Too Young To Retire!

[dutch]

and I have to disagree with you

I just got information from dutch tax office that my retirement pay will be paid out GROSS.They also informed the pension funds involved.

I will be taxed by the Thai tax office.

I will have to prove to the dutch authorities that I did pay.Otherwise they will inform the pension funds to deduct the dutch tax and I will be taxed retrospective.

My next control date has been set for february 2008.

I have no problem paying Thai tax.

[lopburi3]

and I have to disagree with you 

I just got information from dutch tax office that my retirement pay will be paid out GROSS.They also informed the pension funds involved.

I will be taxed by the Thai tax office.

This is for you because you are bringing in current payments. Most retired people pay tax in their home country on pensions and are exempt from Thai tax by international treaties (it is normal to pay tax in country making the payment). In cases where there is no treaty you should bring in savings from a previous year rather than current payments. In your case the tax here is probably in your favor using this system (I assume high tax in your home country).

[RDN]

I have no problem paying Thai tax.

In your case the tax here is probably in your favor using this system (I assume high tax in your home country).

Please don't assume anything without checking. In your own country your pension will not go far and you will be considered relatively poor, and therefore taxed very little. In Thailand your pension money will make you "rich" by Thai standards, and therefore taxed highly.

[DogNo1]

ghengis:

I am curious about the "inflation proof" annuities in the UK. In the US, lifetime annuities are available that will pay you about 5% of your investment for the remainder of your life after age 60, but they have no built-in increase for inflation. That's dangerous because inflation can make the 40,000 K mentioned by some as a livable amount worth a lot less.

I have been investing in stocks because I wnated to stay ahead of inflation. Actually, I'm far behind it. I have done a bad job of investing, actually managing to lose about 30% of my portfolio, so annuities are starting to look attractive. Some posters to Thaivisa have said that you can survive on 40,000K - a 4% return on $300,000. That would be tricky if prices in Thailand increase either due to inflation or due to wealthy Asians retiring in Thailand. Actually, retirement in Thailand is looking very attractive to Japanese and I've heard of Japanese retirement villages planned for the Lampang-Chiang Mai area.

It seems to me that anyone planning on retiring in Thailand should make allowances for the bite on income that taxes, inflation and unexpected expenses can take. I personally wouldn't consider moving to Thailand to retire unless I had a monthly income of $2,000 plus a little extra to save up for the unexpected. If I couldn't live comfortably and afford occasional trips and purchases of big-ticket items, I wouldn't enjoy the retirement very much. But that's just me. Possibly some people could get by on a lot less and be content with the lifestyle that they would have.

[ProThaiExpat]

ermooney: The issue with me was where could I live at the lowest cost and have an enjoyable lifestyle to go with it. Thailand was an easy choice.

Everything you mentioned that could happen in Thailand in the future has happend and will happen anywhere else you choose to live.

I was living in a condo in Honolulu with a mortgage and one of the highest costs of living anywhere.

The equity in my newly acquired condo bought me a custom made home here in Thailand and paid for my new car. So I live a lot better, for a lot less here and even with the airconditioning running all the time, my electric bill is still less than in Hawaii.

It was an easy decision for me. Unless your home and car are paid for where you live now, I would sure like to hear from you where else is competing, in your mind, with Thailand as a cheaper place to live?

[lopburi3]

Please don't assume anything without checking. In your own country your pension will not go far and you will be considered relatively poor, and therefore taxed very little. In Thailand your pension money will make you "rich" by Thai standards, and therefore taxed highly.

As I do not know the details of his income that would be rather hard to do. I do know the max tax rates can be very high in Europe and believe the Dutch max rate is something over 50%. The Thai max rate, as I recall, is lower.

[rcjoop]

Please don't assume anything without checking. In your own country your pension will not go far and you will be considered relatively poor, and therefore taxed very little. In Thailand your pension money will make you "rich" by Thai standards, and therefore taxed highly.

As I do not know the details of his income that would be rather hard to do. I do know the max tax rates can be very high in Europe and believe the Dutch max rate is something over 50%. The Thai max rate, as I recall, is lower.

This is a common misconception about Dutch tax levels, those are actually rather low and perhaps lower than Thai income tax.

For a taxable pension/income of € 29,543 you pay only € 1212 in taxes. What is costly is the amount of social security and health related premiums those amount to 32.4% of this gross income (until age of 65), but upon moving to Thailand you no longer have to pay for those.

If you earn (much) more then it might get costly as after € 29543 taxes jump to 42% but you no longer pay extra for social and some health insurances.

Wonder what income tax you pay in Thailand for a taxable income of almost 1.5 mil. baht

[RDN]

Please don't assume anything without checking. In your own country your pension will not go far and you will be considered relatively poor, and therefore taxed very little. In Thailand your pension money will make you "rich" by Thai standards, and therefore taxed highly.

