Retiring with 16mn Baht

[evilebxxx]

My elec/'phone/internet/TV/gardening bills come to more than half of your 15,000 bht p.m.  Yes, I could reduce these costs - but prefer not to do so.  my half of that, food bill monthly at 5000 baht - shooping at Big C, for farang food. I'm alone my house, except 3 semi tame 3 cats, which also eats farang food

[Scotwight]

On 8/18/2016 at 10:05 PM, Naam said:

i have no idea why anyone would rent.

 

[Scotwight]

6 hours ago, up-country_sinclair said:

This really isn't complicated.  Rent for at least a year, put the majority of the money in a low to moderate risk investment portfolio, get health insurance, find a part time job, find a good woman, live within a budget.

What is a low to moderate risk investment portfolio?  Where does an old guy get health insurance?  In my opinion those two things are almost impossible.  But I'll be more than happy to learn otherwise.  Feel free to post I am sure many will want to read. 

[up-country_sinclair]

49 minutes ago, Scotwight said:

What is a low to moderate risk investment portfolio?  Where does an old guy get health insurance?  In my opinion those two things are almost impossible.  But I'll be more than happy to learn otherwise.  Feel free to post I am sure many will want to read. 

 

 

I'm glad you're happy to learn, son.  Now let's see if you're willing and capable to do anything with the information I've included below.

 

1. There are plenty of fixed income investment options that can be defined as low to moderate risk.  He could set up a bond ladder or look into any of the scores of the low cost ETFs that are designed to preserve capital.  For example:

 

http://etfdb.com/type/investment-style/low-volatility/

http://www.etf.com/channels/fixed-income-etfs

 

 

2.  The person in question is 50 years old.  I don't know of a single health insurance provider that would deny coverage to someone solely because of being 50 years old.  

[sezze]

6 hours ago, dick dasterdly said:

As always, it depends on the person.

 

My elec/'phone/internet/TV/gardening bills come to more than half of your 15,000 bht p.m.  Yes, I could reduce these costs - but prefer not to do so.

 

Similarly, I prefer to eat Western food and even though I generally cook it myself - still pay more for foods that are closer to my definition of 'acceptable'.

 

Plus, if we have a pet/s - we have to buy them good quality food/protection against heart worm, ticks., vet bills etc. etc.

 

And that's without taking into consideration health insurance - which starts off expensive, and gets more so the older we get.

In gardening bills i think you mean watering or do you spend a lot more, like having a swimming pool or a gardener ?

elec even with aircon i come up to 2000 in hot season and close to 1000 in cold .

Internet , around 1000 baht a month gives you not the cheapest package and enough to do everything you like .

Phone , internet and tv can be coupled to give you good combining rates ( not possible everywhere in Thailand ) .

Pets , it is all up to your choice , but standard pets are not expensive to maintain , but it sure adds up to your bill .

 

Now food .

Potatoes : around 35 to 40 baht /kg . Pork between 100 and 200 baht/kg . Vegetables something from a few baht upto whatever . Chicken is cheaper then pork . Beef is more expensive . Soup i make myself , especially tomato soup easy and cheap .

Lets say a standard western meal , 250 gr potatoes 12baht + 250 gr pork 40 baht + stringbean and a milk sauce stringbean 10baht orso and lets say 10 baht for the milk .

rounds up to 75 baht roughly . I think and i believe that is a decent meal cooked yourself and i make this regularly ( changing the vegetable to cabage or something else , price roughly the same ).

Fruit : Lets say 20 baht a day gives you 2 pieces or orange or similar .

Morning  bread standard forgot the price but 5 baht a slice comes pretty close if i remember . 4 slice is 20 baht together with 3 eggs at 4baht= 32 baht . Changing the eggs with jam or mackerel tomato sauce does not make any difference in price .

I am now at 127 baht , having a big meal , 2 piece of fruit , a breakfast , and i am very sure i will not have any energy or vitamin shortages . You need to add the coffee , Nescafe Red cup 10 baht a day ? ( that is allready more then a few coffees ), and a big bottle of coke 25baht @1.25l . I'm at 163baht . And that is western food not cutback on anything .

So not possible you say ?

Sure you want to add in 10 bottles of beer a few times a week then the bill adds up , same like the lobster :-)) .

 

[Scotwight]

29 minutes ago, up-country_sinclair said:

 

 

I'm glad you're happy to learn, son.  Now let's see if you're willing and capable to do anything with the information I've included below.

