Seriously, everyone is encouring savings, (esp. since Nat'l Insurance is shaky), but no one is saying what the target amount(s) should be, twice your salary, three times your salary. Is there any formula we Bahamians should be following or keeping in mind?

I guess it depends on how much you want to enjoy your retirement.....I fyou just want to feed yourself, it should not be that much unless you are trying to leave something behind for future generations....probably several hundred thousand IMO. But if you are looking for a comforatble and andventerour retirement ei. travelling, moving to another neighboorhood, making your hobbies full-time, then you would need much more.

I'm looking to make a muti-million dollar nest egg...starting now.

I'm looking to make a muti-million dollar nest egg...starting now.


Well get it then...lol! That's great.:)

OP, I'm not sure how much $$$ exactly it takes to retire, but I've been given some tips that I love to pass on. I heard 20% of your salary is a good place to start. If mortgage, insurance, other bills, necessities, loans, etc. don't rape your wallet, you can always add more than 20% to your account each month. Also, if you get a bonus...throw it into your account and pretend you didn't get one. Sometimes people just blow through their bonuses cuz it's extra cash on hand. In about 30 yrs when you're ready to retire, you should have a couple hundred thousand in the bank...depending on what your salary and savings were to begin with.

Also, a sure-fire way to sit pretty during retirement - get a side hustle. Start from now...or at least before 40. Open a small business (or large one...lol), build and rent some apartments...etc. Just do anything [legal] to keep a positive cash flow on the side. lol. That way when you're old, your money will be working for you instead of the other way around.

Originally Posted by chancellor
Also, a sure-fire way to sit pretty during retirement - get a side hustle. Start from now...or at least before 40. Open a small business (or large one...lol), build and rent some apartments...etc. Just do anything [legal] to keep a positive cash flow on the side. lol. That way when you're old, your money will be working for you instead of the other way around.
Great advice...I especially liked the side hustle thing.

Great advice...I especially liked the side hustle thing.



Yes, the tuck shops-mobile cart side hustle have been very, very good to me! LOL! :p


Seriously, take one hour of each day's wages and save it. That is advice from David Bach, but still a very good place to start.

If the Bahamas Government ever starts issuing bonds to the public, I will be the first face in line!

Seriously, everyone is encouring savings, (esp. since Nat'l Insurance is shaky), but no one is saying what the target amount(s) should be, twice your salary, three times your salary. Is there any formula we Bahamians should be following or keeping in mind?

I RE %30 OF YOUR SALARY AND EVERY YEAR HAD %5,BECAUSE THE PRICE OF LIVING IS RAISING FASTER THAN THE TIDE COME IN.

This is a really a great question and I'm happy to see it being asked. A simply formula you can use is take your current earnings and realistically estimate what you feel you will be earning at retirement. Then multiply this number by 20, the number of years you are likely to be retired. This is then divided by the number of years you have left before retiring to give you an estimate of your annual savings needed to achieve your accumulated amount.
1. $25,000.00 x 20 = $500,000.00 - Amount you'll need for retirement
2. $500,000.00/30 = $16,666.67 - Amount you'll need to save annually
This is an unadjusted picture of how much money you need to put aside to produce your anticipated retirement income level. Bearing in mind that you will benefit from various investment returns.
I would caution that the biggest problem you will have is your ability to "PROCRASTINATE" The longer you take to get started the more difficulty you will have in accumulating the money you will need for your retirement.

^Close.

FV = 500,000
PV = ?
Int. = 6%
PMT = 0
Yrs = 20

PV = 500,000/1.06^20 = 155,902

You can invest 155,902 now at 6 percent for twenty years or 13,599.30 every year for twenty years. In twenty years when you start withdrawing funds, you can withdraw 36,324 a year for thirty years (if you can still earn at least 6 percent on the remaining balance).

To add, housing will be the largest part of your expenses. So when someone tells you that you need 13,000 to 15,000 dollars to retire comfortably, there's no need to panic if you only make 36,000 a year. If you're paying 1,000 a month on a mortgage you can consider that a part of your savings. Your house is probably the only thing you'll have enough equity in when twenty years rolls around.

