Topic 8

Question 1

What are the common mistakes in retirement planning

Answer 1

not planning at all
planning too late (investing too little)
earning very little on investments
underestimating effects of inflation

Question 2

What are the methods to determine retirement needs?

Answer 2

replacement ratio method

expense method

Question 3

What are the assumptions in retirement calculation

Answer 3

rate of return
inflation
retirement age
retirement period
retirement needs

Question 4

What is the 4 step process to determine retirement needs?

Answer 4

set retirement goals
determine the level of financial resources available
work out the shortfall
formulate a savings/investment plan to fund the shortfall

Question 5

What are the sources of retirement funding

Answer 5

CPF
SRS
assets (savings, investment, insurance)
Continued employment during retirement