What is Retirement ?

Extract:-

Ask 10 people what it means to be rich, and you'll get 10 very different answers.
Some will say that rich means no worry, although of course rich people worry all the time. Once you have a certain amount of money, you naturally worry about losing it, for instance.
Some will say that rich means being self-sufficient. Which sounds great, but there are self-sufficient people who earn much less than the average person. And there are high earners who are dependent on that next bonus check to keep their head above water.
Still others will paint their wealth in terms of free time, personal fulfillment or the capacity to give back. Charity is a calling, even a full-time job for some.
Let's set aside "rich" for the moment and consider the responses so far. It begins to sound like rich really means "freedom." Freedom from worry, freedom from troubles, freedom to make choices and live according to one's own design.
Perhaps the better way to phrase the question then is, what does it mean to achieve personal freedom?
One measure is the ability to come and go as you please and to work, if you find work rewarding. Being debt-free is important. Personal development is a plus for many. That might be the same as pursuing a hobby or a pastime, but not necessarily.
Now the killer question: Do you need to wait until retirement to do any of this?
The truth is, not really. Just like employment is a means to an end (income today), saving and investing is a means to an end as well, and it is the same: income, but without the necessity of employment.
Building a lifetime of worry-free income, then, is the real goal of retirement saving, not "being rich" or "quitting work." After all, more than a few retirees have quit for six months and then found themselves so bored that they return to work anyway.
For them, work was fulfillment. It can be hard to redefine your life in a few months. Impossible even. There are social connections and validation at the workplace that are hard to replicate elsewhere.
Your exercise for the next few weeks, if you choose to accept it, is to take an honest inventory of your life with three questions. These are important. It could result in you redefining your idea of retirement.

1) What do I want to do every day, if not show up at a job? Or is a job what I need?
2) How much income do I need to have the freedom to choose between working or not working, realistically?
3) How much money do I need to generate that level of income indefinitely?

Some people will never be able to answer the first question. Often, it takes a change in life to force us out of a personal rut.
The second answer isn't that hard to come by. You know what you earn now and how much you spend. Retirement may precipitate a move to a cheaper city or state, of course, but once you leave a career behind, geography is less of a constraint.
As for the income part, that's easy: Build an income-oriented portfolio with a dash of growth assets to protect against inflation.
Once, that kind of investment advice was costly and full of hard decisions. The trend toward low-cost exchange-traded funds and asset allocation plans has brought once-sophisticated strategies down to ordinary investors, and at a fraction of the price.
The best part is, your investments can be as simple and worry-free as your life. All it takes is a little bit of thought.

Temperament - i know we always argue on this forum but this extract of yours contains great wisdom.

I find a lot of people dont want to ask themselves the hard questions or even give themselves honest answers so it is like starting a long journey but refusing to learn how to read a map, or even where north/south/east/west is.

(17-02-2013, 11:33 PM)Temperament Wrote: 1) What do I want to do every day, if not show up at a job? Or is a job what I need?

I had read up some articles regarding "Preparing for Retirement". In those articles, the writers advocate while still in a job, slowly transiting towards what a person want to do during retirement, be is a hobby, or charity work. In doing so, retirement will not be with "nothing to do", which may leads to many old age issues.

I am almost fifty and gave up my job more 6 month ago due to erratic company policy. It is almost impossible for me to get back the same type of job consider my present age and also thanks to our government FT policy. Companies are spoiled with choice of unlimited cheap PMET. I find that employers nowadays do not value experienced staff much compared with those years before the floodgate was opened. They instead prefer younger and cheaper executives. I keep wondering why we are hearing employers complaining difficulties in filling up job vacancies in our mainstream media.

After hanging loose for a few month, I took an account of the returns from my stock investment and realised that they are actually more then sufficiently support my living expenses. So seeking re-employment is not a top priority in my mind now.

Another thing I did after being jobless was to sell away my car. Not because I could no longer able to support, but it was just no longer a necessity anymore. In fact it was grossly underutilized. The year mileage was below 10km. The car was fully paid for in cash as I am always "allergied" to taking up loan for luxury items. I invested all the money from the sale of the car in stock which in turn increase my passive income.

Imagine the difference: Whether you use it or not, a car burn more than $10k hole in my pocket every year but money from the car sale fatten my pocket about $4k every year on average!

Even though I don't have to struggling working for money, I am not considering myself rich just yet. I still have a school going child to support. He still in primary school but my wife an I have put aside some money to take care of his uni fees 10 years from now. In the mean time, I try to enjoy life to the fullest without over burning my pocket.

