I recently achieved 100 million KRW (South Korean Won, about 86,000 USD) after a bit less than 5 years of work. I'm somewhat proud of myself for being diligent, but I'm afraid if this is not enough.
I'm definitely not a professional in accounting or investing, but I did very crude math myself with these parameters (all in KRW and inflation-adjusted):
- Age: 30
- Investment input: 83,281,657 - I used a personal accounting app to get this value. I think it is accurate enough, but not perfect.
- Investment value: 102,386,242
- Annual investment: 16,800,000 - About a half of my income
- Buffer fund: 43,200,000 - Additional fund in case of emergency
- Annual withdrawal: 21,600,000 - National Pension Service claimed that proper living costs for a couple is about this much in early 2014. I'm single, but I want to be prepared.
- Annual real return rate: 2.00%
- Tax on profit: 15.40% - Over-simplified.
- Life expectancy: 90
And this graph is the result.
According to this, I can retire at age 58. But there are things I'm worried about.
- The tax is too hard for me, so I used a VERY simplified single tax rate.
- I like my work, but I don't want to work for that long. I don't know what I can work at that age.
- I'm working on IT. I heard this line of work has an early retirement age. Working until I can retire seems an optimistic expectation
- I could invest about half of my income only because I'm living with my parents. My parents don't mind about this, but I can't expect this would last forever.
- I don't have a car or a house for myself. (A car is optional here, but you never know.)
- My homemade calculation can be wrong, which might mislead me to false hope/fear.
- Considering my self and my future spouse is already big. But what about children, educations, and medicals... It almost a horror to me.
My point is, even if I do my best, retirement still looks hard. Can you give me some wise words of yours to achieve my retirement?