As I do not know the details of his income that would be rather hard to do. I do know the max tax rates can be very high in Europe and believe the Dutch max rate is something over 50%. The Thai max rate, as I recall, is lower.

Sorry lop, I was quoting you, but my post was aimed at Dutch. No offence intended.

[dutch]

RDN

I think rcjoop nicely explained the basics.

Without going into detail,I would not retire on a annual income of Euro 30.000,-

At the end it is simply a question of calculation.

I had KPMG calculating the possibilities based on the personal facts and they more or less confirmed my own observations.

rcjoop.

There is information on Thaivisa.com.first page

Tax in Thailand-personal income tax.

[lopburi3]

Sorry lop, I was quoting you, but my post was aimed at Dutch. No offence intended.

None taken. That is the danger in these forums as we act and react on words that can often be read in various ways. No body language to guide us here.

[mbkudu]

As to 20 - 25 times your expenditure I would only hold that as safe if you are late in life... for me I would not even think about retiring without 50 - 80 times my annual expenditure at this stage of life..

Sure, assume you will live 'til 80, and have enough money to live 'til then.

John needs to look at real visa's not tourist 30 day stamps which technically prevent car ownership, bank accounts, internet banking (at my bank anyway), and many many more things that make you a second class citizen.

I did manage to get a bank account with just a 30 day stamp in my passport, but I have heard it is getting more difficult now.

As I have stated many times in various threads I dont know why there is no visa for those that wish to just bring money into Thailand and spend it ?? Set the bar high and say we need to bring 1 mil baht into the country each year !!

But there IS a way of doing this. Get a non-immigrant visa and transfer 3 million to a Thai bank and you qualify for a "temporary stay" of one year, renewable every year. You can buy a condo if you like with the money or just leave it there, in the bank. This is what I was going to do before they lowered the retirement visa age to 50, so I went for that instead.

Use the search facility on the site - I'm sure this has been discussed before.

In this thread (12th post, page 1) I outlined what one can do to get a ONE YEAR

EXTENSION on an existing visa with proof of 3,000,000 million Baht in Thailand.

Some people on this forum are just ####### mindless! What more do we need to do to show you that there is a way.

[rcjoop]

Without going into detail,I would not retire on a annual income of Euro 30.000,-

At the end it is simply a question of calculation.

I had KPMG calculating the possibilities based on the personal facts and they more or less confirmed my own observations.

Hmm Dutch now you have me worried as I intend to move to Thailand and live on an income of 30 to 40 k€ a year and had the impression this was enough for a comfy life.

Here on these forums I often see remarks about living on 40 kBaht a month with ease. However I never saw an actual budget so it is hard to judge if my assumptions are correct.

My monthly budget in Baht is as follows and please comment if there are unrealistic elements in it.

Rent: 15 to 25 KB, electricity, phone, water 7 k

Transport: car depr. 6 k, insurance, gas etc 6 k, honda dream 1k

Insurances, mostly health: 8k

Food etc, eating out, domestic/garden help 25 to 35 k

Clothing, appliances repairs 8 k

Entertainment, golf, vacations 20 kbaht

Totalling 105 to 120.000 Baht a month

I was hoping to live an easy life without worrying too much about money, can I ??

[dutch]

rcjoop,

Don't worry,that amount looks fine.I think many would like to be in that position.

Everybody sets its own bar.

Where are you planning to retire and when if I may ask?

[dutch]

rcjoop,

Look also at the "cost of living in Thailand" thread ,that is now running.

Other opinions and ideas.

[RDN]

Some people on this forum are just ####### mindless! What more do we need to do to show you that there is a way.

Jai yen yen, mbkudu! I did suggest to George or any moderator that the "search" button should be made more prominant and the registration email - sent to all newbies - should tell newbies to search first for a subject before posting.

Having said all that, I do find that the search facility could be improved - for example giving the results of the search in the form of individual posts and not just threads. Sometimes the threads are so long you cannot find the post with the word you are searching for. And searching for multiple words, not phrases, would be useful. Or maybe I'm not doing it right.

Any comments from George or other moderator?

[rcjoop]

rcjoop,

Don't worry,that amount looks fine.I think many would like to be in that position.

Everybody sets its own bar.

Where are you planning to retire and when if I may ask?

Dutch,

I will retire in Chiang Mai, hopefully in the second half of next year.

Will be in Chiang Mai for 3 month starting mid-december this year to have the last reality check and look at some parts of greater Chiang Mai to get a feel of how it will be to live in specific parts of the city.

Probably will have some more questions about living in Chiang Mai but will post them in the appropriate forum, Joop

[BobAnderson]

Somebody asked, " Unless your home and car are paid for where you live now, I would sure like to hear from you where else is competing, in your mind, with Thailand as a cheaper place to live?"

The Philippines is a competitor. Prices, outside Manila, are comparable. One BIG plus is tourist visas that are good for ONE YEAR. You renew monthly for US$20 at immigration - visa run one a year. No problem.

