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Feb 03 2011

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Elements of Your Retirement Plan

When you are doing financial planning for your retirement, there are several key areas to consider;

  • Setting your lifestyle goals (how much do I need to live on?)
  • Longterm CashFlow projection (how do my sources of income fit with my expenses?)
  • Investment Plan (how will I invest to meet retirement goals?)
  • Tax Plan (how can I minimize this, my biggest expense?)
  • Estate Plan (where do I want my assets & income to go when I die?)
  • Risk Management (how do I reduce the risks of running out of money?)
  • Regular Reviews (how often should I thoroughly analyse my plan?)

Now, if you “SINGULARITIZE” those elements, here’s what else you get;

  • – Setting your lifestyle goals (how much do I need to live on – IF I LIVE  120 OR EVEN 400 YEARS)
  • Longterm CashFlow projection (how do my sources of income fit with my expenses? – BUT MY SOFTWARE DOESN’T GO PAST AGE 100!)
  • Investment Plan (how will I invest to meet retirement goals? – IF MANY OF THE INVESTMENTS I NOW HOLD MAY GET RADICALLY EFFECTED BY CHANGES OF THE SINGULARITY?)
  • Tax Plan (how can I minimize this, my biggest expense?  RRSP’S TURN INTO RRIFs WHICH ARE REQUIRED TO PAY OUT 20% PER YEAR AFTER AGE 94 – AT THAT RATE, MY RRIF WON’T LAST UNTIL AGE 100!)
  • Estate Plan (where do I want my assets & income to go when I die?  –  BUT IF I DON’T DIE FOR THE FORESEEABLE FUTURE, MAYBE I SHOULD BE GIVING MONEY AWAY WHILE I AM ALIVE AND CHANGE MY THINKING ABOUT LEAVING THINGS IN MY WILL! )
  • Risk Management (how do I reduce the risks of running out of money?) INFLATION OVER 20 YEARS IS BAD ENOUGH – WHAT ABOUT 100 YEARS OR MORE??   IF I AM NOT EARNING MONEY, THEN THE RISK OF A BIG LOSS IN MY INVESTMENTS IS EVEN A BIGGER RISK IF I AM AROUND LONGER!
  • – Regular Reviews (how often should I thoroughly analyse my plan?  IF I LIVE A VERY LONG TIME, I WILL REALLY NEED TO BE WATCHING MY SITUATION CLOSELY TO ADAPT TO CHANGES  AND MAKE SURE I DON’T RUN OUT OF MONEY!)

So what do we do?  Stay tuned! (of course)

Cheers,

Michael

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