When To Plan For Retirement (4 Level Formula Given!)

This is a common question! You may have thought of it before too!

Is Age25 too young? How about Age35, still too young?

Then is Age45 too old?

Use this formula to understand better when to prioritise for retirement planning!

Level 1: Just Started Working

​If you are in this level, chances are you've just graduated and are now working in a junior level position in the company.

During this level, you may still have student loans to pay.

You may still be building your first of capital to invest.

Quick story: I remember back in the days when i just started working and during that period, i was learning all i could about trading and investing for my first $10,000. I always imagined that i would achieve 10 - 20% rate of return on all of my investments and it wasn't until through a financial crisis that i realize how naive i was.

Being good at Investment is not easy and returns are not a given until enough experience is accumulated.

Retirement planning now? I feel there are more questions than answers looking back at this stage.

Level 2: Training Years (Worked around 5years?)

If you have worked for a few years, you'd probably have gotten a slight pay increase after getting a promotion from your junior position.

At this stage of life, you've probably have not experienced too much life changes yet. True?

There could be marriage coming up and kids on the horizon.

I know you may be eager to start planning for your retirement but from my experience with my private clients in financial planning, this possible life changes coming ahead may AFFECT YOUR EXPENSE STRUCTURE TOO MUCH!

You may have ambitions to buy the house first and such a big ticket item would impact your planning severely. 

I'd suggest just investing with no worries of retirement use yet.

Build a portfolio for yourself and get a TASTE of passive income!

​Level 3: Specialist Years (Worked more than 10 years)

If you are in this stage, you'd likely see serious income come in. If not, you may be in the wrong industry or you haven't plotted your career well.

Below is a pay scale based on age group. At this stage, Saving $30,000 - $50,000 a year should be easy.

(Source from M.O.M Labour Force in Singapore 2018)

If you are earning well but not saving well, you might want to start cutting back on expenses as this is a very crucial stage in your life.

Through survey, most Singaporeans feel need at least 1.5 Million in terms of a retirement port to retire successfully. A way to get that is by saving $50k for 20 years at 5%p.a = $1.65 Million.


This is the BEST time to start planning your retirement as whatever decisions you make now will impact decisively on your retirement years.

At this level you still have at least 20 more years towards retirement and compounding money at this point of time is very important for you.

Get exposed to guaranteed retirement planning products. Top up your CPF.

If you're not invested much, it's ok because not everybody has the time and affinity to be successful at investing. But it's a time to get started.

Level 4: Expert Years (Close to peak in career)

While income is fantastic, you do not know how much longer you can sustain this level of income. This is a common emotion I hear from private clients.

After the peak is a decline. There's definitely no shame about it. Rather, it's a journey well done.

There's good news too. If you have children, they are closer to graduation and they are getting of your books in terms of expenses.

At this point is to important to look carefully at your financial planning. This is your last stage. Once you are past 55 and haven accumulated much assets, there's very little that can be done.

Hopefully you have fully paid up your house or you own multiple properties.

You have seen a lot of financial products and investment ideas in the market.

Instead of looking for home-run kind of investment ideas, look for solid, steady and trustable retirement solutions.

Again, get exposed to guaranteed retirement planning products. Top up your CPF.


Start retirement planning once you've clocked 10years of work.

And investing properly is a big component of getting your retirement cashflow.

This video is to share 4 simple rules of investing

1) 1:10 Keep your winners

2) 2:07 know your investments or know your fund well

3) 3:34 Do not catch a falling knife

4) 4:06 Avoid hot investments

What can you start doing today? Watch the following video below.

Commit a sizeable amount ever year towards investing and be ambitious.

If you're looking to find out more on retirement planning, contact me below for a preliminary discussion and I'd get in touch with you real soon to make positive changes! See you!

Last updated on September 22nd, 2019 at 11:45 am

The Astute Parent

A parent who has a sharp acumen on sieving through 'alien' financial jargon to dish out bite size financial tips from a parent's perspective.

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