 

1. There are plenty of fixed income investment options that can be defined as low to moderate risk.  He could set up a bond ladder or look into any of the scores of the low cost ETFs that are designed to preserve capital.  For example:

 

http://etfdb.com/type/investment-style/low-volatility/

http://www.etf.com/channels/fixed-income-etfs

 

 

2.  The person in question is 50 years old.  I don't know of a single health insurance provider that would deny coverage to someone solely because of being 50 years old.  

Tough sailing: The case against buying low-volatility ETFs 

http://www.marketwatch.com/story/tough-sailing-the-case-against-buying-low-volatility-etfs-2016-06-08

 

The distance between 50 and 65 is very short and perhaps you should price full health plans for a 65 year old with a previous history

 

Bank or CD or Money market or something like that is the only choice of a guy who does not have enough cash to lose and some kind of national health insurance is the only choice for insurance.  Most retired guys know this. 

 

Rich guys or younger guys no problem ask Naam he'll tell you how get top dollar on a used luxury car and such.

 

BTW you don't want to call me son unless you are 110 years old.

 

Edited August 21, 2016 by Scotwight

[MyFrenU]

47 minutes ago, up-country_sinclair said:

 

 

I'm glad you're happy to learn, son.  Now let's see if you're willing and capable to do anything with the information I've included below.

 

1. There are plenty of fixed income investment options that can be defined as low to moderate risk.  He could set up a bond ladder or look into any of the scores of the low cost ETFs that are designed to preserve capital.  For example:

 

http://etfdb.com/type/investment-style/low-volatility/

http://www.etf.com/channels/fixed-income-etfs

 

 

2.  The person in question is 50 years old.  I don't know of a single health insurance provider that would deny coverage to someone solely because of being 50 years old.  

Wow a bunch of ETFs the best performing of which is up by a a massive 0.62% ( SPDR Russell 1000 Low Volatility Focus ETF) and most of them are down!
Don't give up the TEFLing day job teacher,we are obviously not ready to learn!

[up-country_sinclair]

44 minutes ago, Scotwight said:

Tough sailing: The case against buying low-volatility ETFs 

http://www.marketwatch.com/story/tough-sailing-the-case-against-buying-low-volatility-etfs-2016-06-08

 

The distance between 50 and 65 is very short and perhaps you should price full health plans for a 65 year old with a previous history

 

Bank or CD or Money market or something like that is the only choice of a guy who does not have enough cash to lose and some kind of national health insurance is the only choice for insurance.  Most retired guys know this. 

 

Rich guys or younger guys no problem ask Naam he'll tell you how get top dollar on a used luxury car and such.

 

 

 

Son, I don't know what your problem is, but I do know that you're not mine.  

 

Enjoy being miserable.

[up-country_sinclair]

24 minutes ago, MyFrenU said:

Wow a bunch of ETFs the best performing of which is up by a a massive 0.62% ( SPDR Russell 1000 Low Volatility Focus ETF) and most of them are down!

 

The point raised was regarding low to moderate risk investments.  Apparently you're not aware, but low risk is most likely to result in a low return.  

 

If the OP wants to preserve his capital, then a low to moderate risk investment portfolio would be a reasonable option.  You're certainly entitled to disagree.  It bothers me not one whit.

[Naam]

8 hours ago, evilebxxx said:

My elec/'phone/internet/TV/gardening bills come to more than half of your 15,000 bht p.m.  Yes, I could reduce these costs - but prefer not to do so.  my half of that, food bill monthly at 5000 baht - shooping at Big C, for farang food. I'm alone my house, except 3 semi tame 3 cats, which also eats farang food

lucky you! here's my last electricity bill

 

 

 

[gk10002000]

On 8/20/2016 at 8:18 AM, Craig krup said:

 

I've never, ever understood people allowing stockbrokers to buy and sell investments using your money. A colleague of mine lost £150,000 in 2007-8 when her portfolio - picked by a regional stockbrokers and stuffed full of bank shares - went pop. If stockbrokers could outperform the market they'd be sitting in a Mayfair office earning a hundred times what they are earning. "Allow us to play with your money, because we know more than the world and you'll be able to keep the gains". Yeah. You'll over-trade and clock up all you can in fees and soft commissions. 

