Retirement Planning is Essential If You Intend to Retire Early.
Hello, my name is Chow. I'm happily married with a lovely daughter in university reading economics. I've been lucky to take early retirement a year ago when I was sixty.
I'm fortunate that I can afford to take early retirement and this is mainly due to my retirement planning. I must admit that I started my retirement plan rather late in my working life (i.e. when I was 38) but I would advise people to start planning much earlier than that.
When I switched job in 1986, my new employer offered me to join the company defined benefit (DB) plan which I happily accepted. The pension payout is a based on a formula linking the length of my service and my final salary. I contributed 6% of my monthly salary into the plan and the company contributed whatever is necessary to pay my pension when I retire and for the rest of my life. There was also a life assurance covering 3 times my gross salary should I die in service.
Like so many other companies, my company has now terminated the scheme because it is a very expensive scheme to maintain.
New employees are now offered a defined contribution (DC) plan which are not based on final salary pension payout.
A DC plan is a much cheaper plan for the company to maintain than the DB scheme. The pension payout is based on the performance of your investments in the pension pot. When you retire you use the value of your pension fund to buy annuities which is your retirement income for the rest of your life.
With the financial side taken care of, I now enjoy travelling, going to the theatres, going shopping and eating out with my wife. If I've some spare time in the future, I may take up scale modeling.
And to keep my brain stimulated, I've just started a website to interact with other retirees in our retirement-lounge.