Why Holland or Switzerland? taxes, or assisted suicide?
Key Post How much savings do you need to feel safe
- Thread starter buzybee
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Why Holland or Switzerland? taxes, or assisted suicide?
The latter, but by that time it may be a bit more widespread.
Haha! I would make sure to spend the last 50k first!
Interesting thread.
On a back of an envelope basis, I would estimate that a couple retiring at 65 would need to have accumulated retirement savings/pension entitlements to a value of around €1.25 million (in 2015 terms), plus a mortgage free house, to comfortably meet Brendan's 4 suggested targets.
That's going to be a very big ask for the vast majority of people.
On a back of an envelope basis, I would estimate that a couple retiring at 65 would need to have accumulated retirement savings/pension entitlements to a value of around €1.25 million (in 2015 terms), plus a mortgage free house, to comfortably meet Brendan's 4 suggested targets.
That's going to be a very big ask for the vast majority of people.
Or half for a singleton which as long as the mortgage is paid for.
I have a feeling it's better to have loads of money or very little. If you have no money the state are going to look after you and you will get everything free. If you have 100k or 200k it's probably worthless as you potentially fail all means tests and you are actually in a worse off position.
At a certain age I'm going to take all my cash and leave it in a safety deposit box somewhere so I will get full benefits should I need them.
Most people I know around my age have no savings and probably pay most of there money to mortgage etc so doubt they will start saving up to anywhere near 1 million by 65. Even for me saving a huge figure monthly 1.25million seems out of reach.
Ive read a few early retirement website type blog things where people retire in there 30/40's with 600,000 - I wouldn't feel comfortable with that little . I've asked before on here would 1 million at 40 be enough and mostly people think no it wouldn't . Surprisingly there is little online to tell you how much you would actually need on average if you retired at any given age. 25 times yearly expenses I've seen quoted a bit that seems tight to me.
At a certain age I'm going to take all my cash and leave it in a safety deposit box somewhere so I will get full benefits should I need them.
Most people I know around my age have no savings and probably pay most of there money to mortgage etc so doubt they will start saving up to anywhere near 1 million by 65. Even for me saving a huge figure monthly 1.25million seems out of reach.
Ive read a few early retirement website type blog things where people retire in there 30/40's with 600,000 - I wouldn't feel comfortable with that little . I've asked before on here would 1 million at 40 be enough and mostly people think no it wouldn't . Surprisingly there is little online to tell you how much you would actually need on average if you retired at any given age. 25 times yearly expenses I've seen quoted a bit that seems tight to me.
Well, a couple would presumably have a lot of shared expenses (one electricity bill, one LPT bill, etc.) so I would have thought retirement savings/pension entitlements to a value of something like €900k could fund a similar lifestyle for a single person.
Very rough calculation, obviously, and implies all sorts of assumptions regarding individual circumstances.
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That ratio derives from a well known study published in 1998 in the US that examined the probability of various investment portfolios, with different asset allocations, surviving different withdrawal rates, adjusted for inflation, over various rolling time periods.
The study examined the historical performance of various asset classes in the US and did not take account of investment costs or taxes.
The 4% "safe" withdrawal rate (another way of describing the appropriateness of having a ratio of retirement savings equivalent to 25 times annual expenses) is very controversial and should be treated with extreme caution in an Irish context.
Here's a link to the study:
It is said that; “a wealthy man is someone who knows they have enough”
However, putting a number on how much money anyone really needs is difficult.
Defining how much ‘is enough’ is tough, because it will change over time depending on various factors such as our personal goals and values about money, our earnings, lifestyle expectations and state of health.
I’m a Financial Planner and most of what I do is ask people what’s important about money to THEM so that I can understand where they are trying to get to.
Proper Financial Planning will help anyone to answer this question.
However, putting a number on how much money anyone really needs is difficult.
Defining how much ‘is enough’ is tough, because it will change over time depending on various factors such as our personal goals and values about money, our earnings, lifestyle expectations and state of health.
I’m a Financial Planner and most of what I do is ask people what’s important about money to THEM so that I can understand where they are trying to get to.
Proper Financial Planning will help anyone to answer this question.
I've decided I'll need to have in the region of €1,000,000 (in todays terms) in pension savings by the time I'm 65. I'm putting extra into my pension now and using various calculators I should come close enough to that target at 65 (normal retirement age of my pension scheme). That will be beside any cash savings I have myself, which I'm hoping to have €100k + of by that time.. Fingers crossed. Do people feel that would be enough, especially seeing as I hope to be a happily married man (!) at that stage and will assume my wife will have a pension also!
