Originally Posted by Unregistered (Post 74159)

How about something more middle-class?

For 2 pax

Restaurant/Cafe – $500 per month
Groceries – $700 per month (meals for 2 + daily necessities)
Telco, Utilities and Conservancy Fees – $200 per month (broad band, mobile, electricity, water, conservancy fees)
Healthcare and Medical – $400 per month (supplements, visits to GP, medicine, Chinese herbs, etc).
Transport - $200/month
Misc – $1300 per month (include random stuff like giving cny angbaos over the whole year and travelling)

Total/month: $3300 (2pax), $1650 (1pax)
30 years: $1.2m (2pax), $600k (1pax)

This lifestyle already very comfortable, at least for my standard. Can definitely go even lower. I bet some financial advisor gave the mentioned scenario for you-know-what reasons.

Originally Posted by Unregistered (Post 74156)

Projected Retirement Budget – Comfortable Scenario. Someone worked this out.

How much would a retiree truly need?
Let us imagine another hypothetical 54 year old, whom we call Mr Yeo, who hopes to retire next year when he hits 55. If he is fairly healthy, lives comfortably, drives, and has no outstanding home or vehicle loans, his projected living costs may look like this:

Car – $1,500 to $2,000 per month (for a modest Japanese sedan and includes vehicle loan payments, Road Tax, parking, ERP, fuel, insurance, repairs, and other costs). See Money Smart’s article here for the estimate.
Restaurant/Cafe – $600 per month (assuming 20 meals/drinks of about $30 each per month at restaurants, cafes, and bars)
Groceries – $300 per month (this is for all home-cooked meals)
Telco, Utilities and Conservancy Fees – $150 to $200 per month (broad band, mobile, electricity, water, conservancy fees)
Clothes and Accessories Shopping – $300 per month
Domestic Helper – $700 to $800 per month (includes levy and other living and sundry expenses like food, etc).
Healthcare and Medical – approx $80 to $100 per month (supplements, visits to GP, medicine, Chinese herbs, etc).
Personal Grooming – $50 to $100 per month (hair, facial, toiletries, creams etc)
Holiday Expenses – $500 per month (assuming $6,000 per year for one long haul trip of about $4,000, two short haul trips of about $1,000 each)
Gifts and Donations – $200 per month (assuming about $2,400 per year for Christmas/CNY/Hari Raya/Deepavali gifts, donations to charities, and offerings to religious institutions)
This works out to an estimated monthly budget of approximately $4,750 or so, excluding other miscellaneous expenses. If we assume that Mr Yeo lives till an average age of 85 years (Singapore’s life expectancy), the total amount needed could look like this:
Annual expenses (first year): $57,000
Expenses over 30 years: approx $1.71 million

Hang on a minute. We forgot to add something very important. Inflation!
If we assume a modest annual inflation rate of 1.8% (based on Singapore’s historical inflation rate of 1.83% over the past 30 years), the total would look like this:
Annual expenses (first year): $57,000
Expenses over 30 years (incl 1.8% annual inflation): approx $2.36 million

If we are talking about a retired couple (who share the car and domestic helper), their cumulative expenses over 30 years could easily rise to $3.5 million or more!

Bear in mind that while comfortable, the projections above are still fairly conservative. Mr Yeo’s vehicle expenses are based on a Corolla Altis and not a Mercedes, and his restaurant bills are on the low side.

Originally Posted by Unregistered (Post 74166)

The previous example was for a comfortable lifestyle where the retirees have a car and a maid. I see that people are incredulous of the $3.5m needed to sustain a couple in that lifestyle for 30 years.

Now another example. This time for a very Spartan lifestyle. Again, this was worked out by someone.

Projected Retirement Budget – Spartan Scenario

– Travel by bus or MRT
– DIY without a maid
– Substitute 20 restaurant meals with hawker meals
– Omit all holidays and explore Singapore
Using the same assumptions (1.8% inflation, 30 years lifespan post retirement), the total amounts needed would then be very different:
Annual expenses (first year): $1,400 x 12 = $16,800

Expenses over 30 years (incl 1.8% annual inflation): approx $700,000

For a retired couple, this works out to about $1.4 million or so, which is two and a half times lower than the earlier “comfortable scenario”. While this looks a lot more feasible for most Singaporeans to attain, it does entail some sacrifice in the life quality of one’s golden years.

Originally Posted by Unregistered (Post 74167)

If you opt for the CPF Enhanced scheme, you will get $3600 pm for a retired couple. So, you don't need any additional cash.

If you have at least two good children who contribute $500 each, you will get $1000 pm. Your passive income will be $4600 pm. This is more than enough provided you:
1. Don't own a car
2. Don't employ a maid
3. Don't smoke
4. Don't drink
5. Don't gamble
6. Don't do stupid things such as get rich quick schemes
7. Don't gamble in speculative penny stocks
8. Don't womanize

Lead a simple, peaceful retired life.

Originally Posted by Unregistered (Post 74168)

both me & wife are 45, and we already have the amounts each in CPF to qualify for the enhanced scheme. so in theory our retirement funds from 65 onwards is taken care.

we have about $1mil in cash and stocks now which should suffice for us from 45 till 65. just do a simply job and dont spend unnecessarily

we have a paid condo and car. two kids are in secondary school and doing well.

really looking forward to a stress free retirement.