With the current global economic fluctuations, many companies are facing financial challenges. Many industries are considering layoffs, and experienced middle-aged wage earners cannot escape layoffs. When people become unemployed in middle age, should they continue to work or retire? How do you know if your savings will support retirement? Although the following case is in a foreign country, it is worth pondering for Hong Kong readers.
There is a 49-year-old single disabled person in the United States who has just experienced unemployment for the first time in his life. He is very anxious, worried about his prospects and the impact of his disability on his work, and at the same time he is bored with his career. He also used a variety of online retirement calculators, some claiming that he is not fully prepared to retire now, but there are other calculators that show that retirement is feasible now, and he does not know whether the recommendations of these retirement calculation tools are worth referring to.
Personal situation:
Age: 49 years old
Marital Status: Single
Health Condition: Disabled
Work status: just unemployed
Current deposit: US$1.2 million (about HK$9.3 million)
Monthly expenses: Just under US$5,000 (about HK$38,000), of which 20% is used for travel budget
Multiple considerations should be taken into consideration, and retirement calculation reports should not be relied upon alone
Losing your job is indeed a devastating experience, but fortunately, you have accumulated a relatively good savings, and there is still enough time to re-plan and solve the problem. First of all, the online retirement calculation tool has a certain reference, but it is not suitable to rely on it completely. The operation of these retirement calculation tools is to allow users to enter some data and then generate some suggestions. This is not comprehensive and cannot list and analyze all the data for individual situations. There are many factors that determine whether you can retire, including emergency savings, taxes, inflation that affects the cost of living, housing issues, etc. All of these may fluctuate over time, and all factors should be considered comprehensively according to the current situation factor.
9 million deposits exhausted in 20 years
Even if all expenditure budgets are taken into account and inflation is not taken into account, the savings of US$1.2 million to meet the monthly expenditure of US$5,000 is actually quite strenuous, which is equivalent to being exhausted in 20 years. Considering that the main character in the case is still young, currently only 49 years old, if there is no continuous investment, or no reduction in expenses, the current savings are likely to be used up before the age of 70.
keep working to maintain income
The main character is a disabled person, so insurance is very important, and if there is no other source of income, savings alone will quickly deplete the $1.2 million. Therefore, it is advisable to look for some work income, even part-time or freelance, that can be used to offset the cost of health insurance. Even better, find a full-time job with employer-insured insurance that you can use to make ends meet and not draw on what little savings you have for a while. It is also unhealthy to continue working in your current job because you are bored with it. Consider pursuing some other careers that interest you, or branch out in your current field, using your skills and experience without feeling too much pressure.
Consider delaying travel to find directions
When in this predicament, consider delaying travel. Some people will take advantage of the layoff period to rethink their goals and directions, use this opportunity to take courses they are interested in, enrich their resumes, and prepare for their return to the workplace in the future.
Find a Qualified Financial Planner
It is advisable to seek out a qualified financial planner who will act in your best interest, also known as a trustee. There is an option to work with a person who can keep an eye on your investments and provide timely assistance should a situation arise. If you don’t want to have an ongoing relationship, at least at first, there are professionals who can help check, and they also do some calculations that are more reliable than the reports from online retirement calculator tools.
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2023-08-01 05:49:00
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