I RE %30 OF YOUR SALARY AND EVERY YEAR HAD %5,BECAUSE THE PRICE OF LIVING IS RAISING FASTER THAN THE TIDE COME IN.

Abroad, the forumula is more like 60-70% of your salary. It is very hard to plan for retirement in the bahamas unfortunatly. Hopefully, you can find a job with a good pension plan cuz you know most bahamians dont save for the future. If NHI comes into effect it will be easier in some respects.

I heard some interesting information coming from Fidelity Bank. Money back mortage and assue savings as well as others.

I'm going to sit with them next week with a view of moving my mortage and finding out what other benefits they have to offer.

Interesting topic.

With the price of lots costing almost as much as the house, one has to be creative to save money here. When the house is finally built, home/hurricane insurance is just to high. I was shocked when an appriser(sp) told me my house was valued $300,000, thats up $50,000 from TWO years ago!! TRUST ME, THEY ON DRUGS!!

It sounds good on paper but when I called to get the insurance premium, my premium went up by $2000. The insurance is due in September, last year we paid $4400. So far, we have not received the usual notice of an increase in premium. That will surely come around August. There is NO WAY I am going to pay over $6000 in insure a house I built for $130,000 8 years ago. I know I can't afford NOT to. Sorry I can't afford to do it either.

We have decided to drop our contents insurance as in order to get any benefit from this insurance one has to increase it every year. The deductable is another rip off. We figure if we have a fire or hurricane which we hope is total damage without anyone getting hurt, we can replace our contents one by one, the same way we bought them.

I have no idea why Bahamians like to go to the furniture store and buy a house ful of furnitures. Who's coing to dinner that cannot sit in plastic chairs until you can save up the money for a full set.

Off topic. I friend of mine owns a used furniture store on East street. I have watched people from LYFORD CAY come to her shop to hunt for bargains, especially old copper pots and other curios. She has a heavy turnover in furniture as Hatians and Jamicans buy her out in just 2-3 weeks. So it is back to South Florida for another trailer load. We, Bahamians however, have to buy new!! We want everyone to see the furiture truck pullin up to our house.

Back to insurance. We have a new car and a relatively old one. Both are paid for. We keep them in 3rd party. The price for 3rd party is another rip off.

With the price of home/hurricane,health and car insurances, groceries, gas, utilities and other NECESSITIES how can we be berated for not saving enough?

We make a good living but you should hear us cussing in the food stores as we watch prices go up weekly. By the time you buy the needs, milk, meats and fruits, there is barely enough to buy wants.

Believe it or not, traffic jams causes us to buy even more food. How, you ask. Think about it!! Imagine geting off at a certain time. In the real world as small as Nassau is, you should be home in about 30 minute max. Uh, uh, you get stuck in traffic for hours. You then decide you are to tired or frustrated to get home and cook that meat you took out and seasoned before you went to work. What do you do? You end up spending more on food by stopping to a 'fast food' joint. Thats another bit of your savings GONE. All because of traffic.

I can go on and on. Rant over for now. I stopped judging grown folks for not saving their money when I became one.

I too must say that this is a very interesting topic.

One thing for sure is that you dont want to go into retirement and still have large overheads, example: mortgage, kids in school, or just entering college, other loan debts.

If you can, relocate to an out island. The life is easier, less stress and not as much needs.

Dont go into retirement depending on the little National Insurance income and or whatever your current job give you then.

Try to find a suitable pension/retirement saving plan. There are many institutions around offering these plans.

Dont go into retirement and have to depend on children, those s**k*rs will put you in the geriatrics.

Finally, you need to start thinking about it as early as possible and really plan it out properly so that that phase of life dont be fill with misery.

ps. One thing for sure, you must have good health insurance when you retire.

