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PMT Forum's MOST POPULAR Discussion Boards => General Questions and Discussions about Money => Financial Planning Help and Tips => Topic started by: kimerran on Oct 29, 2011, 08:22 AM

Title: Retirement Calculator
Post by: kimerran on Oct 29, 2011, 08:22 AM
If you are investing for some time now and have no idea how much you would accumulate on your target year, here is the Retirement Calculator (http://www.peratbp.com/2011/10/retirement-calculator.html) from Truly Rich Club that you can use to calculate it.

(http://1.bp.blogspot.com/-UT7TSZgWnVg/Tqs_TMwLWxI/AAAAAAAAASA/g03fXWuE_x4/s320/CALCULATOR.JPG)

Title: Re: Retirement Calculator
Post by: lifeinsurance on Oct 30, 2011, 11:57 AM
A calculator is good, but you have to know your goal first. You can save every month only to find out too late upon retirement that what you've saved isn't enough. I suggest you read this article How Much Money Do You Need For Retirement (http://www.lifeinsuranceph.com/how-much-money-do-you-need-for-retirement/)
Title: Re: Retirement Calculator
Post by: DonT on Oct 30, 2011, 12:25 PM
^ read your blog...and inflation rate of 5% seems to be too high.
A person now in their 30s should have 22M by that time he or she retires at 60....thats seems to be tough.
Title: Re: Retirement Calculator
Post by: lifeinsurance on Oct 30, 2011, 09:01 PM
^ read your blog...and inflation rate of 5% seems to be too high.
A person now in their 30s should have 22M by that time he or she retires at 60....thats seems to be tough.

Inflation at 5% is actually quite conservative. The average for the past five years has been 4.8%. See another post entitled Inflation Rates in the Philippines and How Inflation Affects You (http://www.lifeinsuranceph.com/inflation-rates-in-the-philippines-and-how-inflation-affects-you/). The average inflation rate on consumer prices in a 10-year span from 1990 to 1999, was 9.94%. In the first five years of that same decade the average inflation rate was 11.46%. We don't know if it will remain at 4.8% or go lower (hopefully), but we'll use a realistic inflation rate for projections.

As for 22M, yes it is tough, but that is exactly what is needed. Imagine it this way. Let's assume you spend P30,000 a month in 2011. In order to maintain your current lifestyle, that means you will be spending P96,753 per month in 2035 (P96,753 is the Future Value of today's P30,000 in 24 years at 5% inflation rate). Since you are retired, and have no more work, you will be consuming your retirement fund at the rate of at least P96,753 per month in 2035 and onward.

If you do not have P22M and are already retired and you want to maintain your current lifestyle, then you must have PASSIVE INCOME that will give you P96,753 a month in 2035.

Just to give you an idea, a P5M condo today could be rented out for P30T per month. Applying inflation rate, you must have properties worth P16.125M in 2035 in order to give you a passive income of P96,753 a month. But since your source of income is purely from rent, occupancy rates can affect your income. You must have additional properties to rely on. You'll end up having around P20M worth of property to guarantee you a cash flow of P96,753 a month.

Another note: P22M in 2035 is worth P6.8M in 2011. If you have P6.8M today and invest it in a fund that earns 5% per year, then you will have P22M by 2035.

If you don't have such a big amount today, what do you do? Start saving up while developing other sources of income as well.
Title: Re: Retirement Calculator
Post by: darkweapon on Jan 06, 2012, 08:46 AM
Plan early for your retirement.... check out  the power of compounding interest....  (http://pinoywealthcrusaders.blogspot.com/2011/12/sdfg.html)

Hope this helps....  :watchuthink:
Title: Re: Retirement Calculator
Post by: Manoth on Aug 15, 2012, 04:10 PM
Hi. I'd still recommend any retirement calculator that applies figures against hundreds of situations. On the other hand, you logically need to know how much income you'll need to live the life you want when you retire. So before you can use the calculator offered by kimerran or any other, you must first understand what your retirement needs will be.
Title: Re: Retirement Calculator
Post by: prnd32 on Aug 15, 2012, 05:31 PM
DO NOT RETIRE!  Yet, invest/save for the future.  Make sure to continue working after 60 or 65 (the so called retirement age).  This will keep you financially and physically healthy.

Pahabol:  DO NOT THINK RETIRING EITHER!
Title: Re: Retirement Calculator
Post by: pmtmember on Aug 15, 2012, 07:01 PM
i am using the android app of Prulife UK. maganda
Title: Re: Retirement Calculator
Post by: eboy on Aug 17, 2012, 09:23 AM
A calculator is good, but you have to know your goal first. You can save every month only to find out too late upon retirement that what you've saved isn't enough. I suggest you read this article How Much Money Do You Need For Retirement (http://www.lifeinsuranceph.com/how-much-money-do-you-need-for-retirement/)

The site is misleading.  You would need P22 million if you are taking that money and stuffing it under your mattress.  Remember, even retired your money will still grow.  If it grows at the same rate of inflation (5%) you will only need ~15 million.
Title: Re: Retirement Calculator
Post by: bajoyjoy on Aug 17, 2012, 09:39 AM
that's why you have to find an investment where your money will outpace inflation rate.
i am using the android app of Prulife UK. maganda
why, maganda? care to share anong meron? :)