How much you really need to retire in Thailand

[chiang mai]

Competent independent investment advice in Thailand is very rare, some UK firms of IFA's send their people here to trawl for new fodder in the knowledge that there is no regulation restrictions that will impact them. Expats Brits who genuinely live in Thailand will not be accepted for new business by onshore IFA's hence their remaining choices are slim - I'm currently in discussion with the UK FCA on this point and a directer has promised me a ruling on the use of onshore IFA's by Thailand based expats and I'll post it here when I receive it. So what does that leave, restricted market advice based in Thailand or IFA's based in Hong Kong or Singapore where regulation is strong.

Competent independent investment advice (in Thailand) is very rare.

But at least it can be found there whereas here it is almost non-existent, I used to have a UK IFA who was excellent.

[ttthailand]

How much do you really need to retire .... It is different for everyone but to cover the basics and be secure and comfortable I would say 60k and up. That should cover one bedroom condo if renting or country home with wife in safe area, health insurance, transportation ( small cheap car or pickup) or riding BTS and taxis in Bkk, and about 1k baht a day for daily food drink etc. Retirement planning is needed and should not be left up to chance. Most of all don't count on anyone other than yourself to take care of your interests, Thais have no concept about the future and will spend everything they have now and believe the future will magically take care of its self.

[xylophone]

I think one of the things that gets overlooked with regards to being here in retirement is that the lump sum amount that many of us have squirrelled away for the future, is not actually sacrosanct.

Those folks with investments in bonds and shares who are living off interest and dividends seem always to want to leave the capital/principal untouched whilst living off the interest/income generated, irrespective of how much it falls. IMO I do not want to scrimp and save in my retirement whilst leaving a lump sum in the bank for someone else to enjoy, so I regularly dip into it, when necessary.

I enjoy good wine and good food and regularly dine out at European restaurants, and I run a car and a scooter and live in a nice little apartment. In addition I support my ex-girlfriend and her daughter, so all in all I would suppose I spend about 1.2 million baht a year and unfortunately my small government pension and the poor interest rates at the moment mean that I have to dip into the principal/capital, however I have no problem with this as enjoying my retirement is, after all, what I have looked forward to for many years.

So why not do the maths and find out just how much you would need to have by way of a lump sum and any other income to make it last until your potential demise. I did the numbers and my money will eventually run out when I am about 103, and I really don't think I will be living that long.

This is an interesting little calculator and you can play around with the numbers to see how you fare............

https://www.calcxml.com/calculators/how-long-will-my-money-last?skn=#results

[bow]

Don't you people get a government old-age pension ? Mine will be quite low if I start drawing money from 61, but if i wait until 67 I will get more than I will want to spend.

But if you get sick ? I just go home and use our free health-care.

I have paid a lot of money in taxes over the years. It's time for a refund.

[KNJ]

It may be wise if your debt ( rent or otherwise ) was linked to the same currency as your investments, if you live in Thailand, then invest in Thailand. In that way you avoid FOREX risks.

As to whether or not you are comfortable investing in Thailand is another matter.

As to the argument rent or buy, there are advantages for both. Certainly buying negates the rental, however renting gives you flexibility and ensures your capital is not tied up in an asset ( I would argue that if it is your main residence, then a property is not an asset )

As to tax, talk with a UK IFA who specialises in expats, they are out there if you look hard enough.

Whether you go for some kind of drawdown on investments, or try to live off the returns, will largely be dependent on the value of that pot you have, anything less than 500k USD and it will probably need to be the former.

How much does it cost to live in Thailand that is a matter of lifestyle.

There are initial costs, running costs, and unexpected costs, and all should be considered

[Pib]

A key factor regarding your monthly spending needs is whether you rent or own a residence...and if renting the amount of monthly rent. Housing cost can be very significant portion of a person's monthly income needs unless renting really cheap.

i agree that this applies to "nominal" rent. but at the bottom line it tallies when (in case of property purchase) you consider the blocked capital with zero yield on investment plus the cost for the upkeep of the property.

I've overcome the cost of property upkeep by adopting the Thai method of only painting your residence every 20 or so years, not repairing/replacing the water pump until it burns up, generally ignoring any and all maintenance.