One thing I would like to share is that: We need some money to enjoy life. But it's not as much as we would always think. My living and investing principle is the same: Keep it simple!

That's a very good move!

U wasted no time adjusting to the 'new' life.

I hope your family members, esp. yr spouse supports the change.
Besides fixed expenses like housing loan & insurance , car expense is the next biggest expense which I think we can do without in Sg.
But of course if we can afford to own a car, it is considered a 'luxury'.

(19-02-2013, 11:01 AM)zhangwuji Wrote: I am almost fifty and gave up my job more 6 month ago due to erratic company policy. It is almost impossible for me to get back the same type of job consider my present age and also thanks to our government FT policy. Companies are spoiled with choice of unlimited cheap PMET. I find that employers nowadays do not value experienced staff much compared with those years before the floodgate was opened. They instead prefer younger and cheaper executives. I keep wondering why we are hearing employers complaining difficulties in filling up job vacancies in our mainstream media.

After hanging loose for a few month, I took an account of the returns from my stock investment and realised that they are actually more then sufficiently support my living expenses. So seeking re-employment is not a top priority in my mind now.

Another thing I did after being jobless was to sell away my car. Not because I could no longer able to support, but it was just no longer a necessity anymore. In fact it was grossly underutilized. The year mileage was below 10km. The car was fully paid for in cash as I am always "allergied" to taking up loan for luxury items. I invested all the money from the sale of the car in stock which in turn increase my passive income.

Imagine the difference: Whether you use it or not, a car burn more than $10k hole in my pocket every year but money from the car sale fatten my pocket about $4k every year on average!

Even though I don't have to struggling working for money, I am not considering myself rich just yet. I still have a school going child to support. He still in primary school but my wife an I have put aside some money to take care of his uni fees 10 years from now. In the mean time, I try to enjoy life to the fullest without over burning my pocket.

One thing I would like to share is that: We need some money to enjoy life. But it's not as much as we would always think. My living and investing principle is the same: Keep it simple!

(19-02-2013, 11:01 AM)zhangwuji Wrote: I am almost fifty and gave up my job more 6 month ago due to erratic company policy. It is almost impossible for me to get back the same type of job consider my present age and also thanks to our government FT policy. Companies are spoiled with choice of unlimited cheap PMET. I find that employers nowadays do not value experienced staff much compared with those years before the floodgate was opened. They instead prefer younger and cheaper executives. I keep wondering why we are hearing employers complaining difficulties in filling up job vacancies in our mainstream media.

After hanging loose for a few month, I took an account of the returns from my stock investment and realised that they are actually more then sufficiently support my living expenses. So seeking re-employment is not a top priority in my mind now.

Another thing I did after being jobless was to sell away my car. Not because I could no longer able to support, but it was just no longer a necessity anymore. In fact it was grossly underutilized. The year mileage was below 10km. The car was fully paid for in cash as I am always "allergied" to taking up loan for luxury items. I invested all the money from the sale of the car in stock which in turn increase my passive income.

Imagine the difference: Whether you use it or not, a car burn more than $10k hole in my pocket every year but money from the car sale fatten my pocket about $4k every year on average!

Even though I don't have to struggling working for money, I am not considering myself rich just yet. I still have a school going child to support. He still in primary school but my wife an I have put aside some money to take care of his uni fees 10 years from now. In the mean time, I try to enjoy life to the fullest without over burning my pocket.

One thing I would like to share is that: We need some money to enjoy life. But it's not as much as we would always think. My living and investing principle is the same: Keep it simple!

Wish you all the best for the new life, which i believe is a feasible route if done right. KopiKat is one of the successful one in this forum.

I agree with you that it is much lower $ needed to enjoy life than we always thought.

