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How much is needed to retire?

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How much is needed to retire?

Postby NorthAmericanguy » Mon Nov 01, 2010 5:16 pm

I just want to get a general idea of how much money I should save up here in the states before I move to an Asian country (i.e. Thailand). This move is about retirement so I don't plan on working and it's also about excaping from being alone because people here in the states don't socialize with people who they don't know.

So would 300k US currency be enough to live on if I lived modestly and found me 1 good woman?
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Re: How much is needed to retire?

Postby Rock » Mon Nov 01, 2010 5:40 pm

Northamericanguy wrote:I just want to get a general idea of how much money I should save up here in the states before I move to an Asian country (i.e. Thailand). This move is about retirement so I don't plan on working and it's also about excaping from being alone because people here in the states don't socialize with people who they don't know.

So would 300k US currency be enough to live on if I lived modestly and found me 1 good woman?


How old are you? The younger you are, the more you should start with unless you are planning to work again.

With US$300K, you could generate 6-10% (US$18-30K) annually with moderate risk. That's US$1,500-2,500 per month. But, if you want your nest egg to hod its value for a lifetime, you need to grow it at the rate of anticipated emerging market inflation. At bare minimum, use 3%. That means you have to subtract 3% from the 6-10% rate I used above. So your left with 3-7% or US$9,000-21,000 -> US$750-1,750 per month. In Thailand, you could probably live on that in certain areas. But you would want to avoid Bangkok and the more expensive tourist cities. And you would need to find a quality woman who was frugal - not impossible but a challenge. Perhaps Phils would be cheaper?

Also, once you set-up your income generating investments, you could open a FX account to diversify your currency risk. US monetary policy has eroded the value of the greenback much faster than most other fiat currencies. Your account would allow you to use cheap leverage to invest in a basket of developed and emerging market currencies as well as some gold.
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Postby ladislav » Mon Nov 01, 2010 7:52 pm

I guess also if you can get $1000-1500 in net rental income per month, then you could live on that in the Philippines.
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Re: How much is needed to retire?

Postby momopi » Mon Nov 01, 2010 9:54 pm

Northamericanguy wrote:I just want to get a general idea of how much money I should save up here in the states before I move to an Asian country (i.e. Thailand). This move is about retirement so I don't plan on working and it's also about excaping from being alone because people here in the states don't socialize with people who they don't know.

So would 300k US currency be enough to live on if I lived modestly and found me 1 good woman?



What kind of standard of living are you expecting?
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Re: How much is needed to retire?

Postby NorthAmericanguy » Mon Nov 01, 2010 10:29 pm

momopi wrote:
Northamericanguy wrote:I just want to get a general idea of how much money I should save up here in the states before I move to an Asian country (i.e. Thailand). This move is about retirement so I don't plan on working and it's also about excaping from being alone because people here in the states don't socialize with people who they don't know.

So would 300k US currency be enough to live on if I lived modestly and found me 1 good woman?



What kind of standard of living are you expecting?


Well, I don't know what it's like over there so I don't know what to pick but I'm just fine with living in a small apartment that would be considered a clean middle class area.

Worse come to worse, I can live alone in Thailand and entertain myself, so no need for me to buy any property when I will have nobody to give it to when I die.

Edit: I plan on doing what I do over here in the states when I get over there which is read books, workout and live frugally. So to answer your question again I wish to seek a clean, simple standard of living.
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Re: How much is needed to retire?

Postby NorthAmericanguy » Mon Nov 01, 2010 10:50 pm

Rock wrote:
Northamericanguy wrote:I just want to get a general idea of how much money I should save up here in the states before I move to an Asian country (i.e. Thailand). This move is about retirement so I don't plan on working and it's also about excaping from being alone because people here in the states don't socialize with people who they don't know.

So would 300k US currency be enough to live on if I lived modestly and found me 1 good woman?


How old are you? The younger you are, the more you should start with unless you are planning to work again.