 

This bloke has £350,000 (if he was a Brit). City of London investment trust yields just over 4%, as does Murray International. Invested in these two he'd get about £15,000 a year split in eight payments. This (at the moment) is 675,000 baht, or 56,000 baht a month. Share prices could collapse, the baht could soar against the pound, the sky could fall down....People don't like volatility. But aiming into an indefinite future (and in the absence of serious health problems) I'd be pretty confident that £15,000 a year in 2016 in investments that track the whole of the world would probably keep body and soul together in Thailand, and over a thirty year time frame I'd be pretty confident that the capital value would be preserved or grow. The biggest risk is not taking a risk. Sit in cash and run it down and you're definitely doomed. You need to have the cash sitting ready for a meltdown - which happens with monotonous regularity - and then you buy, and buy and buy and make huge losses day after day. Then you hold for ever and retire rich

 

All the clowns who told you to buy when the market was roaring ahead, and told you that you were a fool when you bought during the meltdown, they......well, they get to work for ever. 

agree 100%.  Constantly amazes me how people turn over their money just because they don't know or understand anything about finances.  But at the same time, they won't turn over a penny in other areas that they don't know anything about until they do some research.  If a broker or financial person asks to see your portfolio, or your monies, the first thing you should do is demand his!  They have it backwards.  If they are so good with money, let them prove that to you with references, performance history, net worth, income statements etc.  Just like when you go see a doctor, you want a good doctor.  When you give money to anybody that provides a service, you expect competence and performance, car repair guy, whatever

[sezze]

2 hours ago, Naam said:

lucky you! here's my last electricity bill

 

 

 

Wow , 4000kwh in 1 month , you alone are taking care of global warming . I hope you have a nice company , so that you actually do something usefull with the electric .

Thats 5.55kw every hour of every day .

Edited August 21, 2016 by sezze
typo

[Pdaz]

About time to insulate the roof, swap to LED bulbs and buy inverter A/C's Naam ? 

[Ronuk]

9 hours ago, Scotwight said:

 

35sqm and on the ground floor. My walk in wardrobes are bigger. Then, to really put the icing on the cake....it's under Thai quota and in a company name. Go figure why he can't sell it.

Edited August 21, 2016 by Ronuk

[zeichen]

16 million at even a 2.5% interest which isn't unreasonable to get from some savings accounts, would net you 40k baht a month which is a reasonable amount to live on without touching the principal.

 

So yes, 16 million is doable for anyone at age 50 or 60 to retire here on.  Having a passive income or a pension on top of that would be even better because things happen and no monthly budget is ever close to what one spends a year. If someone says they spend a certain amount every month, they often exclude yearly expenses like visas, travel, accidents, hospital bills, etc. 

[Scotwight]

5 minutes ago, zeichen said:

16 million at even a 2.5% interest which isn't unreasonable to get from some savings accounts, would net you 40k baht a month which is a reasonable amount to live on without touching the principal.

 

So yes, 16 million is doable for anyone at age 50 or 60 to retire here on.  Having a passive income or a pension on top of that would be even better because things happen and no monthly budget is ever close to what one spends a year. If someone says they spend a certain amount every month, they often exclude yearly expenses like visas, travel, accidents, hospital bills, etc. 

This is Thailand.  What savings account pays 2.5%.  

[zeichen]

First of all, why does it have to be a Thai bank account?  He could easily invest it abroad earning up to 5%.  He could also invest in rental properties and generate between 3 and 5% ROI, even more if the property increases in value.

 

Second,  I have 3 bank accounts here that pay 3% or more in interest.

 

My wife has one account where she deposits 5k baht a month and gets 4.4% interest. 

[JAFO]

Man....that was a lot of read, same old stuff. Skimmed most of it. What still amazes me after all these years that when someone posts a "Live on this XXX amount" thread it ends in a debate with the high expectation westerners saying they could never live like that and how much they spend monthly and the pensioners disputing it tooth and nail saying they can live on way less. Both are right. they do what they want. Bottom-line, people are here and living at various levels of financial means just like they did in their home country. 16mil baht for some is a lot of money and Yes he could probably live a good life here if strategically managed. But none of us know the guy. Hard to say.

 

 

[up-country_sinclair]

Quote

Bottom-line, people are here and living at various levels of financial means just like they did in their home country. 16mil baht for some is a lot of money and Yes he could probably live a good life here if strategically managed. But none of us know the guy. Hard to say.

 

True.  It all falls on him and whether or not he is a reasonable and responsible individual.  Because if he's not, that 16 million can disappear quicker than he probably thinks.

Edited August 22, 2016 by up-country_sinclair

[Oxx]

2 hours ago, zeichen said:

First of all, why does it have to be a Thai bank account?  He could easily invest it abroad earning up to 5%.  He could also invest in rental properties and generate between 3 and 5% ROI, even more if the property increases in value.

 

Second,  I have 3 bank accounts here that pay 3% or more in interest.