(17-02-2013, 11:33 PM)Temperament Wrote: Extract:-

Ask 10 people what it means to be rich, and you'll get 10 very different answers.
Some will say that rich means no worry, although of course rich people worry all the time. Once you have a certain amount of money, you naturally worry about losing it, for instance.
Some will say that rich means being self-sufficient. Which sounds great, but there are self-sufficient people who earn much less than the average person. And there are high earners who are dependent on that next bonus check to keep their head above water.
Still others will paint their wealth in terms of free time, personal fulfillment or the capacity to give back. Charity is a calling, even a full-time job for some.
Let's set aside "rich" for the moment and consider the responses so far. It begins to sound like rich really means "freedom." Freedom from worry, freedom from troubles, freedom to make choices and live according to one's own design.
Perhaps the better way to phrase the question then is, what does it mean to achieve personal freedom?
One measure is the ability to come and go as you please and to work, if you find work rewarding. Being debt-free is important. Personal development is a plus for many. That might be the same as pursuing a hobby or a pastime, but not necessarily.
Now the killer question: Do you need to wait until retirement to do any of this?
The truth is, not really. Just like employment is a means to an end (income today), saving and investing is a means to an end as well, and it is the same: income, but without the necessity of employment.
Building a lifetime of worry-free income, then, is the real goal of retirement saving, not "being rich" or "quitting work." After all, more than a few retirees have quit for six months and then found themselves so bored that they return to work anyway.
For them, work was fulfillment. It can be hard to redefine your life in a few months. Impossible even. There are social connections and validation at the workplace that are hard to replicate elsewhere.
Your exercise for the next few weeks, if you choose to accept it, is to take an honest inventory of your life with three questions. These are important. It could result in you redefining your idea of retirement.

1) What do I want to do every day, if not show up at a job? Or is a job what I need?
2) How much income do I need to have the freedom to choose between working or not working, realistically?
3) How much money do I need to generate that level of income indefinitely?

Some people will never be able to answer the first question. Often, it takes a change in life to force us out of a personal rut.
The second answer isn't that hard to come by. You know what you earn now and how much you spend. Retirement may precipitate a move to a cheaper city or state, of course, but once you leave a career behind, geography is less of a constraint.
As for the income part, that's easy: Build an income-oriented portfolio with a dash of growth assets to protect against inflation.
Once, that kind of investment advice was costly and full of hard decisions. The trend toward low-cost exchange-traded funds and asset allocation plans has brought once-sophisticated strategies down to ordinary investors, and at a fraction of the price.
The best part is, your investments can be as simple and worry-free as your life. All it takes is a little bit of thought.

Thanks for sharing Temperament. It is indeed enlightening.

Just a point to add. I feel the word should be "enough" instead of being "rich". Then again, what is enough is different for different people.

(19-02-2013, 11:17 AM)etan Wrote: car expense is the next biggest expense which I think we can do without in Sg.

I considered selling away my car recently but notice SARs and birdie flu seems to have strike other countries. I am not optimistic that Spore will not be hit given our open door policy.

(19-02-2013, 11:17 AM)etan Wrote: That's a very good move!

U wasted no time adjusting to the 'new' life.

I hope your family members, esp. yr spouse supports the change.
Besides fixed expenses like housing loan & insurance , car expense is the next biggest expense which I think we can do without in Sg.
But of course if we can afford to own a car, it is considered a 'luxury'.

(19-02-2013, 11:01 AM)zhangwuji Wrote: I am almost fifty and gave up my job more 6 month ago due to erratic company policy. It is almost impossible for me to get back the same type of job consider my present age and also thanks to our government FT policy. Companies are spoiled with choice of unlimited cheap PMET. I find that employers nowadays do not value experienced staff much compared with those years before the floodgate was opened. They instead prefer younger and cheaper executives. I keep wondering why we are hearing employers complaining difficulties in filling up job vacancies in our mainstream media.

After hanging loose for a few month, I took an account of the returns from my stock investment and realised that they are actually more then sufficiently support my living expenses. So seeking re-employment is not a top priority in my mind now.

Another thing I did after being jobless was to sell away my car. Not because I could no longer able to support, but it was just no longer a necessity anymore. In fact it was grossly underutilized. The year mileage was below 10km. The car was fully paid for in cash as I am always "allergied" to taking up loan for luxury items. I invested all the money from the sale of the car in stock which in turn increase my passive income.

Imagine the difference: Whether you use it or not, a car burn more than $10k hole in my pocket every year but money from the car sale fatten my pocket about $4k every year on average!

Even though I don't have to struggling working for money, I am not considering myself rich just yet. I still have a school going child to support. He still in primary school but my wife an I have put aside some money to take care of his uni fees 10 years from now. In the mean time, I try to enjoy life to the fullest without over burning my pocket.

One thing I would like to share is that: We need some money to enjoy life. But it's not as much as we would always think. My living and investing principle is the same: Keep it simple!

Etan, thank you for your comment. I consider myself lucky that I never need to take up any HDB loan. I married in my mid thirties and chose to live with my parents after that. By the time when we need to get our own flat, we already had more than enough money in our CPF to fully financed a 5rm flat. "Rich Dad Poor Dad" made realized that HDB loan is one of the biggest stumbling block against our retirement plan. I hope those young couples planning to settle down soon to consider all other option thoroughly before taking up any loan. You want to be slaved to the bank for 20 -30 years? Note: I hold some bank shares

---

(19-02-2013, 12:17 PM)Bibi Wrote:

(19-02-2013, 11:17 AM)etan Wrote: car expense is the next biggest expense which I think we can do without in Sg.