[Naam]

1. It may be wise if your debt ( rent or otherwise ) was linked to the same currency as your investments, if you live in Thailand, then invest in Thailand. In that way you avoid FOREX risks.

As to whether or not you are comfortable investing in Thailand is another matter.

2. As to the argument rent or buy, there are advantages for both. Certainly buying negates the rental, however renting gives you flexibility and ensures your capital is not tied up in an asset ( I would argue that if it is your main residence, then a property is not an asset )

3. As to tax, talk with a UK IFA who specialises in expats, they are out there if you look hard enough.

4. Whether you go for some kind of drawdown on investments, or try to live off the returns, will largely be dependent on the value of that pot you have, anything less than 500k USD and it will probably need to be the former.

5. How much does it cost to live in Thailand that is a matter of lifestyle.

There are initial costs, running costs, and unexpected costs, and all should be considered

1. not applicable if you are a seasoned investor because the choice of assets to invest and the restrictions are (compared to invest offshore) abyssmally low.

2. i pity people who consider their main residence an asset.

3. no advisor needed to cut all ties to your home country and forgetting about taxes. doesn't work if you are American.

4. views and mileages vary.

5.

[IMA_FARANG]

I get a U.S pension of $1740 dollars a month.....or at the current exchange rate about 63, 000 Baht monthly.

My monthly expenses are about 23,000 baht monthly.....which leaves me roughly 40,000 Baht a month

That is good enough for me.

Others might disagree,, but I am happy.

[uthaithanirules]

Bottom line, if you wanted to do it like the thais do,

2000 a month for a shack in a rural area

1000 a month utilities

No healthcare

No transport

1000 a month internet

3000 a month for food

Maybe on average another 2000 a month for unforseen stuff of the bare essentials

You could do it for under 10000 baht / US $285 a month

If you are content spending your days just sitting around on the net. No yoni as well of course

[bow]

I get a U.S pension of $1740 dollars a month.....or at the current exchange rate about 63, 000 Baht monthly.

My monthly expenses are about 23,000 baht monthly.....which leaves me roughly 40,000 Baht a month

That is good enough for me.

Others might disagree,, but I am happy.

I agree. Of course you are happy. You should be. I would be happy too.

[bow]

Bottom line, if you wanted to do it like the thais do,

2000 a month for a shack in a rural area

1000 a month utilities

No healthcare

No transport

1000 a month internet

3000 a month for food

Maybe on average another 2000 a month for unforseen stuff of the bare essentials

You could do it for under 10000 baht / US $285 a month

If you are content spending your days just sitting around on the net. No yoni as well of course

I would like to adjust the numbers a little bit.

3000/month for non-air room on or near Soi Bua Khaw.

300/month for utilities

Thai gov. health care

10/day song thaew (bath bus)

300/month internet

OK 3000/month for food

2000/month for stuff like washing powder, soap

2000/month for .... other stuff ...

Little room for alcohol and prostitutes, I admit. But if you can survive without those things. Yes, you can live in Pattaya on 12.000/month.

This is NOT meant as a troll post. I just think we need a low cost, low budget, perspective as well.

[ThaiKneeTim]

I currently churn through about 3 million per year but that is with me occupied working 60+ hours per week.

If retired I obviously have more time on my hands so north of 3 million per year would be needed.

My father in law is a retired teacher at a government college. He was the head of the English department. He has a new car worth 1 million, eats out most evenings. Has holidays to the beach every year. He gets 300,000 a year. You claim 3 million isn't enough for you - how very sad or a troll.

Your father in law needs a better paying job. 300k per year is chump change.

You need to read the post you replied to!

[Naam]

Bottom line, if you wanted to do it like the thais do,

2000 a month for a shack in a rural area

1000 a month utilities

No healthcare

No transport

1000 a month internet

3000 a month for food

Maybe on average another 2000 a month for unforseen stuff of the bare essentials

You could do it for under 10000 baht / US $285 a month

If you are content spending your days just sitting around on the net. No yoni as well of course

what's a "yoni"?

