How Much Dosh Needed To Retire At Age 50?

[Jingthing]

Alot of people retire early in Thailand because they CAN retire in Thailand at an earlier age than they could at home. The more prudent of you are saying that person should continue working until he has enough to retire at home. In my view, that totally defeats the point of retiring earlier and having some younger, hopefully healthier, years of leisure. Only a small percentage of people are wealthy enough to retire early in the west, but many more could retire earlier in Thailand or like, poorer, countries.

Edited July 20, 2008 by Jingthing

[JimsKnight]

Anyone fully retiring at 50 needs to understand how boring it is doing diddly squat and stopping work then.

you can only speak for yourself. i retired 19 years ago at age 46 and my only regret is that i did not retire several years earlier

Horses for courses my teutonic friend, a rolling stone gathers no moss

[Naam]

Anyone fully retiring at 50 needs to understand how boring it is doing diddly squat and stopping work then.

you can only speak for yourself. i retired 19 years ago at age 46 and my only regret is that i did not retire several years earlier

Horses for courses my teutonic friend, a rolling stone gathers no moss

indeed, because each and every case is based on the individual and his/her priorities. but retiring does not necessarily mean the stone stops rolling. one of our 'teutonic' saying is "schoolchildren and retirees have no time". that's exactly what happened in my and some of my friends' cases. most of us wish a day had 36 instead of 24 hours enabling us to accomplish all plans we have in mind and for which we can't find the time

[bendix]

I suspect that's the case for people have are adequately provided for in retirement, Naam, hence the importance of this subject. I'm sure if you have planned well, it's easy to fill the days with hobbies, travel, and the things you love.

Sadly, I see too many completely under-funded retirees whose days stretch out ahead of them because - frankly - they can't afford to enjoy their retirement.

They've replaced one form of drudgery (employment) with another (underfunded idleness).

[Naam]

I suspect that's the case for people have are adequately provided for in retirement, Naam, hence the importance of this subject. I

a fact is that i did not plan anything Bendix. after giving up a top job which demands more or less all of the time (regularly seven days a week) one yearns to do a zillion things for which was never any time left. and when time is available it is used leisurely, e.g. an hour or two for things which had earlier to be accomplished in a few minutes or were just not done at all.

PeaceBlondie described it already in details and took the words out of my mouth.

[lawman3966]

I dont see how anyone can answer this for you,how will you live ?, where will you live ?, do you drink? smoke ? eat ? .comments and advice you will receive will surely be worthless without an assesment,..do you want to live in a pattaya penhouse or a tin shed in issan,one is definatly cheaper than the other,unless the in laws take it all off you

I'm glad this topic was revived after two years, as it appears to track the unending discussions of these topics in the U.S. media since people tend to now retire with lump sums instead of pensions.

One way of addressing the longevity risk is with Immediate Annuities. So far, these products have not been popular in the U.S., as annuities don't enjoy a good reputation (in many cases for good reason). But, I will be investigating this option in the years to come. Purchasing a stream of inflation-adjusted income that lasts for life seems easier than spending every day in retirement sweating over the latest profit reports, or the latest bank failures. Of course, the insurance company risk also has to be considered. For this reason, I would never allocate all my resources to an annuity, and certainly not to one at a single insurance company.

One approach I've read (by Walter Updegrave) recommends allocating 1/3 of retirement assets to an inflation-adjusted immediate annuity. This is done at the time of retirement. I believe his logic is that one can direct the income from this safe investment to the most basic expenses, and then invest the rest in equities to get a better long term return.

The "multiple" of the first year income one would need at age 50 according to one site is about 22 (i.e. the lump sum need to purchase the annuity, expressed as a multiple of the first year annuity income). So, according to this formula, if you needed 1M Baht per year to live, and were willing to invest all in an annuity, you could retire with a lump sum of 22 M Baht.

I suspect this product will grow in popularity as the boomers start to retire. Worth keeping an eye on.

[Nongwahyay]

Make that THB 60,000 for the vasectomy... wouldn't like to have underestimated that one...

I had a vasectomy done in Berlin 15 years ago for 600 Deutschmark....... and it hurt!!!!! Not like the stories I´d heard of going back to work in the afternoon....... perhaps that´s why it only cost 600 D-Mark..... Better plan on 75.000 THB now to make it painless..............

