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Finally it has been worked out $785,000 plus a mortgage free house for a comfortable retirement.
https://www.stuff.co.nz/business/mon...ces-retirement
Or has that been pointed out earlier in this thread. It is possible for me but will involve some significant sacrifice or some lucky investment decisions between now and retirement. Not sure if scrimping and saving my whole life for a comfortable retirement is the best option. Options are decreasing fast as time seems to speed up as I get older.
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Originally Posted by Aaron
Finally it has been worked out $785,000 plus a mortgage free house for a comfortable retirement.
https://www.stuff.co.nz/business/mon...ces-retirement
Or has that been pointed out earlier in this thread. It is possible for me but will involve some significant sacrifice or some lucky investment decisions between now and retirement. Not sure if scrimping and saving my whole life for a comfortable retirement is the best option. Options are decreasing fast as time seems to speed up as I get older.
If you start with $52k at 25 years of age, then a 7% annual return compounding will get you to $785,000. (with no further additions)
So in theory that target should not be too hard to achieve. Most people would contribute say $2,000 per annum to their kiwisaver. If you start at age 30, you should be there by the time you reach retirement. (Big emphasis on starting early goes without saying).
For us in our 40's or later that target may be harder to achieve via traditional mean. A good friend of mine has about $52k now in his kiwisaver. Unfortunately for him he has about 20 years to retirement. That means at 7% compounding will only get him to $201,200.
So the moral of the story is.. start as early as you can.
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Originally Posted by blackcap
If you start with $52k at 25 years of age, then a 7% annual return compounding will get you to $785,000. (with no further additions)
So in theory that target should not be too hard to achieve. Most people would contribute say $2,000 per annum to their kiwisaver. If you start at age 30, you should be there by the time you reach retirement. (Big emphasis on starting early goes without saying).
For us in our 40's or later that target may be harder to achieve via traditional mean. A good friend of mine has about $52k now in his kiwisaver. Unfortunately for him he has about 20 years to retirement. That means at 7% compounding will only get him to $201,200.
So the moral of the story is.. start as early as you can.
Definitely, but I challenge the figure of 785k. I know several people in their late 60s or 70s with nowhere near that amount, but quite comfortable in retirement.
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Originally Posted by fungus pudding
Definitely, but I challenge the figure of 785k. I know several people in their late 60s or 70s with nowhere near that amount, but quite comfortable in retirement.
Totally agree. My parents have way less than the 785K, but have a home without mortgage. They can get by on super if they have to. Dad even has a yacht that is moored at a marina although he does still work a bit to pay for the costs.
If you have a home with no mortgage and the rates are not too high, you can live off super. If you have any savings, then things are quite comfortable.
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Originally Posted by blackcap
If you start with $52k at 25 years of age, then a 7% annual return compounding will get you to $785,000. (with no further additions)
I agree start early no doubt but 7%?? take off tax at say 28% factor in inflation of 2% (say average of 1-3% targeted figure by the f**kheads at our central bank) if I am not much mistaken(and I could be so check my workings and reasoning) to get a net real return of 7% your investment needs to return 12.5% (x-.28x-.02 = .07)
Good luck with that in a low interest rate world awash with debt unless you are prepared to move out along the risk curve.
Last edited by Aaron; 29-03-2019 at 10:34 AM.
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Originally Posted by Aaron
I agree start early no doubt but 7%?? take off tax at say 28% factor in inflation of 2% (say average of 1-3% targeted figure by the f**kheads at our central bank) if I am not much mistaken(and I could be so check my workings and reasoning) to get a net real return of 7% your investment needs to return 12.5% (x-.28x-.02 = .07)
Good luck with that in a low interest rate world awash with debt unless you are prepared to move out along the risk curve.
This low interest rate world awash with debt is a recent phenomena and will not be around forever. Saving for retirement is a very long term action. I was being conservative with my 7%. 10% is more close to emperical evidence. (Rf + 7%) was the standard when I did finance at uni. Agree I did not take tax into account.
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Originally Posted by blackcap
This low interest rate world awash with debt is a recent phenomena and will not be around forever.
Japan has been at it for 30 years I don't have that much time.
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Originally Posted by Aaron
Japan has been at it for 30 years I don't have that much time.
we don't live in Japan. Anyway you may just have to do with a little less or save a bit harder right now
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Originally Posted by blackcap
we don't live in Japan. Anyway you may just have to do with a little less or save a bit harder right now
But the central bank is working from the same playbook. NZ is further behind than other countries but I wouldn't be surprised to see the US federal reserve bank buying equities directly in a year or two.
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