With US$300K, you could generate 6-10% (US$18-30K) annually with moderate risk. That's US$1,500-2,500 per month. But, if you want your nest egg to hod its value for a lifetime, you need to grow it at the rate of anticipated emerging market inflation. At bare minimum, use 3%. That means you have to subtract 3% from the 6-10% rate I used above. So your left with 3-7% or US$9,000-21,000 -> US$750-1,750 per month. In Thailand, you could probably live on that in certain areas. But you would want to avoid Bangkok and the more expensive tourist cities. And you would need to find a quality woman who was frugal - not impossible but a challenge. Perhaps Phils would be cheaper?

Also, once you set-up your income generating investments, you could open a FX account to diversify your currency risk. US monetary policy has eroded the value of the greenback much faster than most other fiat currencies. Your account would allow you to use cheap leverage to invest in a basket of developed and emerging market currencies as well as some gold.


I'm 31 and the plan is to move when I'm at least 45-50 years old, but if my mother is still alive, then it will be later.

As far as your advice, I really appreciate all this information, but to be honest, I refuse to put my money into something I don't understand. My last girlfriends dad was a big time stockbroker and he would try to explain investing to me but I could not understand it. Not only that, but I don't trust these banks and such... A few people I know lost money (one person all of it) who were investing in stocks, 401ks and other financial instruments.

I was hoping this could be as simple as work, save money, then move to a cheaper county to live because of the currency exchange difference alone. This is what foreigners do that I have met who told me their plans.
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Postby Contrarian Expatriate » Mon Nov 01, 2010 11:31 pm

300K is nothing but a drop in the bucket. What if you get ill, or have a person crisis?

If you have a pension, that might be enough, but short of that, 300K is just a good start and you would likely have to work to slow the erosion of that kitty.
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Re: How much is needed to retire?

Postby momopi » Tue Nov 02, 2010 1:25 am

Northamericanguy wrote:I'm 31 and the plan is to move when I'm at least 45-50 years old, but if my mother is still alive, then it will be later.
As far as your advice, I really appreciate all this information, but to be honest, I refuse to put my money into something I don't understand. My last girlfriends dad was a big time stockbroker and he would try to explain investing to me but I could not understand it. Not only that, but I don't trust these banks and such... A few people I know lost money (one person all of it) who were investing in stocks, 401ks and other financial instruments.
I was hoping this could be as simple as work, save money, then move to a cheaper county to live because of the currency exchange difference alone. This is what foreigners do that I have met who told me their plans.



OK, here's my $0.02:

* At 31, you're a far better catch to women than some 50-year old balding sex tourist. So if you want to go abroad, plan to go soon while you're still young, full of libido, and while your mother is still in good health. Instead of planning to be abroad in 15-20 years, consider going sooner, and return in 15-20 years to care for your mother. Your dedication to filial piety is admirable and shows character that's appealing to many Asians.

* If you prefer to stay in the US and work hard for the next 15-20 years, you mind as well play here (in the US). Make sure you're well paid for whatever you're doing. If you're looking for a wife, keep an eye out for the girl who'd lean over and open your door for you from the passenger side. And if you just want bling bling's, consider using agencies such as model quality introductions and seeking arrangement to "outsource" your dating:

http://www.ocweekly.com/2003-02-13/feat ... g-for-10s/
http://www.seekingarrangement.com/press.php

* For financial advice, I recommend visting this forum:
http://www.bogleheads.org/

A good (and simple) book to read is the Coffeehouse investor.
http://www.coffeehouseinvestor.com/

If you don't like stocks, bonds, mutual funds, etc., consider real estate. The rules are very simple, only buy something that you can rent out and make positive cashflow after expenses. Read the book "Rich Dad Poor Dad" by Kiyosaki for some ideas, but don't pay for his stupid rip-off seminars.
Last edited by momopi on Wed Nov 03, 2010 4:00 pm, edited 1 time in total.
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Postby MrPeabody » Tue Nov 02, 2010 5:04 am

The problem is that interest rates have sunk so low that even people who have a million dollars can't retire (in the US) - that is 3 percent of a million is only $30,000 a year. In order to make use of your money, you need to learn trading. I heard from an experienced broker that he cash flows his portfolio by writing options, and that with this method he can make 3 percent per month. If you could do that then you could retire on $100,000 dollars if you go to a third world country - 3 percent of $100,000 is $3,000 a month. The catch is that trading is hard as hell and most people lose money. You really have to take it seriously. I am currently reading up on options and simulating trades on the think or swim platform. You got to start somewhere.
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Postby globetrotter » Tue Nov 02, 2010 9:34 am

$30,000.

