Last week, I wrote about my present position vis-a vis my aims for retirement.
Today, I shall show my idea of where I want to be when I retire and my intended action plan to get to where I want to go.
And the map above is the position I want to find myself in when I retire.
With this, I sat down to think about where should I focus? The important areas are:-
a) The elder children’s personal finance education. My wife and I want to try and make sure that the elder two girls are financially literate and that they would not be a financial pain in anybody’s necks. They should be able to take care of themselves and be a sterling example to their younger siblings. As the formal education sector does little to prepare children for life, my wife and I have to do our part.
Thankfully, I have tons and tons of resources from the pf blogs on this.
b) The younger children’s education should be the biggest costs that we expect to face in the future. Their studies should be nurtured so that their grades are good enough to qualify for good scholarships.
Not withstanding the support given by many commentators to Mighty Bargain Hunter’s “Worried about paying for college, then don’t”, my wife and I rate our kid’s education as our duty.
We shall do what we can, in fact all we can, to ensure that the children get a better chance in life than we got.
I also hear Flexo’s comments whilst debunking yet other retirement myth. That children cannot be 100% depended upon to support the parents in retirement.
My wife and I just want to pay it forward. We are not expecting anything from the kids, anyway.
c) Health. This is an item that is “so, so important, but not urgent”. So it is usually left somewhere at the bottom of the pile. Exercise is one item that is left out when other so called more urgent things crop up. We shall focus on exercising and learning Chi Qong. This is an ancient Chinese art, geared towards guiding its users to gain tranquility, better health, fitness and also some self defense.
d) Take the businesses from the incubator level, nurture them and organize them such that my time involvement will be minimal. This has to be something like a 2 – 5 year plan, but should be started now. The goat farm is in progress. The planned launch is in July 08, the critical outstanding issue being the bringing in of our farm workers.
Another business is in the field of the leasing of telecommunication towers in Indonesia. This plan suffered a setback when the Indonesian Government issued a decree deeming this business to be closed to foreigners. However, we have come up with a workable alternative and are actively pursuing this now.
e) Clear my liabilities, leaving only the mortgage. Tackle the mortgage last. My family can achieve this by selling off one of our assets. This plan is currently in progress.
f) Nurture and grow this blog. I am not making any money from this blog. However blogging has made me really focus on the important areas of my life.
g) Generating some passive income. I may have missed the boat in socking away some good dividend paying stocks in earlier years. It’s my loss that I did not run into people like Dividends 4 Life when I was much younger.
I have to use all the skills I have acquired in my corporate life and put them into effect to systemize the operations of the businesses I am incubating. Much like what Michael Gerber has written in his book, E-Myth. The operations should be “engineered” in such a way that my time involvement would be minimal.
Then I came back to the other rule of thumb that I read from Plonkee’s comment to Flexo’s post that started off all this thinking. The need for us to have about 25 years of spending money during retirement.
The options are quite clear. Either
- Increase my income and get the 25 years nest egg, or
- Decrease my expenses.
I shall keep working on these two very sensible things to do. Nevertheless, the focus would be on the second option.
Now I have a nest egg of $X. This should grow to say, $Y, by the time I retire. This should have to last me say, 25 years. So per year I can spend $Y/25.
Where can I have a life that I want with this amount? Aha! More options fall on the table.
I can move to the country side in my own country. We already live well away from the Federal Capital. I can still go further rural. Or I can check out other countries.
Countries, where culture, food, transportation, housing, health facilities, education for the younger children and other normal barometers of living are acceptable to my family and me. This I can do now, the checking out I mean. India (where I have worked for 3 years and still have family there), Vietnam, Cambodia and the Philippines are countries that come to mind.
Suddenly the prospect of retiring as a semi derelict is no more seen as a possibility.
Life seems to be so much rosier, the sun so much brighter, the birds singing so much sweeter and I do feel a bouncier step as I walk.
Why not try a mind map yourself?