retiring at 60. At 30 I am starting investing. How much should I invest for that? How much retirement corpus I will get? The reason I am investing now. On that how much return should I expect? It depends where you are investing. If you feel I will invest
mostly in equity markets. Retirement oriented because it is very long horizon. I am of 30 years and retiring at 60 years. Horizon is of 30 years. All that I am investing I will invest mostly on equity. Then we can take 11-12%
return on investment All that we will invest now. Or we kept in equity we can take that. If you feel This house is my retirement corpus This will increase according to that. Then on real estate the return
on expectations that remains. Basically there is round inflation of 7-8%.
It depends on you if you have EPFO. That is a very big retirement corpus On EPF we get around 8%. According to that you have invested here. Overall that you are investing Or you are planning This is for retirement
and I am going to invest. What are expected returns on that? Till 60. Pre retirement is retirement on investment. Suppose it is 12%. Whole the money I will put in equity. Then you took 12% return. Then post retirement my corpse will become. How much will it grow? Suppose I retire and I get corpus of 5 crores.
Then 5 crore rupees Where will I invest? Again very difficult question If you are of 30 years then in 60 years. This is very difficult. This is a very big assumption. We have to think mostly at 60 our risk profile decreases. We will not take much equity allocation. Suppose now we have 60-70 equity allocation That time it becomes 20-30% or 40%. I go a little bit on conservative. I say to most of the people Take percentage equal to inflation I get return same as inflation. If I want to take.
Then 0.5-1% extra. We took here 8%. Means 8% of post retirement. My corpus will grow 8% after that. Inflation will remain 7%. This is planning according to that. We will discuss these points later. Therefore I am doing all these zero. We inserted these things. What we say? Our retirement age, life expectancy. Our annual expense, inflation. These all are our compulsory fields. If I consider this now. Sorry some value needs to be inserted. Randomly value we are inserting. So that it can work.
If I consider this now. Then I need retirement
corpus of 14.6 crores. If you are of 30 years and you have to do expense of 50k per month. At today's value Today's 50k offcourse will not remain same at the time of retirement. They will increase with inflation. If you have to maintain today lifestyle The 50k expenses you are doing today Same you want to do at 60. After 30 years. This is the value after 30 years. Don't be so afraid. Today 14.5 crore is very much. After 30 years the value of 14.5 That should be arounf 70-80 lakh or 1 crore I am doing guess work. It will not be more than that. Think if I have 1 crore rupees today then I will be able to do for next 35 years. 60-95 years means 35 years 35k per month That to inflation to adjust it. I will get it consistently till 95 in 95 it will become zero. If i invest lumpsum then i can invest 50 lakhs.
Considering I don't have anything. If I have 50 lakh rupees I will invest it. For 30 years they will grow by 12%. Expected pre-retirement. Then also my retirement money will be done. Monthly Sip that I have to do That is around 50,000 in this. 48,000 rupees sip i need in this. What is the meaning of step up? I will tell this in next. If you have plan in 30 years 60 years.
I have to do all these things. Then you have to do monthly sip of 48,000. To retire for next 30 years. Remember this is a monthly sip. It will not increase. Every year you have to do 48k consistently. Obviously our salary will increase in years Inflation increases salary increases. Now 48,000 will seem so big But after 3-5 years You will not feel big amount. That's what I am saying. In that our step up point comes. Now you will say I don't have 48,000 to invest. It is a very big amount. From where 48,000 will come. If we are spending 50,000 Then by saving 50,000 we
can invest in retirement corpus. That is not possible. Then in that our second comes step up sip What is the meaning of step up sip? What is annual increase in our income? Can we increase sip every year? I cannot invest 48,000 now but from next year i can increase.
If you think my annual increase in income. If inflation is of 7%. With 7% income should increase If we take seven With 7% it is increasing. We considered 7% inflation. Salary is also increasing by 7%. In worst case salary is not changing. With 7% there is increase in salary. Existing investment Do you have any investment now? That you think this is my retirement income From that also it will reduce. Suppose if you have EPFO corpus Suppose of 5 lakh rupees. 5 lakh rupees i inserted here. This is my EPFO of 5 lakh rupees. I will use it for retirement. On that how much return I will get on EPFO? Return are 8% Then we consider we will get 8%. It is tax free means you will get 8% Suppose i have 5 lakh rupees On that i will get 8% more. Now let's do calculation again. Now since EPFO arrived. From 48 it became 46. Retirement corpus remained same.
So now we have to do Sip of 46,000. We can do step up sip of 24,000. We invested 24,000 rupees this month. Every year we increase that by 7%. From annual increase in income we have to do this annual increase in sip. Today you started sip of 24,300. Next year increased 7% on that. Then again in next year increase 7% on that Compounding 7%. Increase 7% every year Till the age of 60. Then also your goal will be achieved. Then you will have 14.6 crores rupees. Considering these were our rates of returns So it is very very good. You can apply so much
permutations and combinations on this.