[Wirat]

Well, according to this poll on the website here, the majority of people chose over 40 million baht as the poll answer. GEEZ!!! I think many people who voted don't live in Thailand and are guessing, so the poll is not very accurate. I plan on retiring there with about 30 Million baht. Up in Chiang Mai. Like it or not, here I come!! I don't drink or smoke. I cant see how I would need more unless something really bad happened. If thats not enough then I cant retire anywhere and I may as well live it up until the money runs out and then come back to work, if I stay here in the US I will never be able to retire anyway. I may as well spend the money while I can enjoy it and die poor rather than work and save until I die with a fat bank account. :jap:

[pjclark1]

Here is a question for you?? Say you are already collecting 67,000 baht per month and have about 800,000 baht banked. Could you survive? That is my income for the about 8 years, then the IRA's & mutual funds will kick in.

And, yes, i am over 50. Since i am used to living (struggling that is) on the limited income in the States, i would think there would be room for me to save a little each month. Have i lost it? I'm considering Chiang Rai. What do you think? I am not planning to purchase a home right away. I saw some rentals in Chiang Rai that appear affordable.

Advice please. Thanks, Nancy

Hi Nancy

I'm in Chiang Mai and spending 45,000bht a month, that includes supporting a Thai lady and her teenage daughter.

5,000bht a month is plenty for a nice little 2 bedroom house rental, furnishing the house costs about 40,000bht if you don't require hand calved teak furniture.

(I have just about done this, moving from furnished to unfurnished)

If I were on my own, I could reduce my monthly outgoings to about 30,000bht.

Unless you are a very extravagant person, you seem to have twice as much as you need to live here.

Chiang Rai is a little quiet for me, I prefer to have the English speaking advantages gained by living near CM.

You really need to come out here and try it for a couple of months.

Get a condo for about 5000bht a month and see how things go!

[Naam]

Well, according to this poll on the website here, the majority of people chose over 40 million baht as the poll answer. GEEZ!!! I think many people who voted don't live in Thailand and are guessing, so the poll is not very accurate. I plan on retiring there with about 30 Million baht. Up in Chiang Mai. Like it or not, here I come!! I don't drink or smoke. I cant see how I would need more unless something really bad happened. If thats not enough then I cant retire anywhere and I may as well live it up until the money runs out and then come back to work, if I stay here in the US I will never be able to retire anyway. I may as well spend the money while I can enjoy it and die poor rather than work and save until I die with a fat bank account. :jap:

you never thought of investing the money and use the proceeds to pay for your living expenses?

[flying]

you never thought of investing the money and use the proceeds to pay for your living expenses?

This question seems to come up often doesn't it?

meaning how much to retire in LOS

Seems there would be no one answer fits all. But of course if someone has the smart to work what they got & do as you said it would be the best solution.

Hi Nancy

I'm in Chiang Mai and spending 45,000bht a month,

Boy Nancy posted that question close to 5 years ago, Wonder if she is still about?

[PattayaParent]

Thaiquila, if we can guess the interest rate and number of year this fund will take to exhaust itself, then any Excel spreadsheet can be used to compute the present value.

For example, if we say a person needs 0.8 million baht (same as one of the visa requirements for retirement income) per year, for 35 years, dying at age 85.

The formula is =PV(RATE,PERIODS,BAHT). 800K per year requires 10.3 million baht to fund at 7%. Insert rate as 0.07, so it's =PV(0.07,35,800000). Use no commas on the baht amount.

Now I would know what to choose for the poll, ten million, if only I could live on 67,000 baht per month. I actually spend a third more than that, so I'd need 13.4 million baht.

I spent a lot of time between ages 55 and 56, computing this, with each one of my pensions kicking in at different ages, etc. Then I got the H.ell out of Dodge (I quit the IRS). The pension calculations themselves were as difficult as any income tax computation I ever did.

Financial advisers have a programme that can easily calculate it for you. It's called the 'Monte Carlo' calculator.

[Jessada]

I seriously don't know how people come up with that large amount of money needed to live on in Thailand (unless you want to live a high life in BKK , live & eat @ the 5star hotel or restaurant, and shop only @ the Emporium), look at the Thai people , how much they earn and live with monthly (comfortably or not). Being a Thai myself, have lived in a few different countries, I think people always live beyond their means.

As long as you are healthy, the major expenses would be purchasing a home /car etc. For a small town like ChiangRai you can rent a good home for 4-5,000 bath, cheap food, beer, clothing and meds. Education? Again if you decide to enroll your children in those fancy international school then you defenitely need extra fund to be available.

