Education Fees Planning your children’s future
Education Fees / Retirement Planning
Jun 10, 2015
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Education Fees Planning your children’s future
Education School Fees Planning
• Average per annum rise in University Fees:
5%-7% per annum (7% for top schools) “The cost of attending public and private universities has consistently
outstripped the rate of inflation.”
“Over the past 5 years, tuition and fees at public institutions rose more
than at any other time in the past 30 years, increasing by 35 percent”.
Source: International Herald Tribune
Costs Break Down Based on a Four Year Bachelors Course
• Fees $100,000 - $140,000
• Add 5% inflation over 15 year period $200,000 - $280,000
• Living costs (board, food, utilities) $60,000
• Add regular RPI inflation of 2.5% $78,000
• Plus– Books– Healthcare– Travel to and from home– Social spending
Grand Total
Retirement Planning Securing your financial future
Retirement; the reality
90% of people that get to retirement age are underinvested. Will this be you?
Who is responsible for ensuring financial freedom in Retirement?
How much will you need to have saved in order to retire comfortably?
Timeline30 yrs 76 yrs
82 yrs
65 yrs
Invest money monthly
Lump sum to draw downOr take an Income
State
Company
Personal
2.5m workers facing cut in gold-plated final salary pensions
Protest as Government pension
deficit increases
Retirement; the reality
Life LineEstablishing your objectives
17 years
€50,000
60 years old43 years old(Retirement age)(Present age)
(Income today)
Life LineEstablishing your objectives
17 years
€50,000
60 years old43 years old(Retirement age)(Present age)
1st child starts university…
Spouse retires…
Mortgage paid off
Buy property abroad…
(Income today)
Life LineEstablishing your objectives
17 years
€50,000
60 years old43 years old(Retirement age)(Present age)
(Income today)
Life LineEstablishing your objectives
17 years
(Income today)
60 years old43 years old(Retirement age)(Present age)
€35,000 p.a.(Target income in
today’s terms)Objective :
Retire on 70% of current income
€50,000
What will this need to be in the future?What will this need to be in the future?
Target income (today’s terms)
xInflation factor
(years to retirement)
= Target income (future terms)
€35,000 x 1.045 = € 48,000
€48,000 p.a.
Life LineThe effect of inflation
€35,000 p.a.(Target income in
today’s terms)
(Target income in future terms)
Life LineThe effect of inflation
17 years
(Income today)
60 years old43 years old(Retirement age)(Present age)
€48,000 p.a.(Target income in
future terms)
€50,000
Life LineEstablishing a target figure
Capital sum required at retirement
x Projected income yield
=Target income (future terms)
How much capital will I need?How much capital will I need?
€48,000 x 5% p.a. = € 960,000
Capital required at 60(from all sources)
€48,000 p.a.(Target income in
future terms)
€960,000
Life LineEstablishing a target figure
Capital sum required at retirement
x Projected income yield
=Target income (future terms)
How much capital will I need?How much capital will I need?
€48,000 x 5% p.a. = € 960,000
Capital required at 60(from all sources)
€960,000
17 years
€50,000(Income today)
60 years old43 years old(Retirement age)(Present age)
Life LineEstablishing a target figure
€960,000Capital required at 60
(from all sources)
17 years
€50,000(Income today)
60 years old43 years old(Retirement age)(Present age)
Life LineEstablishing a target figure
€960,000Capital required at 60
(from all sources)
Existing benefits Frozen schemes
€200,000
17 years
€50,000(Income today)
60 years old43 years old(Retirement age)(Present age)
Life LineEstablishing a target figure
€960,000Capital required at 60
(from all sources)
PENSION GAP€760,000
Additional capital required at age 60
Existing benefits Frozen schemes
€200,000
Life LinePlan of action
Average monthly investment to achieve goal
Projected growth over
17 yearsPension Gap
How much should I be saving?How much should I be saving?
€300,000 10% p.a. €1,000 p.m.
€1,000 p.m.Average monthly
investment required
€760,000Additional capital
required at age 60
Life LineHow much should you be saving?
17 years
€50,000(Income today)
60 years old43 years old(Retirement age)(Present age)
Average monthly investment required
€1,000 p.m.
€760,000Additional capital
required at age 60
Existing benefits Frozen schemes
€200,000
PENSION GAP
Retirement Plan Investment Portfolio
Fixed Income
Global Bond
Euro Fund
US FundBRIC FundEnergy Fund
Retirement InvestmentWork with your advisor to maintain correct risk profile
So how much do you need?
Are you on target to retire when you want to?
Will you retire how you want to? (mortgage paid off, school fees set aside, enough for both spouses, retire early...)
Do you know how your other pensions are performing? (do you have “frozen” pensions?)
Are you doing enough?
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