Five Cents Ten Cents

The more I read about lifestyle design and think about how it applies to retirement, the more I realise that my paradigm on what constitutes retirement has fundamentally changed.

Previously, I used to think like what many of us did, that retirement was an age and it was not to work. But increasingly, my own research and reading of books such as Tim Ferriss’ “The Five Hour Workweek” and thinking about the day-to-day trends we see in Singapore has led me to re-evaluate what it means to retire when I advance another 20 years in life from today.

Retirement is Not an Age

The CPF system and the traditonal life of study-work-retire is under pressure. First of all, increasing life expectancy sees us living longer and hence needing to fund our living over a longer period of time. Secondly, the concept of lifelong employment and having a job for life is under threat from today’s volatile world. Thirdly, research has shown that mentally we degenerate if we do not keep ourselves active mentally and physically after we transit from a full-time career to a post-career lifestyle of not going to a routine of working from 8.30 AM to 6.00 PM Mondays to Fridays.

I see retirement as more a lifestyle design issue in that one needs to plan for how one can live on possibly reduced cash flows from a full-time job and transit more into a lifestyle dependent on less certain cash flows supplemented with some freelance type of work and passive income from CPF or other sources.

Continuing Cashflows Post Career

To continue to thrive post-career when one is close to the “official” retirement age of 62 (will probably be 67 by the time I hit that age bracket), one needs to plan for cashflows or a source of income then. Our CPF will only allow us a very subsistence type of living if we have minimum sum. Many will barely have it as most of our CPF is parked in our homes. Thus, I realise that one of the paradigm shifts that occurred for me was to be open to monetising my home through renting it out.

Now if I rent out my home, where am I going to stay? I’ll address that part in the later part of this article.

The other part of having cashflows is to have some useful and marketable skill that can translate into an income source. I believe I can do consultancy and training in the areas of public speaking, internal audit and fraud as well as general softskills type of “management” training. What I am doing now to build up those skillsets are to continue with my toastmasters activities, to deliver training in my current job as a value-add to my organisation and to continue to read widely in these areas to beef up the knowledge part. The toastmastering and actual conduct of training courses (beyond) my job scope  and speaking at conferences and seminars help me put into practise those skills needed in the future.

Living in a Lower Cost Environment

It is already happening. The Government has allowed us to use our Medisave in lower cost countries’ medical facilities. Taking the next logical step in the lifestyle design equation, why not transplant ourselves into a lower cost ASEAN country? This can work because we can monetise our main asset – our homes by renting them out for income, and then using that income to live more cheaply in a lower cost country. My current target is Thailand because it is quite big and you can find interesting locations to retire.

The catch is language. I have enrolled in a part-time (evening) conversational Thai course and intend to learn written Thai. I give myself 20 years to get fluent in the language and I am starting NOW even though I can actually pick it up later but I think planning ahead by taking the actions now will put me in a much stronger position to do so later.

By learning Thai now, I also can access more of Thailand’s culture and lifestyle as a tourist and slowly work up to be a retirement resident there in the future. Again, it gives me 20 or so years to get myself immersed into Thai culture and living there.

I am also planning to get my class 2B licence so as to learn how to ride a motorcycle. Getting around is not a big problem if you can drive or ride a motorbike. Given the economies and practicalities of getting around by bike in our neighbouring ASEAN countries, I realise learning to ride a bike would be a useful lifeskill going forward.

I feel excited about this plan because I think there are many direct and indirect spin offs from executing it. The skills such as speaking Thai and riding a bike will come in useful even in my life now as I can travel to more locations within Thailand as a tourist. Having a class 2B licence now will also make transportation easier now as my current home and workplace takes 2 buses to get to but would probably take me 10-15 minutes riding time depending on traffic condition. Hence, riding a motorcycle makes a lot of sense as my spouse takes the car on most days.

Once I learn Thai, I can shift my residence to Thailand and probably live off the rental of my home. I can supplement my income by teaching Thais English or to do training in Singapore in the areas of my professional interest.

Have you seriously considered your post-career plans?

Does it involve a radical move to a lower cost country?

Share with Panzer in the comments section.

Be well and prosper.