The number will vary from doctor to doctor depending on a wide variety of circumstances, but that shouldn’t stop us from making an estimate.
VARIATIONS: How much money does a doctor need to retire?
Truth be told, the number doesn’t really vary by profession alone. A doctor has no inherently different retirement needs than anyone else.
At the same time, it’s hard not to notice the fact that most doctors and other high-income people tend to spend more money than the average person and will therefore need more money to retire.
Variables that really matter include current lifestyle, which influences your desired or anticipated spending in retirement, anticipated length of retirement, time to retirement, risk tolerance, ability or willingness to earn an income. future and passive income streams, including pensions and social security.
Tips for determining how much you need to retire
How is your life today? What amenities have become common? How much do you spend in a year? Are you determined to maintain your current lifestyle indefinitely or do you hope that some current expenses will disappear?
A good starting point is to keep track of your expenses. It is difficult to reach a target number if you have no idea how much money is leaving your home each year.
Determine your anticipated retirement spending needs
Once you’ve determined how much your household is currently spending and what expenses you could live on if necessary. You can estimate what your future spending needs might be.
Keep in mind that other costs can increase during retirement, including travel costs, gifts, your education and that of your family. And maybe gifts as your kids have kids or you choose to be more charitable.
Most doctors want to live a similar lifestyle in retirement to the life they are used to living while working. If you fall into that field, you can probably take all of your current expenses and cross out a few that (hopefully) won’t be there in retirement.
Some of the big expenses that will likely or should go away for retirement are:
- Mortgage
- Student loan payments
- Childcare expenses (including school tuition payments).
- Disability Insurance Premiums: You no longer need to protect income if you are retired. This could amount to more than $ 1,000 / month for some doctors.
The rule of 25
The simplest retirement rule ever found is the rule of 25. Take your annual spending number that you estimated earlier and multiply it by 25. As a doctor, that’s what you probably need to achieve financial independence and potentially retire.
This, of course, does not guarantee that your money will last forever. However, if you run a lot of simulations, most of the time the money will last longer than it will. If you retire in your 30s or 40s, you may want more than 25 times your annual spending to play it safe. However, in your 50s or 60s, you are probably in good shape.
There are many ways to reach the final destination. Saving for retirement is like riding a bike across the country.
* There are many routes and strategies you can follow to make the trip. Regardless of the strategy, you need to plan and strategize to ensure a successful trip.
RETIREMENT IN MEXICO
The pension system had a modification for this 2021 and now you can have a minimum pension. Now with only 750 weeks of contributions and you can retire at 13 working years with a pension of at least 3,696.9 pesos.
After the reform to the pension system that came into force as of January 1, 2021, it is already possible that with 60 years of age and 750 weeks of contributions they can process their pension, in accordance with the Law of the IMSS 1997. Previously, a minimum of 1250 weeks of contributions were required and the retirement age started from 60 years.
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