Living costs in Thailand are reasonably low compared to many countries, depending what your standard of living is, I don't see how people can not live with 30-60,000 bath a month when the local makes a lving with 150 bath a day ??

Maliwan

[kokesaat]

14 years, wife and myself, bought 3 rai at 450,000, built a home for 1.2mil, furnished it, live well but don't stand out in our village, 3 new trucks over the years, multiple vacations to the US and multiple paid vacations for our daughter to visit, a couple grand to help our daughter with education in the US, full time gardener, average electricity bill 2200 baht. UBC gold.

Overall average all costs included over 14 years: $2300/month (ranging from 25/1 to 48/1 exchange rate)

No health expenses paid out of pocket.

[Naam]

I seriously don't know how people come up with that large amount of money needed to live on in Thailand (unless you want to live a high life in BKK , live & eat @ the 5star hotel or restaurant, and shop only @ the Emporium), look at the Thai people ,<snip to concentrate on the important>

this topic crops up every now and then because some people "seriously" don't take into consideration that "serious" taxmen in a number of other countries claw "seriously" up to 50% of any income out of the pockets of people who live there.

somebody with "seriously" more money than the OP mentioned can finance a "seriously" comfortable, or even a "seriously" luxurious, life style in Thailand (plus much more) by using not a single penny except the "serious" taxes which he does not pay.

[fletchsmile]

For me, Home + Car already paid for, then on top:

50mio - ish = 45mio investment portfolio + 5mio THB cash

Based on THB 150k a month with: 7% total annual return on 45mio portfolio, with 4% take out and 3% reinvested for inflation.

The 5mio in cash ensures you can ride any bad years in an economic cycle where returns are negative, eg 2008 financial crisis, so you have approx 3 years money liquid.

Investment portfolio would hopefully be passed on to wife + kids at death. So 2 kids eventually are half set for life

[Naam]

For me, Home + Car already paid for, then on top:

50mio - ish = 45mio investment portfolio + 5mio THB cash

Based on THB 150k a month...

the resident tarring, feathering, stoning, hanging brigade is getting ready for you Fletch!

[fletchsmile]

For me, Home + Car already paid for, then on top:

50mio - ish = 45mio investment portfolio + 5mio THB cash

Based on THB 150k a month...

the resident tarring, feathering, stoning, hanging brigade is getting ready for you Fletch!

Can't be any worse than the Mrs on a bad day

[Wirat]

Well, according to this poll on the website here, the majority of people chose over 40 million baht as the poll answer. GEEZ!!! I think many people who voted don't live in Thailand and are guessing, so the poll is not very accurate. I plan on retiring there with about 30 Million baht. Up in Chiang Mai. Like it or not, here I come!! I don't drink or smoke. I cant see how I would need more unless something really bad happened. If thats not enough then I cant retire anywhere and I may as well live it up until the money runs out and then come back to work, if I stay here in the US I will never be able to retire anyway. I may as well spend the money while I can enjoy it and die poor rather than work and save until I die with a fat bank account. :jap:

you never thought of investing the money and use the proceeds to pay for your living expenses?

Hi Naam,

Sure, I would absolutely keep the money invested in a conservative portfolio (that's where it is now) and try to live only off the interest without touching the principle. It's just that I have been to the Chiang Mai area on vacation for a month at a time for 3 or 4 years and I cant really estimate the cost of living there that way. I met people who live there and have been told you can live comfortably by Western standards for $2000 US and live very well by Western standards for $3000 per month. I know one person who is retired from the US, he bought a furnished house (Thai wife) for about 2 Million bht, has 3 motorcycles and a car and said he spends about $2,500 US per month. But he has already paid for those things. His cost of living is utilities, food, medical bills, etc. When I drive around out by the airport and near Hang Dong you see these new housing communities going up with billboards that sell for up to 14 Million bht, so I just dont know. I couldnt believe some of those places were that expensive. They must be looking for big fish...

I would be perfectly happy in a smaller 3 bedroom single-level house in a quiet area and have a car. I actually like the Samoeng area. Other than that, it is just my wife and I. We would rent not buy because we are not Thai nationals. I guess you could say I am used to a "Western standard of living", but not sure what that means because I have been to people's homes in Thailand that are as nice as, or better than what I live in now in the US. I would think most Thais would accept a higher standard of living too if they could afford it. I am a middle-income person living in the US and expect in Thailand my retirement would let me live there at that standard or a little higher.

