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
