The reason why Retirement Plans Fail.

Salarymen or ordinary people wish to live happily in their retirement. Especially in the Thai Aging Society where people tend to have no kids due to the change in economy. Therefore, making a plan for retirement is important. However, some might not succeed or feel like anything is not according to the plan. Let’s look at the reasons, and see if we fit into these five. If we do, we’d better hurry to fix it up.

1.Need to prioritize

Many people’s expenses increase after they start working which is a result of an increase in income. The increased expenses might decrease the intention to save money for retirement. They may choose to spend money for themselves without thinking about the consequences of their actions. They will realize what they have done when they have no money left or have debt to pay. Thus, it is important to be conscious and have more reason before spending. Consider whether it is necessary, it is one of the 4 requisites or it is about life insurance or not.

Many people neglect their goal of saving for themselves in their retirement because of the increased expenses. They only focus on short-term spending. Therefore, they have failed to save money for their retirement.

The following are the examples of expenses; house purchasing, car purchasing, marriage, educational tuition for their kids, resident modifying cost, illness, or accident. The recommendation is that health insurance should be used as an aid if you have to go to the hospital or if you have to pay a separate amount from retirement of at least 1 million baht.

2.Feeling that retirement is hard.

There might be a feeling like it is still a long time before retirement, it is impossible to save money for that long, feeling desperate to save money, or think it is so hard to save money after calculating something. Those are the reasons that destroy the intention to save money and they will eventually stop saving and turn to spending more at the present time. Nevertheless, the more you study about retirement, the more you know that it is nor that hard.

3. Investment should be adjusted.

If the deposit interest is not enough to use as a retired money, look for a higher deposit interest which is provided by many banks and have many products to choose such as high-interest digital deposit or saving life insurance. For investors who invest in the low-risk rate, invest in the high-risk rate because the more risk it is, the more return of the investment. Those return of investment would be enough to use as retirement savings. However, it is based on your income and it is important to carefully study the investment. Otherwise, it can make money go away in an instant.

4.About five years before retirement, investment adjustments are needed.

About 5 years before retirement, the risk in investment should be reduced to 10%. The investment should be shifted to lower-risk funds, and most importantly, they should look at returns sufficient to meet inflation in the future. The following is the calculation method;

Retirement savings of 10 million baht should be invested in 10% of retirement.

= 1 million to invest after retirement

The amount of 1 million for investment after retirement is divided into 10% risk stocks.

= The amount of money to invest in a fund with a risk of 100,000 baht.

5.Late preparation

Working people tend to spend without thinking, which may lead to late preparation. They think that they have a provident fund or some of the RMF funds, gratuity, or pension from the social securities, and thought that is enough money for retirement. Nevertheless, one thing that they seem to forget is the inflation rate that is rising each year. So calculate it carefully.

Is social security money enough for the post-retirement period?

For those looking for other sources of money, such as Social Security, Social Security will pay gratuity (in the case of fewer than 180 months or 15 years of contribution) and pensions at the end of 55 years of completion, no less than 180 months of contribution, regardless of continuity (no provident fund). It is not recommended for early retirement for such a little amount of money. This is not the main source but just a helper because the average amount of money after retirement is not more than THB5-6,000 or by the age of employment, so it is not enough to be used for retirement.

What should be considered If you want to succeed in early retirement?

Many people live longer than expected, using up the money for retirement early can cause their retirement to fail.The retirement allowance should be set at 85 years, based on the average age, or pension insurance for the elderly, which can be extended up to 99 years. The matter of mind to prepare for retirement may be to seek a hobby, social work, and manageable money when they need to enter retirement or money management. The little return on investment will not be sufficient for post-retirement or over-risk investment, resulting in a loss of return on investment not exceeding the expected target.

What should be accounted for when entering retirement age?

To begin with, check your spending each month, including water, electricity, and food expenses, according to your lifestyle.

Other early retirements may be unintentional, such as being laid off early or having health problems. Early retirement preparation is not just about financial planning, investment, investment education, trustworthy investment institutions, stability, and consistent dividend payouts. As well as mental conditions that need to be changed when entering early retirement. If we are prepared and prepared early, it will not be difficult to succeed in early retirement.