Retirement Budget - Planning Assumptions

[Mike Teavee]

With the Baht getting ever stronger & some of currencies getting ever weaker I'm interested to know what (if any) assumptions people are using when planning their retirement budget.

 

E.g. When I first planned mine (9-10 years ago) GBP was around 55:1 so I used 50:1 (very conservative I thought, it's now below 41.5:1 so I would have been out by roughly 18%)! 

 

(un)Fortunately I'm still working (but fortunately earning SGD) so still fine tuning the Budget, current assumptions are:-

• GBP FX rate will be 2 THB below current mid-rate (so today I'm planning for 39.34)
• SGD FX rate will be 1 THB below current mid-rate (so today I'm planning for 22.82)
• Annual inflation will be 4.2% (Not quite pulled out of thin air but can be treated as such)
• I'm going to live to 84 (Currently 52, 53 in a couple of months with pensions kicking in at 60 so need to plan a budget for 86 months)
• (Recently assumed) I'm going to have to keep 800K in the Bank forever (Even though I'm not retired I do have a Non-O ME on the basis of being over 50), originally I'd planned to spend this down & use the income route, so that's another approx 9k from the original planned budget gone ????

 

 

Would be very interested in hearing what assumptions other people have used & whether I've missed anything obvious (I do assume 8k a month for health insurance)

 

 

 

[allane]

You do not need to maintain B 800,000 in the bank. Three months before each annual renewal date, you need to "top it up", i.e. replace what you have spent in the preceding year.

I think you can cut your assumed inflation rate in half. If inflation does increase, the rates offered on bonds and other fixed income products will increase too.

[mogandave]

I assume I'm going to live 100.

 

My dad made it to 85 drinking heavily and smoking three packs a day.

 

I think you should assume you'll live 10 years longer than your oldest parent.