I just thought 40 million baht from the most popular estimate in the poll was very high for what most people plan to do, don't you? That's over $1 million US, and even here that amount is a decent nest egg for retirement. I suppose if you want to buy a condo in Phuket on the beach it might not be enough, but for me it will have to do!

Even if I had lots of medical bills, Thailand would still be the better choice because medical care is cheaper there. So I dont see how the medical bill argument would make a difference for those who have health problems. The cost here for the same care in the US is probably double or triple as much so if I cant afford the medical care in Thailand, I am certainly not going to be able to afford it here.

Thanks for your input. -Wirat

[Naam]

I just thought 40 million baht from the most popular estimate in the poll was very high for what most people plan to do, don't you? That's over $1 million US, and even here that amount is a decent nest egg for retirement. I suppose if you want to buy a condo in Phuket on the beach it might not be enough, but for me it will have to do!

Wirat,

the poll referred to people who retire at age 50, i.e. longer life expectancy, more years of inflation and was done nearly five years ago when the Baht was much weaker than today. on top of that you have to take into consideration the high number of clowns who clicked on "40 million" but will never own that kind of capital. the chaps in Chiang Mai who told you

you can live comfortably by Western standards for $2000 US and live very well by Western standards for $3000 per month

are only partly correct! it all depends how one defines "comfortably" and "very well". from a number of postings in this forum and from personal acquaintances i know that some retirees live a comfortable life with less than $ 2,000 a month, in some cases with much less, especially in rural areas.

what i gather from your posting is that you made a fair evaluation of the situation and you don't have "bugs crawling in your brains" (as we say in my home country Germany). therefore my advice is "go ahead!"

[ESB7]

How long is a piece of string???...........it really depends on where, who with and what you intend doing.......if you stayed in Phuket and lived with an x lady of the night from Bangla that you needed to 'take care family' and she didnt work anymore, probably in the region of 100,000 Baht...however if you lived in Cha am you can rent a reasonable house for 5,000 a month, meet a lady that has a 'proper job' and contributes to living expenses then you only need 25,000 baht....of course if you want to travel and live it up in the bars and clubs it would be a lot more....

[Wirat]

Thanks for the replies. It is really hard to say, but I think I will be OK. I have a few years left here and then I will apply for the O visa. I must work here until I am 55 anyway, so I should have more than enough by then. I don't plan on supporting a new Thai girlfriend or wife, ( or their family, or a sick water buffalo, ;)etc.) but to each his own. My $$ should last that way. Regards, -Wirat

[ExpatJ]

I dont see how anyone can answer this for you,how will you live ?, where will you live ?, do you drink? smoke ? eat ? .comments and advice you will receive will surely be worthless without an assesment,..do you want to live in a pattaya penhouse or a tin shed in issan,one is definatly cheaper than the other,unless the in laws take it all off you

I'm glad this topic was revived after two years, as it appears to track the unending discussions of these topics in the U.S. media since people tend to now retire with lump sums instead of pensions.

One way of addressing the longevity risk is with Immediate Annuities. So far, these products have not been popular in the U.S., as annuities don't enjoy a good reputation (in many cases for good reason). But, I will be investigating this option in the years to come. Purchasing a stream of inflation-adjusted income that lasts for life seems easier than spending every day in retirement sweating over the latest profit reports, or the latest bank failures. Of course, the insurance company risk also has to be considered. For this reason, I would never allocate all my resources to an annuity, and certainly not to one at a single insurance company.

One approach I've read (by Walter Updegrave) recommends allocating 1/3 of retirement assets to an inflation-adjusted immediate annuity. This is done at the time of retirement. I believe his logic is that one can direct the income from this safe investment to the most basic expenses, and then invest the rest in equities to get a better long term return.

The "multiple" of the first year income one would need at age 50 according to one site is about 22 (i.e. the lump sum need to purchase the annuity, expressed as a multiple of the first year annuity income). So, according to this formula, if you needed 1M Baht per year to live, and were willing to invest all in an annuity, you could retire with a lump sum of 22 M Baht.

I suspect this product will grow in popularity as the boomers start to retire. Worth keeping an eye on.

Interesting post. I have recently been looking at annuities- and i agree with you they can provide a good constant monthly income stream which takes away alot of stress in retirement i imagine. The formula i see on various websites is that 100,000 USD invested in an annuity normally gives about 6,000 USD per years - so 400,000 USD would give you a monthly income of 2,000 USD. This is my target and it would be a supplment to my company pension and my rental property incomes- the rest of my savings would go into stock markets (high dividend stocks).