^Close.
FV = 500,000
PV = ?
Int. = 6%
PMT = 0
Yrs = 20
PV = 500,000/1.06^20 = 155,902
You can invest 155,902 now at 6 percent for twenty years or 13,599.30 every year for twenty years. In twenty years when you start withdrawing funds, you can withdraw 36,324 a year for thirty years (if you can still earn at least 6 percent on the remaining balance).

You have adjusted the number which is o.k but you remember that most of you are complaining about the ability to save small amount so I am sure not many of you can find $155,902.00 today to invest.
6% is possible...

Abroad, the forumula is more like 60-70% of your salary. It is very hard to plan for retirement in the bahamas unfortunatly. Hopefully, you can find a job with a good pension plan cuz you know most bahamians dont save for the future. If NHI comes into effect it will be easier in some respects.

This is a mistake to think that you can live on 60-70% of your pre-retirement income even if you live on a family island (cost of living is higher in most cases).
Planning is the same no matter where you are in the world. You must recognize that you are responsible for what happens to you and discipline yourself accordingly in the management of your time and money. Its your time and use of it that will determine how much money you can earn.
Then managing that money determines how confortable a live you will have.

I heard some interesting information coming from Fidelity Bank. Money back mortage and assue savings as well as others.
I'm going to sit with them next week with a view of moving my mortage and finding out what other benefits they have to offer.
Interesting topic.
With the price of lots costing almost as much as the house, one has to be creative to save money here. When the house is finally built, home/hurricane insurance is just to high. I was shocked when an appriser(sp) told me my house was valued $300,000, thats up $50,000 from TWO years ago!! TRUST ME, THEY ON DRUGS!!
It sounds good on paper but when I called to get the insurance premium, my premium went up by $2000. The insurance is due in September, last year we paid $4400. So far, we have not received the usual notice of an increase in premium. That will surely come around August. There is NO WAY I am going to pay over $6000 in insure a house I built for $130,000 8 years ago. I know I can't afford NOT to. Sorry I can't afford to do it either.
We have decided to drop our contents insurance as in order to get any benefit from this insurance one has to increase it every year. The deductable is another rip off. We figure if we have a fire or hurricane which we hope is total damage without anyone getting hurt, we can replace our contents one by one, the same way we bought them.
I have no idea why Bahamians like to go to the furniture store and buy a house ful of furnitures. Who's coing to dinner that cannot sit in plastic chairs until you can save up the money for a full set.
Off topic. I friend of mine owns a used furniture store on East street. I have watched people from LYFORD CAY come to her shop to hunt for bargains, especially old copper pots and other curios. She has a heavy turnover in furniture as Hatians and Jamicans buy her out in just 2-3 weeks. So it is back to South Florida for another trailer load. We, Bahamians however, have to buy new!! We want everyone to see the furiture truck pullin up to our house.
Back to insurance. We have a new car and a relatively old one. Both are paid for. We keep them in 3rd party. The price for 3rd party is another rip off.
With the price of home/hurricane,health and car insurances, groceries, gas, utilities and other NECESSITIES how can we be berated for not saving enough?
We make a good living but you should hear us cussing in the food stores as we watch prices go up weekly. By the time you buy the needs, milk, meats and fruits, there is barely enough to buy wants.
Believe it or not, traffic jams causes us to buy even more food. How, you ask. Think about it!! Imagine geting off at a certain time. In the real world as small as Nassau is, you should be home in about 30 minute max. Uh, uh, you get stuck in traffic for hours. You then decide you are to tired or frustrated to get home and cook that meat you took out and seasoned before you went to work. What do you do? You end up spending more on food by stopping to a 'fast food' joint. Thats another bit of your savings GONE. All because of traffic.
I can go on and on. Rant over for now. I stopped judging grown folks for not saving their money when I became one.

You are making a mistake not insuring your home and content for "Full Replacement Values" It is easy to quival about premiums now but its a small price to pay for the peace of mind you'd have should something happen. You should not forget the folks in Grand Bahama...and with global condition changing it's only a matter of time before New Providence is affected.
Remember to remove the land cost from the appraisal as you don't need to insure the land...