You can buy a house in Asia for $10,000 and you can live on about $300 a month. That will give you 5.5 years of income.

I maintain that any sane man will become bored out of his f***ing mind within 12 months of being 'retired' and then go and look for something new and productive and income producing to do as a hobby. Thus your assets will not continue to decline.

I strongly assert that 'retirement' is a scam to get you to work for 40 years and save $2 million dollars that bankers can then steal and invest and make fees and commissions off of. If you pocket $30k and then split they don't have your millions to play with, now do they?

Society wants you slaving away until you are 50 or 60 or 70.

Don't. It's a trap designed to benefit THEM, not YOU.

Me? I retired at age 47 years 8 months. After 1 year I became bored and decided to teach English.

$30k.
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Postby Rock » Tue Nov 02, 2010 7:52 pm

Here's a reality check:

1. The purchasing power of US$300,000 in 2000 according to CPI (which understates true US inflation IMO and has also been on average lower than Thai inflation) fell to just US$240,000 in 2010.

2. On this day in 2000, your US$300,000 could be converted to 13,044,000 Baht @43.48 exchange rate. Today, US$240,000 converts to just 7,166,400 Baht.

In 10 years, the purchasing power of your nest egg in Thailand would have fallen by 45% even if you had left untouched in USD non-interest bearing cash (ie not spent a dime).

There's no such thing as a risk free investment. But you can be fairly certain that US$ cash will lose value rapidly over time, especially in most foreign countries. It behooves you to take some risk to avoid the unattractive option of holding a wasting asset.
Last edited by Rock on Tue Nov 02, 2010 8:21 pm, edited 2 times in total.
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Postby Rock » Tue Nov 02, 2010 8:19 pm

catameran wrote:The problem is that interest rates have sunk so low that even people who have a million dollars can't retire (in the US) - that is 3 percent of a million is only $30,000 a year. In order to make use of your money, you need to learn trading. I heard from an experienced broker that he cash flows his portfolio by writing options, and that with this method he can make 3 percent per month. If you could do that then you could retire on $100,000 dollars if you go to a third world country - 3 percent of $100,000 is $3,000 a month. The catch is that trading is hard as hell and most people lose money. You really have to take it seriously. I am currently reading up on options and simulating trades on the think or swim platform. You got to start somewhere.


1. 3% generally doesn't even keep pace with inflation. Don't be deceived by CPI. Its highly understated IMO, part of our gov's deception of a very gullible public.

2. Selling naked options is high risk - let the seller beware, lol. Some hedge funds use this strategy generate stable returns and it can work for a long time if you target a modest rate - say 0.5% - 1.5% per month after performance fees. But when the shit hits the fan, these strategies blow-up big time. Many such funds lost half or more of their value in 2008-2009. Even Bernie Madoff claimed to use such a strategy with his Farfield group of funds and he may actually done so in the earlier days. Of course these funds all become worthless in a matter of days. At some point, the strategy failed and he had to revert to deception.

3. One slightly lower risk way to earn sale premiums is via OTC currency options. While equities may collapse in a short period, developed world currencies typically move more modestly. The most extreme move I've noted in the last 10 years was probably the GBP/JPY or GBP/CHF - both of these pairs have lost over 50%. But it happened gradually over time. If you stick to writing options with 1-6 months duration or less and more importantly, delta hedge in spot market, you can manage the risk down to a moderate level. The hedging will add a bit of instability to your monthly gains but will go a long way towards mitigating big downside.
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Postby keius » Tue Nov 02, 2010 9:28 pm

I think you needed a real hobby :P
When single, i went 4 years only working when i had to, tech consulting junk on the side when i ran out or started running out of money.
I had hobbies, tennis, working out, bars and boozing, World of Warcraft....which wasn't too bad since that game broke my bad gambling habit.
The gambling habit forced me back into the job market...sigh.
It gives you a chance to do things you always wanted to try..skydiving, mountain climbing. Learn how to swim, learn a new language, TRAVEL, MEET WOMEN.