I have little more money than 24,000. I can do upto 35,000. Can I retire early? Then can I retire at 58? On 58 it will happen at 29,000. I have 35,000. Can I retire at 55? Now your interesting calculation will start No you need 37,000 For retirement at 55. Early retirement you can take at 37,000. If i do 37,000 per year. I invest in such investments
that give me 12% every year. 7% increase i put minimum. If you think 7% increase is less. Consider growth of salary minimum 8-10%. Why not? Consider 10%. Then in Rs 28,000 you can retire at 55. Retirement corpus also reduced. As early you retire that much less corpus you will want.
Value of money comes less. At that time its value will be more. At the age of 55 we need 11.6 crores. How much lump sum funding we need? How much monthly sip
and stepup sip we need? I considered 10% annual increase. Like this If you can do so many
permutations and combinations. You can plan yourself. When can I become financially free? I think this is very interesting calculator If you like as i am a conservative investor I am not taking 12% from whole equity. Suppose we take 9%. This we keep 10. The rate of return become 9% from 12%. Obviously both the sip's will increase. You can do calculation according to that. Which type of investor is I am? If you think here is also 9
then it will change again. These things you can do so many permutations and combinations
based on your profile. You will get so much support and understand If I invest this much money For this much time Then I can go towards a better retirement.
This is how you should work on these things. You can plan early retirement. You want to spend so much or not. 50,000 will not be sufficient. I want to increase my lifestyle. Now I am spending 50,000. But at that time I want to spend 75,000. Acc to that by using
permutation and combination What are my savings now? I can plan such investments or not. Then in those things you will get
so much help from these calculator..
Do check that on our website. If you have any comment If there are complications
then visit our website. Below is our email address and
whats app number is given. All things are written below. You can email us there
if you have any query. Below there is comment section also. Must write in comment section. Hit a like if you liked the video. If you think some knowledge is added Then hit a like Have a great time ahead friends Jai Hind.
Millionaire Grant Sabatier Reacts: Early Retirement With $2.2 Million To Live In Portugal
Jason 0 Comments Retire Wealthy Retirement Planning Tips for Retiree's
Hi, I'' m Give Sabatier, the creator of
Millennial Cash as well as the writer of Financial Freedom. And also today I'' m mosting likely to see this video clip,
“” Exactly how we retired early with $2.2 million to take a trip the world.”” I'' ve never seen it previously, and I'' m going to offer my response. See to it you similar to this video and subscribe to see even more of these response videos. Ready to rock and also roll? All right, let'' s do it. Pumped for this.'Because we ' ve been retired, I have been able to take a lot of time to do the important things that I wanted to do. And also that ' s the reason we began in our low cost of living nation, because they provided us a really excellent insight of where our cash is going to obtain us. Are they in Portugal? We really felt that we could readjust effectively as well as be able to live, retired this way. Points simply formed as well as we'' re. able to do more points instead of being caught up in the entire daily grind. Good work. The way of life … Relocated to Portugal. Yeah, I was right. I'' m Dianne and also I ' m Guillermo.And I was 47 when we achieved FIRE And I was 44 when I achieved FIRE. We had conserved up $2.2 million as well as chose.
to travel the globe in search of our permanently home. Portugal'' s like dishonesty when it comes.
to FIRE since I assume the cost of living is probably like 25% to 30% what.
If they'' ve saved$ 2.2 million, that. Dianne and also Guillermo have a.
lot great deal money cash conserved for for their journey.
established a little actual estate team in the USA, Northern Virginia,.
D.C.Metro location
. I was in the telecom market for over.
Two decades Did 4 years in the military in the.
Militaries. So I matured in Northern Virginia. It'' s one of the fastest expanding genuine. estate markets in the nation. I'' m guessing that in addition to obtaining.
nice huge compensations on her sales, she likewise spent in a pair investment.
residential properties. I'' m thrilled to see if that'' s the case. In 2018, our net worth was$ 2.2 million.
USD as well as currently today in 2022, our net well worth is $2.6 million.
There you go. That'' s an important point.They retired in 2018 as well as they'' ve been.
advancing market in background. And I started purchasing 2010 as well as simply.
the development of my financial investments from 2018 to 2022 has in fact outpaced theirs. They'' ve been able to take benefit.
of that uncommon opportunity. Whereas if you retire at the right time.
and also then your portfolio expands at 20% or 30% right after you retire, you have a.
lot more alternatives. My stepmother in fact was detected.
with cancer cells and also my mommy finished up having to look after.
them together with myself. As well as the week that he died, my.
mommy was detected with cancer cells. I invested even more than a year dealing with.
her. And also I realized despite the fact that I'' d constantly. wished to retire prior to 50, I just didn'' t also desire to wait any type of longer. I started actually having a look at our.
numbers.I began speaking with a monetary. expert.
