Pensions / Savings For Retirement

[Tango7]

Is there anyone here experienced in how to best save money for retirement ?

I have roughly 20 - 25 years left to work before retiring and I need to start thinking about saving for my retirement.

I will have inheritance money which I know about but I don't want to rely on that. I want to have my own savings.

What should I be doing and where is the best place to be puting my money ? I don't have a lot to save each money. Maybe 50 - 70,000 Baht a month at the moment.

I also want to have some kind of life insurance that will payout in the event of my death so that I can leave my wife with money. Maybe pay off the mortgage and have money on top.

Any advice will be most appreciated.

[smilingjim]

Is there anyone here experienced in how to best save money for retirement ?

I have roughly 20 - 25 years left to work before retiring and I need to start thinking about saving for my retirement.

I will have inheritance money which I know about but I don't want to rely on that. I want to have my own savings.

What should I be doing and where is the best place to be puting my money ? I don't have a lot to save each money. Maybe 50 - 70,000 Baht a month at the moment.

I also want to have some kind of life insurance that will payout in the event of my death so that I can leave my wife with money. Maybe pay off the mortgage and have money on top.

Any advice will be most appreciated.

In prinicpal if you are an ex-pat you will be able to enter into a long-term savings plan off-shore, wrapped around an insurance policy, set up in trust for your wife. Companies like Royal Skandia, Friends Provident etc. However you cannot go to them direct - you have to go through one of their approved agents.

You/the people leaving you an inheritance may also need to consider any potential tax liabilities on your inheritance (depending on your nationality). You need to look carefully at your situation and plan accordingly.

PM me if you'd like more info/advice. I'm a retired UK/International tax specialist and have also been involved in financial planning.

[Nemo.]

Is there anyone here experienced in how to best save money for retirement ?

I have roughly 20 - 25 years left to work before retiring and I need to start thinking about saving for my retirement.

I will have inheritance money which I know about but I don't want to rely on that. I want to have my own savings.

What should I be doing and where is the best place to be puting my money ? I don't have a lot to save each money. Maybe 50 - 70,000 Baht a month at the moment.

I also want to have some kind of life insurance that will payout in the event of my death so that I can leave my wife with money. Maybe pay off the mortgage and have money on top.

Any advice will be most appreciated.

First BEWARE OF SCUM INSURANCE/"INVESTMENT" SALESMAN they will get you some stupid "insurance-investment" scheme THAT MAKES THEM RICH! not you

Basics of investment are not that complicated.

1. pay off any credit card debt/personal loans/car loans etc. These have interest rate > than investment returns. Mortages can have redemption penalties that make paying off expensive (especially in Asia)

2. How much income do you need to support your wife/kids a month? Multiply by 20 and insure that amount. Simple life insurance NO INVESTMENT

3. Make sure you have medical insurance. Major medical is especially important. 1.5 million Baht cover should be enough in Thailand. Dental/maternity cover are expensive so you could "self insure" (ie save up)

4. Open up seperate cash savings account - put on fixed deposits as well (mix 1 month to 1 year - you can usually break FD's in an emergency - ask your bank). 6 months expenses (wel at least 3 - 6 better) should be held. Say 1 month in cash, 2 months on 1 month FD and 3 months on 1 year FD). This is to absorb major financial shocks/unemployment/major medical shocks etc etc

5. Save seperately for holidays/major purchases. Dont borrow money as interest rates are so high

Thats the "defensive" part

Consider will you retire in Thailand or back home? Bit of both? Do you trust Thailand investments? (I dont!)

6. If USA or UK national its easy to buy unit trusts (UK also investment trusts) that have expenses less than 0.5% pa (anymore dont touch - mnay investment/insurance products charge you 2.5 % pa). A simple S&P 500 tracker fund in USA will cost 0.15%. In UK M&G charge 0.3% for FTSE All Share trackers (with other costs total expenses are 0.44% pa)

7. For 20 year time horizon - invest and pretend "you lost the money". You should never need to touch investments. If you do THEN YOU ######ED UP THE DEFENSIVE PART!!!!!

8. For 5 years or less to retiremwnt bond funds prob better but I would still invest 70% stocks/30% bonds as you will live a long time in retirement

9. In the old days a man was measured by his INCOME NOT HIS CAPITAL. Say you need 1,500 USD per month in retirement. At 3% return that means capital of 600,000 USD. If British you can invest 3,600 pounds a year in a pension so you can get tax relief still! Saving 2,000 USD a month for 20 years (assuming you increase with your earnings) you will just meet that target. The 3% is the dividend income - this wil rise faster than inflation over time (typically - no gaurentees) and you will still have the capital to pass on

10. More comple planning is required if you move back and forth between countries and for tax. Avoid salesman like the plague though. You need a qualified person for this. Read up (Motley fool website) on investment. Its actually simple - slaesman make it look hard on purpose. Be careful of "offshore" as its usually an excuse for high charges.