 

My wife has one account where she deposits 5k baht a month and gets 4.4% interest. 

 

It would have to be a Thai bank account to avoid foreign exchange risk.  No point in getting 5% interest when the value of the cash falls by 20% or more as the exchange rate shifts.

 

Rental properties only generate income if they have people renting them.  Insecure.

 

Love to know more about the 4.4% account.  I very much doubt she really is getting 4.4% interest.  Which bank? Account type?

[4MyEgo]

On 18/08/2016 at 2:27 AM, TallGuyJohninBKK said:

I think the answers above reflect the reality of the situation faced by the OP's friend:

 

Although 16 million baht sounds like a lot, it's not really so much if that's ALL a person expects to have for his financial resources in the many years ahead. With that as his only financial resources, I'd say the chances of success would be borderline, depending on 1) how frugal or extravagant a lifestyle the friend intends to live, and 2] how long he will end up living.

 

I know I can live here in BKK on roughly $2,000 U.S. per month -- renting a very affordably priced apartment in a good area (lucky for me), married with a working, frugal wife, no kids, live a comfortable lifestyle, but we don't spend a lot on expensive capital purchases because we have the basic things we want and need. (Making bad choices and getting involved with the wrong Thai woman could easily see his savings quickly and substantially depleted).

 

But, I'm not planning my financial future on a budget of ONLY $2,000 U.S. per month, because prices will rise, health insurance will get more expensive, life may throw unexpected curves, etc etc.  So in my case, beyond the basic amount we spend right now, I have for the future added amounts both from private retirement funds (which continue to grow and I haven't tapped yet) and U.S. Social Security (which I'm still a few years away from being eligible for).

 

So, I could live on the expectation of spending $2,000 U.S. per month for the time being. But I wouldn't want to plan my financial future on the expectation that I'd HAVE to live on no more than $2,000 U.S. per month for the rest of my life. And unfortunately for the OP's friend, it sounds like the 16 million is his ONLY financial resource, period.

 

16 million baht = $470,000 U.S. -- over 20 years = $23,500 per year, or roughly $2,000 per month.  Of course, that's not considering any earning potential from the original funds, the results of which would depend on the OP's friend's success or lack thereof in investing.

 

 

On 18/08/2016 at 2:27 AM, TallGuyJohninBKK said:

 

 

 

[4MyEgo]

40,000 baht is what I budget on, however I live in a village, , have a house (my wife's), just thought I would correct myself before anyone else does that for me, and a car, (only invest as much as your prepared lose, and feed the wife and 4 kids and sometimes her family who are always doing it hard, but just food. 

 

The 40,000 baht covers the running costs of the car, electricity, mobile phone recharges, internet and the 300 baht I generously give to my wife to feed the family daily, on top of what I spend at Lotus weekly.

 

It does however exclude health insurance, school fees and holidays.

 

If he drew down up to 4% on his savings per year on top of the money he earned from a fixed savings account, say 40,000 baht per month as you mention, his savings could last him for 25 years based on a  maximum of 4% draw down annually, that's an extra 53,000 baht per month on top of the 40,000 baht per month from the savings which equates to 93,000 baht per month, very doable, but I believe this figure would have to be adjusted because he hasn't landed here yet and will have set up costs, e.g. if buying a place, a car etc etc this will reduce his saving, as will furniture and electrical goods, however its is still doable as long as he is conservative in his approach for retirement.

 

But without a partner and children, e.g. responsibility, I cannot see him being conservative, as he has probably been here a couple of times and has seen the circus like a "big kid", wanting to stay and eat a lot of fairy floss and those red apples on the sticks, if my assumption is correct, which I hope is not the case, the circus will eventually take him for that wrong ride, as many have been taken by before.

 

Another 5 years working as others have stated, with him travelling to and from Thailand for some monthly periods while he saves, investigates, and weighs things up will eventually get him here in the not too distant future, but coming in blind is not the way to go IMO.

 

Good luck to him either way, as he will need more than luck, I call it planning.  

[chiang mai]

7 minutes ago, 4MyEgo said:

40,000 baht is what I budget on, however I live in a village, , have a house (my wife's), just thought I would correct myself before anyone else does that for me, and a car, (only invest as much as your prepared lose, and feed the wife and 4 kids and sometimes her family who are always doing it hard, but just food. 

 

The 40,000 baht covers the running costs of the car, electricity, mobile phone recharges, internet and the 300 baht I generously give to my wife to feed the family daily, on top of what I spend at Lotus weekly.