I found the FIRE neighborhood and also I showed up.
It sounds like Dianne'' s actually. And also in truth, my spouse might care less.
concerning money or FIRE or economic freedom, but she was excited around.
It'' s important to keep in mind that it'' s a lot. Our strategy was to remain two years in each.
country to explore as well as see if we can locate our forever home in each country.So we did 3 years in Mexico due to the fact that of. the pandemic.
There was one added year that would.
keep. Afterwards, we wished to check out more of.
Europe. We have our money mostly in an actual.
estate market as well as in Roth IRAs. We put on'' t actually have an economic.
expert, and also we also have cash in brokerage accounts and also in high.
investment financial savings accounts. I wish they get right into their specifics of.
their realty financial investments. That'' s the initial thing that they provided. And also then the second was Roth IRAs, and also.
after that the last was brokerage. My guess is that they have a couple of.
rental buildings and also they'' re making some cash that way. Along with the cash that we conserved.
up for retired life, we kept three rental properties.Yes.
in Virginia as part of our.
investment portfolio. So we in fact offered a property in.
Alexandria, Virginia, that we were living in. I transformed $120,000 on that particular.
residential property. We acquired one in Gainesville that we.
stayed in for a number of years, which'' s one that we converted right into one.
Right here'' s one of the blunders they made. It'' s one of the fastest appreciating.
markets in the nation, extremely close to National Airport in DC, best throughout.
the Potomac River from D.C. And Alexandria building is something, at.
least in their situation, I'' d advise they hang on to as a leasing for as long as.
feasible. It'' s a lot more valuable dangling on.
it as a service for the following 20, thirty years than it was marketing for $100,000 to.
$ 150,000 in profit.So our common expenses in the United States before. We have actually just been in Portugal about 6.
months currently. So they'' re still residing in a high,.
expensive location for much less than $100,000 a year, but certainly cutting their.
costs considerably. My hunch is they can have FIRE'' d perhaps. 3, 4 or 5 years earlier. And also I ask yourself why they in fact made a decision.
to be more conservative.I invested time
in Lisbon myself, and also. it was tough to invest cash there. Especially when you can eat those fresh. sardines for like EUR1 per bushel and also
get a container of white wine for EUR2 or less. So I ' m in fact interested just how they ' re. spending a lot money unless they have a really baller house, which it doesn ' t. appear like from this video clip they have.
That understands, possibly they ' ve got some. secret splurges and they ' re really right into scuba diving or something. I ' ve been getting right into crypto,'so I may. be finding out regarding that even more or heading out as well as taking different lessons. whether it ' s languages or scuba'diving or yoga exercise. Oh, look at that. Diving. He called it. Something that'' s going on that we function.
into our daily regimens. Now, we'' re ruling out relocating.
back to the US.But something we'' ve discovered in life is.
never state never. So we'' re really looking extra at Eastern. Europe, Southeast Asia, potentially South America. And we'' ll proceed our.
journeys until we locate our little item of heaven. Yeah, they'' re feeling really
favorable. today because their investment portfolio has actually grown over $400,000 given that.
they reached FIRE and also retired early in 2018. They have a YouTube channel that'' s. most likely making some cash. Therefore they'' re expressing this incredibly.
favorable reaction. After having that development, their.
portfolios probably dropped about 20% this year, which is much more than.
would certainly have appreciated.So I ' d be interested to see if they ' re. still inevitably feeling by doing this, however in general, they ' re in a truly fantastic. setting.
The biggest point is maintain discovering,.
keep an open mind. You don'' t need to choose your for life.
home. And also in truth, maybe you should toss that.
suggestion out the window. They have tremendous flexibility and.
flexibility. They spend their time doing things.
that they like. They like discovering new points. You can truly do that throughout the.
world. With 1 being terrible, 10 being fantastic. I'' m going to clock Dianne as well as Guillermo.
at a solid 8.75. I believe they'' ve done quite a lot.
everything right. And in truth, perhaps way too much right. And also I would motivate them not to be too.
beholden to their spreadsheets and maybe take a bit a lot more dangers in their.
life.Maybe invest
a little bit even more money, if.
Well, that'' s about it. For even more terrific video clips, make certain you.
subscribe below to CNBC Keep it. Take a look at my book, “” Financial Freedom,””.
available on Amazon or your neighborhood book shop. And take a look at.
MillennialMoney.com to find out how to make, conserve as well as invest more money so you.
can construct a life you enjoy.
I'' m Dianne as well as I ' m Guillermo.And I was 47 when we attained FIRE And I was 44 when I attained FIRE. It'' s one of the fastest growing genuine. Below'' s one of the blunders they made. I ' m actually interested exactly how they ' re. That understands, maybe they ' ve obtained some.
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