I hope this helps

[younghusband]

Is there anyone here experienced in how to best save money for retirement ?

I have roughly 20 - 25 years left to work before retiring and I need to start thinking about saving for my retirement.

I will have inheritance money which I know about but I don't want to rely on that. I want to have my own savings.

What should I be doing and where is the best place to be puting my money ? I don't have a lot to save each money. Maybe 50 - 70,000 Baht a month at the moment.

I also want to have some kind of life insurance that will payout in the event of my death so that I can leave my wife with money. Maybe pay off the mortgage and have money on top.

Any advice will be most appreciated.

My advice is of a negative variety but I hope still helpful.On no account go anywhere near the so called investment advisors based in Thailand.I am not saying they are crooks -though some of them are-but their advice is not independent and you have no legal remedies when they screw up.They tend to market relatively complicated financial products which don't really suit the individual's need, but are ultimately driven by agent's commission.You have to ask yourself the question if Thai based financial advisors were any good, why would they be here? A few years ago this advice would have been well understood by most expats.However in the last few years some of these wide boys have been elected to Chambers of Commerce committees, sponsor internet forums and generally are a bit more sophisticated in their approach.But the objective is the same, to fleece the unsophisticated.

Life term insurance is relatively simple and you should beware any advisor who tries to sell a life insurance product with a savings element.My advice is to deal with a reputable advisor based in your home country, preferably one that specialises in expatriates needs.If you pm me I will send the details of such an advisor specialising in helping UK expats.Be cautious and look for genuine independence.If necessary ask your bank for advice.It's worth noting that many UK banks themselves run investment/insurance services for expats.Generally exercise extreme caution.

[GuestHouse]

If you are from the UK and living in Thailand, write to the UK State Pensions office Department of Work and Pensions and ask for a Pensions forcast and a Statement of Contributions.

When that arrives pay back missing years and set up annual payment of voluntary contributions.

There are promisses that the UK government are going to reduce the number of 'Contribution Years' to get a full pension down to 30 years. This is a fudge to help women out who never returned to work after having children or who volunteered to pay reduced NI Contributions.

The good news is, if the law is changed, it will work in the favour of people who have moved overseas before retirement.

However, that law is not in place yet, so until then pay voluntary contributions - It is the best pension deal going.

If however you are in the UK then take a look at low charge pension savings and PEPs, both of which offer tax advantages

And if you are in the UK and work for an employer that has a company pension scheme - Join it. They are great value and under the new laws securing company pensions they are extremely safe.

[naka]

Two things you should do.

1. Don't spend all your earnings.

2. Check out some good websites on this subject, TV is not one of them.

Here's one

Naka.

[tc101]

Best website I know of for long term saving and investing is

www.diehards.org

Another good one is:

http://clarkhoward.com/

[think_too_mut]

What should I be doing and where is the best place to be puting my money ? I don't have a lot to save each money. Maybe 50 - 70,000 Baht a month at the moment.

It was in The Financial Times couple months ago. The "magic formula" is: whatever you expect to draw every month in your retirement, you have to have 20 times that in the bank.

If you calculate inflation, then probably 23-25 times.

So, to get 40K baht every month, you would need 8 mil baht (200K US$) in some reliable bank.

[Taggart]

When it comes to life insurance, don't buy anything else, except term.

Keep costs low. Usually by diversifying with index funds or ETF's (exchange traded funds) in a portfolio.

Over the long term, 75-80% of expensive of active portfolio managers, can't beat a simple index. You can't predict in advance, which managers will be the successful ones.

Warren Buffett, probably one the greatest stock market investor's ever, has recommended indexing to the majority of investors.

Buffett's two rules:

1. Don't make mistakes.

2. Don't forget rule #1.

Don't get sucked in when the mob are chasing the next great investment theme, i.e. tech stocks in the late 90's.

Google for writer's like John Bogle, Burton Malkiel, and William Bernstein. They'll teach you the "real" world of investing.

Your enemy is inflation.

Live within your means.

Live as frugally as you can.

Diversify your portfolio amongst different asset classes.

Try, if possible, and re-invest as much as possible, at least 10-20% of your after-tax income from interest and dividends.

If the portfolio is in a tax shelter, try and re-balance your portfolio at least once every year or two, by selling off part of your best performing assets, to bring them in line, to your original percentage targets set, when you first created your portfolio. Re-invest this money, into your poorest performing asset classes. Buy low, sell high.

Don't withdraw more than 4%, (preferably 3%), from your portfolio each year, in order to have enough to last a lifetime. Even then, there are no guarantees.

Learn to do it yourself. Nobody is going to look after your money better than you.