Retirement Planning

The baby boomers born after WWII (from 1946-1964) are heading into their 60s, and according to the Council for Economic Planning and Development and in 2007, Taiwan’s population over 65 will reach 10% for the first time. People are living longer with the inevitable trend toward a lower birthrate, counting on the next generation for old age support is an idea of the past.

So when and how do you begin planning for retirement? What kind of things must you pay extra attention to?

• Choice of Living
  Recently, there have been talks about developing a “Long Stay” community in Puli, Nantou County to attract retired Japanese people to relocate. In fact, many retired Taiwanese are also relocating to China as the culture and language are similar, the cost of living is low and care-taking expenses are low. This shows that the more easily adaptable a place is, the more attractive. For those who are more financially well off, Canada, Australia and New Zealand are also top choices for relocation. In fact, there are many choices in Taiwan as well. Experts recommend those who own a home to fully utilize this asset at retirement as the mortgage is often repaid completely by then, and children usually have left the home - requiring less living space. One may consider moving to a smaller, more convenient place closer to the city center that is convenient for shopping and medical services; or consider renting out the home and moving into an old age community or nursing facility that provides care-taking functions and where one can enjoy living in a community.
• Medical Insurance Planning
  However, to enjoy a carefree retirement, one must have comprehensive financial planning. Financial consultants tell us that one must prepare for sources of income after retirement early, and these sources of income are no other than savings, investments and insurance. The usual age limit for insurance subscription is 60 so one is urged to start subscription early to be protected early on and enjoy lower premiums. After retirement, one can allocate a set of funds into single premium immediate annuities and receive annuities to pay for living expenses as soon as subscription begins. One of the biggest risks facing the retired is medical and care-taking expenses, thus, if one depends solely on insurance for medical expenses, one should add a whole life medical and disability rider to the life policy. For those with a family history of cancer, addition of a cancer policy is also recommended.
• Lifestyle and Travel Planning
  A lot of people hope to be able to travel the world after retirement, but as there is no stable income after retirement and the investment instruments at this stage of life are often low-risk fixed-income products with low return, seniors making travel plans are often constrained both physically and financially. If one has a high-income replacement rate, is healthy and has no language barriers, it is possible to plan long-distance trips with a more relaxed budget. But as long as the trip is well planned, short-distance trips can be equally enjoyable.
  
  To enjoy a dignified and happy retirement life, besides being free of financial worries, being physically and mentally active is also important. Doctors recommend that seniors maintain a habit of daily exercise. They can choose milder forms of exercise such as hiking, jogging, Qi-gong, Tai-chi or folk dance, which not only exercises the body but also builds a sense of belonging for seniors as they exercise in a group, and can help release negative emotions. In terms of diet, seniors need to pay attention to maintaining a diet that is low in oil, potassium and stimulating substances, but high in fiber. They should also take advantage of the free medical exams provided by the National Health Insurance to be on top of their own physical conditions.
  
  Seniors can also take advantage of the courses offered for seniors at community colleges usually with reasonable fees; these courses help them gain knowledge and stay mentally young. They can also choose to volunteer at hospitals, religious organizations or charity foundations to give back to society; these are all good options for planning a retirement lifestyle. With the above in mind, there is no doubt that you can lead a fulfilling retirement life.