I think the most common question asked is “How much longer to your retirement?” or “At what age do you plan to retire?” But, with the advance in technology and the financial climate changing, the more apt question would be “How much do you need to retire?”
Famous and smart celebrities have the privilege of saying “The question here is not at what age I wish to retire but its at what income I want to retire”. If this ring true for you, you’re blessed.
In fact, it is no fun to retire at your retirement age; be it 55, 60, 65 or even 70. Think about it, how much fun you are going to miss by the time you wait for your retirement age to retire, let say at 60 on the average. If you are young now you probably would not be able to imagine what its like to be 60. Go look around and take a person at that age now and find out how his/her physical, mental and health abilities are.
Majority of us would take our retirement age for granted. We accept that we will retire when it comes the time that we need to retire. Or that we will retire when we are not employable. But, the question here is “Is this how you want to live your life?” Are we allowing an “accepted fact” to rule our lives?
Let’s change our thought patterns, let’s think out of the box a bit for now. Let’s say you live a simple life and that you will survive comfortably on a constant income of $5,000 per month without having to work. How can you plan towards that kind of residual income?
Of course with that kind of income you can only take care of your daily expenses and maybe can afford to save up for an annual holiday. You will have to have your medical insurance intact, just in case you get sick and the better bet is to keep yourself healthy by eating right and exercising regularly.
You will need a $1.2 million to put in a bank earning you a 5% interest to have a monthly $5,000 earning. You got your answer. But it’s not that simple. You will need a lot of planning financially in order to achieve that goal.
Seek a financial planner’s assistance or if you are savvy with money management and have your own financial education, read some of the posts here and seek out what can work best for you.
Happy working towards your retirement!!!