[Boon Mee]

Somebody asked, " Unless your home and car are paid for where you live now, I would sure like to hear from you where else is competing, in your mind, with Thailand as a cheaper place to live?"

The Philippines is a competitor.  Prices, outside Manila, are comparable.  One BIG plus is tourist visas that are good for ONE YEAR.  You renew monthly for US$20 at immigration - visa run one a year.  No problem.

The food is better in Thailand

[lopburi3]

The food is better in Thailand 

You're not a Balut fan?

[DogNo1]

ProThaiExpat,

Actually there is no other place I know of that can compete with Thailand for its reasonable cost of living and quality of life. I get newsletters all the time about retirment in Central and South America, the Caribbean and Europe. I also have a friend who is retired in Portugal, which he says is good, but I wouldn't consider any place except Thailand. I had hoped to retire in California to be near my grandkids but have decided that it will be cheaper to visit them once or twice a year from Thailand while enjoying a higher quality of life than I could have in the US for the same money. One important thing to me is that I will be able to afford good health care, even paying for it out of my own pocket. The point I wanted to make is that it is good to retire with adequate income so that you don't run out of money eventually. Of course the options for getting by on relatively little money are much, much better in Thailand than in Hawaii or California. The Philippines are OK, but like you ( I assume from your moniker), I really like the Thai people and Thai culture. And the food IS better.

BTW, I really appreciate all of the information and opinions available on this site. My thanks to all for your feedback and observations.

[Khun Larry]

As to 20 - 25 times your expenditure I would only hold that as safe if you are late in life... for me I would not even think about retiring without 50 - 80 times my annual expenditure at this stage of life..

As for the 20 - 25 times this is the amount you need to maintain your principle in perpetuity. So you can retire anytime if you have 25x what you spend annually. Naturally you need to invest the principle. This is the equilibrium withdraw point.

A base principle of 50 - 80x will just increase in value as the draw out will be less than the expected investment return.

Chookdee na

[RDN]

As to 20 - 25 times your expenditure I would only hold that as safe if you are late in life... for me I would not even think about retiring without 50 - 80 times my annual expenditure at this stage of life..

As for the 20 - 25 times this is the amount you need to maintain your principle in perpetuity. So you can retire anytime if you have 25x what you spend annually. Naturally you need to invest the principle. This is the equilibrium withdraw point.

A base principle of 50 - 80x will just increase in value as the draw out will be less than the expected investment return.

Chookdee na

Exactly right! 25*annual expenditure is enough. It means you only have to make 4% net on your investment and spend it (4%) to maintain your investment. And this 4% should be tax free (5% is in the UK). So 25,000,000 baht invested in bonds will give you 1,000,000 every year to live on.

[Khun Larry]

I personally wouldn't consider moving to Thailand to retire unless I had a monthly income of $2,000 plus a little extra to save up for the unexpected.  If I couldn't live comfortably and afford occasional trips and purchases of big-ticket items, I wouldn't enjoy the retirement very much.   

Yes, $2000 seems to be a very comfortable number.

Most annuities have high fees. Stick with the stocks, 100+ years of data shows over time they will provide a return over and above inflation.

[jmkiser]

As to 20 - 25 times your expenditure I would only hold that as safe if you are late in life... for me I would not even think about retiring without 50 - 80 times my annual expenditure at this stage of life..

Sure, assume you will live 'til 80, and have enough money to live 'til then.

John needs to look at real visa's not tourist 30 day stamps which technically prevent car ownership, bank accounts, internet banking (at my bank anyway), and many many more things that make you a second class citizen.

I did manage to get a bank account with just a 30 day stamp in my passport, but I have heard it is getting more difficult now.

As I have stated many times in various threads I dont know why there is no visa for those that wish to just bring money into Thailand and spend it ?? Set the bar high and say we need to bring 1 mil baht into the country each year !!

But there IS a way of doing this. Get a non-immigrant visa and transfer 3 million to a Thai bank and you qualify for a "temporary stay" of one year, renewable every year. You can buy a condo if you like with the money or just leave it there, in the bank. This is what I was going to do before they lowered the retirement visa age to 50, so I went for that instead.

Use the search facility on the site - I'm sure this has been discussed before.

In this thread (12th post, page 1) I outlined what one can do to get a ONE YEAR

EXTENSION on an existing visa with proof of 3,000,000 million Baht in Thailand.

Some people on this forum are just ####### mindless! What more do we need to do to show you that there is a way.

Touché mbkudu, you hit the nail right on the head dude! I just found my way out of Alaska for good! Check this out guys, and I hope many of you can fulfill your dreams in the near future.

http://www.thaiimmigration.com/inv/index.php?showtopic=89

Regards,

John from Alaska

[Jeff Jarvis]

Here is a good retirement calculator. It will back test your retirement investment plan over 100 years.

How long will the money last?

http://capn-bill.com/fire/index.asp