Gordon Gekko
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So €340k in cash (your €100k plus your 25% lump sum of €240k) and an ARF/AMRF of €750k from which you'll have to take 4% per year?
That'll give you private pension income of around €27k, the State pension, and a significant cash buffer.
A pretty decent position, assuming that your ARF/AMRF can maintain its notional value by returning (say) 5% per annum on average.
Inflation and returns are the great unknowns, as is legislative change.
That'll give you private pension income of around €27k, the State pension, and a significant cash buffer.
A pretty decent position, assuming that your ARF/AMRF can maintain its notional value by returning (say) 5% per annum on average.
Inflation and returns are the great unknowns, as is legislative change.
[QUOTE="Sarenco, post: 1455070, member: 87373
The 4% "safe" withdrawal rate (another way of describing the appropriateness of having a ratio of retirement savings equivalent to 25 times annual expenses) is very controversial and should be treated with extreme caution in an Irish context.
Here's a link to the study:
[/QUOTE]
I remember seeing somewhere how this does not hold for other markets e. G. Japan (as sarenco says ) was down as less than 1 pc , think was Davy presentation ......
The 4% "safe" withdrawal rate (another way of describing the appropriateness of having a ratio of retirement savings equivalent to 25 times annual expenses) is very controversial and should be treated with extreme caution in an Irish context.
Here's a link to the study:
[/QUOTE]
I remember seeing somewhere how this does not hold for other markets e. G. Japan (as sarenco says ) was down as less than 1 pc , think was Davy presentation ......
How are people getting pensions worth a million by 65 ? And then the poster above is wondering if that be enough !! What am I missing here ?
For an average person that would require putting in 25000 a year for 40 years , OK you get tax relief but still that's a massive amount to save must be a great job , surely that's more than enough .
I think most people don't save anything and very few have even got a pension. If I have a million at 65 I'll be delighted and not holding back on my spending can't see it running out .
For an average person that would require putting in 25000 a year for 40 years , OK you get tax relief but still that's a massive amount to save must be a great job , surely that's more than enough .
I think most people don't save anything and very few have even got a pension. If I have a million at 65 I'll be delighted and not holding back on my spending can't see it running out .
Gordon Gekko
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You're ignoring investment growth...
I met womeone a while
I met someone a while ago and he told me he paid €9000 euro in AVC's in 2004, he cashed in his pension recently aged 62 and he didn't even get back his full €9000 something like €8500 and that was after investing it 11 years ago. He would have got more in a deposit account.
Some investment growth there
I met someone a while ago and he told me he paid €9000 euro in AVC's in 2004, he cashed in his pension recently aged 62 and he didn't even get back his full €9000 something like €8500 and that was after investing it 11 years ago. He would have got more in a deposit account.
Some investment growth there
You really cant predict the future, you just can't plan these things, who know you might meet a woman that will clean you out, be careful out there
...and public sector pensions {ducks for cover
}.The average Garda, for example, will retire with a pension with a fair market value of over €1.1million.
Take a public sector worker that retires at 55 with a pension of €50k per annum. A "retired" TD perhaps. That pension has a fair market value of €2.8million. No, that's not a typo.
Meanwhile back in the real world...
A €15k annual contribution to a pension over 35 years will get you to €1m, assuming a 3.5% compound annual growth rate, net of costs.
Do I think a real growth rate of 3.5%, net of costs, is likely on a typical balanced fund over the coming decades at current valuations?
No.
Possible certainly but not very likely.
Gordon Gekko
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I met womeone a while
I met someone a while ago and he told me he paid €9000 euro in AVC's in 2004, he cashed in his pension recently aged 62 and he didn't even get back his full €9000 something like €8500 and that was after investing it 11 years ago. He would have got more in a deposit account.
Some investment growth there
Clearly he/she was badly invested or hammered for fees.
The performance of a medium tisk managed fund over the period would have been stellar.
I started my pension young, at 24. Luckily for me, my pension has experienced some good growth over the past few years, even after taking a hammering in 2008. I'm now able to pay more toward my pension, thankfully. It might not go on forever though. I'm aiming for the million mark but it's more a fingers crossed situation!