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Retirement planning (How much do we need or what do we need?).

Monday, August 9, 2010

Recently, I was asked a question on how much do we need for retirement?

It is one of those questions which seem easy to answer but, if we spend more time thinking about it, we realise it is actually not that easy.





I talked about needs and wants in another post earlier.  

What are needs and what are wants? 

See:
Money management: Needs and wants.

There are certain basic needs in life but there are many wants which have become needs in modern society. 

Therefore, how much do we need for retirement could depend on how many wants we have in life, wants which have been internalised as needs over the years.

An important question to ask is, then, what do we need for retirement? 

This is a qualitative question and needs to be answered.  Otherwise, we cannot start estimating how much do we need for retirement.  

So, the person who put the question to me was left scratching his head as I gave him not an answer but another question.






Very often, people wonder how much they need for retirement, wonder if a million dollars is enough or maybe two million dollars.  

They should think about what they really need in life and what would they be contented with.  

Perhaps, they should not keep chasing after that first million.  

Perhaps, they should not keep thinking about how much do they need.  

Perhaps, they should think of what they really need instead.

Planning for retirement? 

You might want to read these:
1. Inflation adjusted retirement plan.

2. POSB ManuRegular Payout better?
3. Selecting a good financial adviser.
4. OCBC BCIP.
5. POSB INVEST SAVER.
6. A cornerstone in retirement funding.
7. Wealthy nation cannot afford to retire?

6 comments:

PanzerGrenadier said...

Hi AK71

We actually need very little if we are happy with what we have and are in good health and our children are independent. I am trying to simplify my life bit by bit and hope that when I am in my 60s, I can carry everything I own in my life (other than car and house) in just 1 luggage.

Be well and prosper.

AK71 said...

Hi Panzer,

Yup, decluttering, my sister calls it. ;)

Everything I own in one luggage? OK, I am gonna find the largest Samsonite case available. ;-p

Passive Income Builder said...

Simple needs = simple life.

AK71 said...

Hi PIB,

Simply beautiful. ;p

AK71 said...

The video is very good in more ways than one.

I suggest watching it. :)

AK71 said...

Reader:
How do you determine if money is enough to last your lifetime? Do you have any formula?

AK:
We have to determine how much do we need per month first. Then, we will have an idea.

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