Make a list and you'll find that you still won't have enough time.
Personally, i would've loved being in permanent retirement.

I will say that it is important to have some kind of skill or backup in case things go all to hell. Or have a BIG stash.
A second tier city in China is nice for retirement. Gotta be careful with your money though. Don't let people know how much
you actually have. Playing the bigshot is a bad idea. Don't plan to stay in retirement if you are stupid enough to get married.
300k in China will last you a long long time if you don't overdo things. Interest rates in stuff like CD's are great in China.
2 years ago, putting 10k US in a 2/3 year cd netted a annual return of 5.6% iirc. Could've prob found better. Compare to 1.4% in the states for a 5 year?
1 mil and you can live like a king til you croak :)

Prob need less cash in poorer countries.



globetrotter wrote:$30,000.

You can buy a house in Asia for $10,000 and you can live on about $300 a month. That will give you 5.5 years of income.

I maintain that any sane man will become bored out of his f***ing mind within 12 months of being 'retired' and then go and look for something new and productive and income producing to do as a hobby. Thus your assets will not continue to decline.

I strongly assert that 'retirement' is a scam to get you to work for 40 years and save $2 million dollars that bankers can then steal and invest and make fees and commissions off of. If you pocket $30k and then split they don't have your millions to play with, now do they?

Society wants you slaving away until you are 50 or 60 or 70.

Don't. It's a trap designed to benefit THEM, not YOU.

Me? I retired at age 47 years 8 months. After 1 year I became bored and decided to teach English.

$30k.
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Postby MrPeabody » Tue Nov 02, 2010 11:17 pm

Rock wrote:
catameran wrote:The problem is that interest rates have sunk so low that even people who have a million dollars can't retire (in the US) - that is 3 percent of a million is only $30,000 a year. In order to make use of your money, you need to learn trading. I heard from an experienced broker that he cash flows his portfolio by writing options, and that with this method he can make 3 percent per month. If you could do that then you could retire on $100,000 dollars if you go to a third world country - 3 percent of $100,000 is $3,000 a month. The catch is that trading is hard as hell and most people lose money. You really have to take it seriously. I am currently reading up on options and simulating trades on the think or swim platform. You got to start somewhere.


1. 3% generally doesn't even keep pace with inflation. Don't be deceived by CPI. Its highly understated IMO, part of our gov's deception of a very gullible public.

2. Selling naked options is high risk - let the seller beware, lol. Some hedge funds use this strategy generate stable returns and it can work for a long time if you target a modest rate - say 0.5% - 1.5% per month after performance fees. But when the shit hits the fan, these strategies blow-up big time. Many such funds lost half or more of their value in 2008-2009. Even Bernie Madoff claimed to use such a strategy with his Farfield group of funds and he may actually done so in the earlier days. Of course these funds all become worthless in a matter of days. At some point, the strategy failed and he had to revert to deception.

3. One slightly lower risk way to earn sale premiums is via OTC currency options. While equities may collapse in a short period, developed world currencies typically move more modestly. The most extreme move I've noted in the last 10 years was probably the GBP/JPY or GBP/CHF - both of these pairs have lost over 50%. But it happened gradually over time. If you stick to writing options with 1-6 months duration or less and more importantly, delta hedge in spot market, you can manage the risk down to a moderate level. The hedging will add a bit of instability to your monthly gains but will go a long way towards mitigating big downside.


The technique doesn’t sell naked options. All of the option spreads are fully hedged with determinable risk. They are low risk methods for a retirement accounts. It would include Iron Condors, Collars, and some vertical spreads to take advantage of directional movement. The broker I heard this from does it on his own account, and was in the business for thirty years. I have been simulating for less then a month and I am up more then the 3%, but will practice alot more before I use real money.
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peso rate

Postby starkeep » Wed Nov 03, 2010 2:13 am

8) The exchange rate used to be about 55 to 1 or better now its about 40 to 1 and not getting better. If these trends continue any dreams of a foreign retirement will be about imposible. My opinion it would be better to be retired before going overseas or have a lot of rentals or a good business. The us economy keeps declining and who knows when it will turn around if at all.
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