[chiang mai]

Bottom line, if you wanted to do it like the thais do,

2000 a month for a shack in a rural area

1000 a month utilities

No healthcare

No transport

1000 a month internet

3000 a month for food

Maybe on average another 2000 a month for unforseen stuff of the bare essentials

You could do it for under 10000 baht / US $285 a month

If you are content spending your days just sitting around on the net. No yoni as well of course

what's a "yoni"?

Female naughty bits.

[Don Mega]

Yoni = Vagina in sanskrit.

[Don Mega]

I currently churn through about 3 million per year but that is with me occupied working 60+ hours per week.

If retired I obviously have more time on my hands so north of 3 million per year would be needed.

My father in law is a retired teacher at a government college. He was the head of the English department. He has a new car worth 1 million, eats out most evenings. Has holidays to the beach every year. He gets 300,000 a year. You claim 3 million isn't enough for you - how very sad or a troll.

Your father in law needs a better paying job. 300k per year is chump change.

You need to read the post you replied to!

Ohhh. thats $$$ not Baht ?

[Naam]

Yoni = Vagina in sanskrit.

when i was 16 my pocket money was a fraction of 10,000 Baht a month and access to a variety of yonis was free. but then i didn't live in the vicinity of Soi Buakaow.

[55Jay]

Find some insecure "yoni" (or more than one) that'll work her little fingers to the bone to pay those 10,000/month living expenses for you.

That would put you even closer to the "living like a Thai" zone.

[Gutenberg]

I currently churn through about 3 million per year but that is with me occupied working 60+ hours per week.

If retired I obviously have more time on my hands so north of 3 million per year would be needed.

My father in law is a retired teacher at a government college. He was the head of the English department. He has a new car worth 1 million, eats out most evenings. Has holidays to the beach every year. He gets 300,000 a year. You claim 3 million isn't enough for you - how very sad or a troll.

Sad is when you want things you can't have and pretending you don't want them. Sad is when you can't give your child a good education which can cost 300-600k per year. I could go on. 3 million especially in Bangkok is a very good standard of living..nothing special.

Of course using $7000 per month is not much in Thailand, it is not even average. If you have less you will not have a good life in Thailand, you can retreat to super expensive cities like Copenhagen and need only $3000 to have a good life.

[Gutenberg]

I get a U.S pension of $1740 dollars a month.....or at the current exchange rate about 63, 000 Baht monthly.

My monthly expenses are about 23,000 baht monthly.....which leaves me roughly 40,000 Baht a month

That is good enough for me.

Others might disagree,, but I am happy.

This is above average what a German retiree would get, so nothing to disagree. It is good.

[gk10002000]

I currently churn through about 3 million per year but that is with me occupied working 60+ hours per week.

If retired I obviously have more time on my hands so north of 3 million per year would be needed.

3,000,000 baht per year? at 35 baht per USD that is 85,000 USD a year. Goodness. I can live quite well on that in the USA, never mind in Thailand. Not saying one can't spend that much per year. I am figuring on about 50,000 USD tops given my life expectancy but shooting for 40 K USD per year. It all depends on when I want to start deficit spending versus just spending my dividend and interest income which is right at 48K right now. If I work another year or two, and want to take on the risk of going stir crazy and getting too bored, I could punch out. And in two years I can start my social security also which will add about another 24K USD per year.

[GuestHouse]

A miss calculation many people make is they neglect that if they have not planned their retirement well enough they may very likely have to return to their former home/job.

Read the reports here on TVF of the number of guys who have gone home after 5, 10 or more years here. I have a unit in a condo near Pattaya, up until a couple of years ago building was full of 'retired' expats in the 40~55 age range - early retirees, with a very much smaller numberer of guys in the 60+ age range.

The younger guys have almost to a man, locked-up or sold-up and gone back home, getting back into work after an absence of 5 or more years can't be easy, getting back to being able to save and replenish your 'retirement funding' even harder.

The question is therefore not simply how much do you need to retire, but also do you understand the need to be defensive in your use of your retirement fund?

If you are taking lump sums out of your pension fund for capital purchases, a home, a car, or any big ticket item then you need to be aware of the impact that has on the future sustainability of your retirement.

[StasD]

for me alone 30 000 bat /month enough

with short-time girlfriend about 40 000

thai wife 100 000+

[xylophone]

A miss calculation many people make is they neglect that if they have not planned their retirement well enough they may very likely have to return to their former home/job.

