Creating a Retirement Egg Nest is actually in 3 parts:

1. Earning well so that you can think of Retirement as a great luxurious product that YOU can afford.

2. Accumulating well -saving and investing smartly.

3. Learning how to withdraw once you have retired.

Now about (1) I cannot do anything. You need to study well and then decide whether you want to earn quickly (banker, insurance executive, fund management, etc) – however this life could mean a burnout at age 45. The other option is you become a professor in a Govt. subsidized college with life time guarantee of a job till you are 70 and an indexed pension after that.

We will look at the 2nd part – of accumulating well for retiring.

How much is too much for Retirement? 

Remember if you retire at 54 and die at 94 it means you will live 40 years in retirement and if your wife dies at her age of 94, it means about 44 years in RETIREMENT. It is easily a very long time to live WITHOUT A PAY CHEQUE – UNLESS you create one. So given the fact that we do not know

a) how long we will live

b) how much we will spend in retirement

c) how smart or stupid our asset allocation that we will do

d) we may want to shift to a “No brain, no tension, simple portfolio” by the time we are 75

etc. etc.

we cannot ever estimate how much money we are likely to need.

Also if you retire at say 54 you are likely to seek some entertainment (man does not live by bread alone!) and entertainment is expensive. Whether it is travel or sport or a combination of the two you will need money to do it.

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  1. Dear Subra,

    Could you please do a post on NRI investments . Fixed deposits vs Debt Funds from an NRI point of view . Thanks a lot.

    Best regards,
    Jagan

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