Binary Dollar posted an open mic discussion about How Much Money Does One Need to Retire. When I have read the comments just a few hours ago, I’ve noticed that many responded that they need millions of dollars to retire comfortably. Now although I haven’t really given much thought about it in the past, it only took me a few minutes to compute and decide to leave a response that I only need $200k to spend for the last few decades of my life.

Why? Simply because I live in the Philippines. Although the US dollar has depreciated considerably this year - it’s down to Php46 per dollar compared to Php55 per dollar last year I think, a dollar grows 46 times here! So if I have $200,000 when I reach the age of 30, my dream retirement age, I’ll have 9.2 million pesos, which when divided into two (inflation issues) is still approximately 4 million pesos. Four million pesos will allow me to have about 11,000 pesos ($239) for monthly expenses, which I think is more than enough if I get to retire with good health. Why only Php11,000 monthly budget? I never intend to retire with any debts and I believe in living cheaply.

How about my beneficiaries? Of course, I don’t want to, God forbid, die without leaving anything for my beneficiaries. So I also included in my comment that I need another $200,000 for my family and other people who I think deserve some inheritance. And while that money’s earning interest from any investment service I decide to keep it in, I’ll keep on reinvesting portions of its interest somewhere else to keep the ball rolling and maybe for me to afford some bits of luxury with my loved ones every now and then.

So yeah, technically, I’m planning to go for $400,000 for my retirement fund.

Anyone who thinks I’m crazy to have these financial goals? I’d love to hear from you.

Tags: retirement, dollar depreciation, living cheaply