Read the reports here on TVF of the number of guys who have gone home after 5, 10 or more years here. I have a unit in a condo near Pattaya, up until a couple of years ago building was full of 'retired' expats in the 40~55 age range - early retirees, with a very much smaller numberer of guys in the 60+ age range.

The younger guys have almost to a man, locked-up or sold-up and gone back home, getting back into work after an absence of 5 or more years can't be easy, getting back to being able to save and replenish your 'retirement funding' even harder.

The question is therefore not simply how much do you need to retire, but also do you understand the need to be defensive in your use of your retirement fund?

If you are taking lump sums out of your pension fund for capital purchases, a home, a car, or any big ticket item then you need to be aware of the impact that has on the future sustainability of your retirement.

See my post #33 and link to calculator, which can help.

[GuestHouse]

See my post #33 and link to calculator, which can help.

Yes I read your post which I think covers many of the issues and the benefits of drawdown, but omits a factor that is of significance to a lot of retired expats in Thailand - very much younger wife and children to be taken care of even after the expat husband has died.

Leaving accessible cash rather than secure income to take care of a wife and/or children might not be the best idea.

[xylophone]

See my post #33 and link to calculator, which can help.

Yes I read your post which I think covers many of the issues and the benefits of drawdown, but omits a factor that is of significance to a lot of retired expats in Thailand - very much younger wife and children to be taken care of even after the expat husband has died.

Leaving accessible cash rather than secure income to take care of a wife and/or children might not be the best idea.

Take your point GH.....was (selfishly) looking at it from my perspective!!

On the subject of investing, the OP could investigate Corporate Bonds in his own country, mixed with a smattering of shares in Utilitiies companies, which usually pay good dividends but won't show stellar capital growth, and have some invested here........never hurts to diversify across asset classes and/or markets for that matter.

[Don Mega]

I currently churn through about 3 million per year but that is with me occupied working 60+ hours per week.

If retired I obviously have more time on my hands so north of 3 million per year would be needed.

3,000,000 baht per year? at 35 baht per USD that is 85,000 USD a year. Goodness. I can live quite well on that in the USA, never mind in Thailand. Not saying one can't spend that much per year. I am figuring on about 50,000 USD tops given my life expectancy but shooting for 40 K USD per year. It all depends on when I want to start deficit spending versus just spending my dividend and interest income which is right at 48K right now. If I work another year or two, and want to take on the risk of going stir crazy and getting too bored, I could punch out. And in two years I can start my social security also which will add about another 24K USD per year.

Incredible hey. Ive no idea where it all goes.

To clarify my salary is not 3 million... the "about" part depends on bonus... average is 20k usd which helps a lot.

[GuestHouse]

Take your point GH.....was (selfishly) looking at it from my perspective!!

On the subject of investing, the OP could investigate Corporate Bonds in his own country, mixed with a smattering of shares in Utilitiies companies, which usually pay good dividends but won't show stellar capital growth, and have some invested here........never hurts to diversify across asset classes and/or markets for that matter.

I don't see your views as selfish or any less valid than my own, rather between them an indication of the wide range of issues to be considered when planning a retirement or how much one needs to retire.

I think drawdown is excellent for those who have a good state pension or a good defined benefit pension PLUS additional savings over and above their secure income.

The big hit in my view is in the early years of retirement when people are often encouraged or persuaded to take a cash lump sum from their pension pot to fund capital expenditure. People holding UK private/company pensions can (currently) take a 25% tax free lump sum, very few understand the impact that has on their future pension income.

If you are taking the cash to pay off a debt as you retire or to reinvest for a second income stream it might be a good idea but it needs very very careful examination.

Pensions are, by definition, irreplaceable.

[Bobotie]

An old school chum of mine, who is a CA and all round finanical whiz kid did some calculations for me and as a cash amount suggested i needed around 2.0 million dollars in my piggy bank

[Naam]

An old school chum of mine, who is a CA and all round finanical whiz kid did some calculations for me and as a cash amount suggested i needed around 2.0 million dollars in my piggy bank

the "whiz kid" knows all about living expenses in Thailand?