I considered selling away my car recently but notice SARs and birdie flu seems to have strike other countries. I am not optimistic that Spore will not be hit given our open door policy.

Hi Bibi,
Don't me saying: That is an excuse. Though not a good one.

Having said that, well, if you have and don't mind burning more than $10k yearly, that's okay. For me, I choose to make my $$$ work for me instead.

(19-02-2013, 12:21 PM)zhangwuji Wrote:

(19-02-2013, 11:17 AM)etan Wrote: That's a very good move!

U wasted no time adjusting to the 'new' life.

I hope your family members, esp. yr spouse supports the change.
Besides fixed expenses like housing loan & insurance , car expense is the next biggest expense which I think we can do without in Sg.
But of course if we can afford to own a car, it is considered a 'luxury'.

(19-02-2013, 11:01 AM)zhangwuji Wrote: I am almost fifty and gave up my job more 6 month ago due to erratic company policy. It is almost impossible for me to get back the same type of job consider my present age and also thanks to our government FT policy. Companies are spoiled with choice of unlimited cheap PMET. I find that employers nowadays do not value experienced staff much compared with those years before the floodgate was opened. They instead prefer younger and cheaper executives. I keep wondering why we are hearing employers complaining difficulties in filling up job vacancies in our mainstream media.

After hanging loose for a few month, I took an account of the returns from my stock investment and realised that they are actually more then sufficiently support my living expenses. So seeking re-employment is not a top priority in my mind now.

Another thing I did after being jobless was to sell away my car. Not because I could no longer able to support, but it was just no longer a necessity anymore. In fact it was grossly underutilized. The year mileage was below 10km. The car was fully paid for in cash as I am always "allergied" to taking up loan for luxury items. I invested all the money from the sale of the car in stock which in turn increase my passive income.

Imagine the difference: Whether you use it or not, a car burn more than $10k hole in my pocket every year but money from the car sale fatten my pocket about $4k every year on average!

Even though I don't have to struggling working for money, I am not considering myself rich just yet. I still have a school going child to support. He still in primary school but my wife an I have put aside some money to take care of his uni fees 10 years from now. In the mean time, I try to enjoy life to the fullest without over burning my pocket.

One thing I would like to share is that: We need some money to enjoy life. But it's not as much as we would always think. My living and investing principle is the same: Keep it simple!

Etan, thank you for your comment. I consider myself lucky that I never need to take up any HDB loan. I married in my mid thirties and chose to live with my parents after that. By the time when we need to get our own flat, we already had more than enough money in our CPF to fully financed a 5rm flat. "Rich Dad Poor Dad" made realized that HDB loan is one of the biggest stumbling block against our retirement plan. I hope those young couples planning to settle down soon to consider all other option thoroughly before taking up any loan. You want to be slaved to the bank for 20 -30 years? Note: I hold some bank shares

---

(19-02-2013, 12:17 PM)Bibi Wrote:

(19-02-2013, 11:17 AM)etan Wrote: car expense is the next biggest expense which I think we can do without in Sg.

I considered selling away my car recently but notice SARs and birdie flu seems to have strike other countries. I am not optimistic that Spore will not be hit given our open door policy.

Hi Bibi,
Don't me saying: That is an excuse. Though not a good one.

Having said that, well, if you have and don't mind burning more than $10k yearly, that's okay. For me, I choose to make my $$$ work for me instead.

Yes, the car is a luxury for most people in Singapore. It is underutilised if you don't rat race and eat at home most of the time. But many people like me just so used to the luxury of owning car for for 6,7 or 8 years already (installment free) that we know once we sell our cars, most probably for the rest of our lifetime we will not buy another car. (Not that i can't afford to buy but because it just doesn't make sense to me except for the PAPY & Elites.)

Come 2015 or 2016, many more cars will reach their 10 years COE . So i shudder at the thought of how many more people going to make the sardine-packed transport system worst. But maybe, retirees like us should be smart enough or having the luxury to choose the off-peak travel time if nothing urgent.
But i have a phobia of the SMRT breaking down anytime, anywhere. i pray i won't be one of the victim caught by the SMRT breaking down in the tunnel. Especially in the Tunnel, SMRT tends to break down because it is where defects or malfunctions of tracks/equipments can not be seen or detected easily. So i think i will take the bus if it can take me to almost the same place.
6.9 million population, Ha! Ha! ????