Financially, how do you plan for retirement when you are in your 30s and 40s and 50s?

Live below your means.

Hi anon,

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Great advice from all the comments thus far. If I were to add some food for thoughts, it's really about determining your desired retirement lifestyle and taking into account a reasonable margin of safety for life changing scenarios.

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If you have the vision of where you'll be during retirement, what you'll do, how you'll do it and everything is laid on a map - that's basically your Rome and any vehicle that you choose, leads there.

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Insurance annutiies and CPF (if applicable to you) may be similar but with a difference in providing liquidity. CPF life scheme is always a moving goal post where the figures for min sum we see today will definitely not be the ones we're expected to meet when the time comes. Hence there is some level of uncertainty in the 'final figure'. Contributing to CPF may not be a good idea if you require (or prefer) liqudiity in your active life.

It's a one way street and you'll only see it upon retirement or giving up your citizenship (which seems unlikely).

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Annuity plans are in the market for a good reason and provide a stable income stream for retirement - beyond that the surrender values provide some immediate liquidity that otherwise will not be possible through the CPF accounts. - If this is a concern, then an annuity plan could be useful (especially so if you're intending to leverage). Not all annuities only pay out at your retirement. Some are designed to pay lifetime income within a short period of taking it up - again it depends on your circumstances and ideal retirement lifestyle to determine whether it's suitable or not.

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Age and investing behaviour - follow the life cycle! take more risk when younger and protect the portfolio when older!

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Happy planning~ :)

30s - Good to accumulate and seek for growth. I would put a majority of investments into Equities to maximise growth.

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40s - Good to consider building up a dividend portfolio for retirement payout

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50s - Consolidate investments into dividend paying stocks and continue adding to the dividend pool. Max out CPF.

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60s - Continue doing the above and start enjoying the CPF and Dividends payouts.

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70s - Review financial portfolio for legacy planning.

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No need for annuities.

For retirement, the earlier the better because time is on your side to compound the returns. hence,

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I wouldn't buy annuity insurance because

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(1) you are losing out the gains that could have materialised by buying stocks and shares first, and derisking when you slowly approach retirement

(2) CPF returns are generally on the higher side than insurance companies (the companies need to make a profit).

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Hence it only makes sense to buy annuity if you have too much money to spare (CPF already hit FRS) and you still need a certain gauranteed income later.