 

It does however exclude health insurance, school fees and holidays.

 

If he drew down up to 4% on his savings per year on top of the money he earned from a fixed savings account, say 40,000 baht per month as you mention, his savings could last him for 25 years based on a  maximum of 4% draw down annually, that's an extra 53,000 baht per month on top of the 40,000 baht per month from the savings which equates to 93,000 baht per month, very doable, but I believe this figure would have to be adjusted because he hasn't landed here yet and will have set up costs, e.g. if buying a place, a car etc etc this will reduce his saving, as will furniture and electrical goods, however its is still doable as long as he is conservative in his approach for retirement.

 

But without a partner and children, e.g. responsibility, I cannot see him being conservative, as he has probably been here a couple of times and has seen the circus like a "big kid", wanting to stay and eat a lot of fairy floss and those red apples on the sticks, if my assumption is correct, which I hope is not the case, the circus will eventually take him for that wrong ride, as many have been taken by before.

 

Another 5 years working as others have stated, with him travelling to and from Thailand for some monthly periods while he saves, investigates, and weighs things up will eventually get him here in the not too distant future, but coming in blind is not the way to go IMO.

 

Good luck to him either way, as he will need more than luck, I call it planning.  

 

I like the approach but it needs tweaking:

 

He'd need to find an interest rate of 3% in order to get 40k a month, best on offer at present is about 1.8%. AND..

 

As he draws down at 4% per year his principle reduces and his monthly interest reduces accordingly because there's less invested each month.

[madmitch]

On 15 August 2016 at 11:22 AM, MikeyIdea said:

I have my investments with Broadgate Advisory Group, part of deVere Group. British of course, very professional, office in Exchange Tower Sukhumvit

 

Far from 16 million though

 

Investments should be left to professionals, it's bad times out there now but still, average returns over a 10 year period should be 5%. Better than 7-8% and ouppps, half gone

So-called investment professionals in Thailand have cost a lot of people a lot of money, including me. Avoid them like the plague!

[Stevemercer]

If you don't need a lot of sex (multiple partners), booze, partying or don't need a big city, 20,000 Baht per month might be sufficient. You could live on much less if you want to be a monk for the rest of your life.

 

If you are a single man and have come to Thailand for the women then 40,000 Baht is a bare minimum. Even then you would need to be pretty disciplined to stick to this budget for any length of time.

 

You could take the Thai approach and live every day like it is your last (live for the moment). 16 million baht might last a year or two, but you would have a blast. 

Edited August 22, 2016 by Stevemercer
update

[Peterw42]

6 minutes ago, madmitch said:

So-called investment professionals in Thailand have cost a lot of people a lot of money, including me. Avoid them like the plague!

 

Its the same all over the world, if these people are so good at making money why do they need mine

[mcfish]

Your friend needs to take the worst scenario and base all calcs on living to at least 90. It does happen

[4MyEgo]

16 minutes ago, chiang mai said:

 

I like the approach but it needs tweaking:

 

He'd need to find an interest rate of 3% in order to get 40k a month, best on offer at present is about 1.8%. AND..

 

As he draws down at 4% per year his principle reduces and his monthly interest reduces accordingly because there's less invested each month.

 

Agreed, what I do is split it into 2 groups, one is earning me 2.6% in fixed term account abroad, 2nd is bank shares, it doesn't bother me that banks shares are down about $5 a share since when I 1st purchased them, they are providing me 5.6% return fully franked, which is more than double to what I am getting from the fixed term deposits in the bank, and I have a years cash in an at call account in case of emergencies. I only invest in the biggest bank in my country, because if it goes down, so does the country, and like I said, I am not at all fussed if the shares in the bank drop, its the return I look for as I have reserves, and stocks do pick up.

[Red13]

I would imagine a savings pot, property and a pension of some sort would be assisting this person through his later years in addition to his new found windfall.

 

If not, 16M baht is 50000 baht a month over 25 years without even taking into account investment opportunities or interest accrued.

 

If you cannot live a comfortable life as a retiree in Thailand on 50000 baht  a month you need to have a word with yourself.

 

In context that is £1000 GBP per month. UK minimum wage, or twice the UK state pension.

 

 

[Oxx]

1 minute ago, Red13 said:

If not, 16M baht is 50000 baht a month over 25 years without even taking into account investment opportunities or interest accrued.

 

You're forgetting the effect of inflation.  Assuming 3% inflation (and that's conservative), the 50,000 baht will be worth around half after 25 years.

 

And as one ages, one's expenses can rise (medical costs, care home or full time carer).