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November 16, 2011 / Vanilla Chocolate

An Awesome Retirement Plan.

Okay so I have this crazy idea in my mind where I believe that I have devised for what it seems an Awesome Retirement Plan for an early-early retirement – at age 42 to be precise.

According to plan, at age 42 once I retire I would be having a monthly income of 1,00,000 Rupees enjoying life, running after nothing and in peace. Yes 1,00,000 after retirement!

Here is how it works!!

I am 22 right now and here is what I’ve thought : if on an average for the next 20 years I manage to save up 25,000 Rupess a month that gives me:

300,000 Rupess a year

300,000*20 = 6,000,000 Rupees. 6 Million Rupee huh!!

Now I take that, if all the savings and investments that I do, say I get an appreciation of 10%,  it would give me an additional 6 Million Rupees!! huh??

For those who like math, here’s the calculation: 

  • For my first year I get an interest of 10% on 300,000 It gives me 30,000.                                                                                                
  •  For my second year I get an interest of 10% on 600,000. It gives me 60,000
  •   …..and so on till by the end of 20 years from now I have 6,000,000 Rupees and an interest of 600,000 Rupees.

    So for all you math fanatics reading this, this would be an AP with a D of 30,000.

Sum of a AP = [(first term + last term)/2]*N                            N is the number of terms, in this case its years and N is 20.

so, my sum = [(30000+600000)/2]*20 = [630,000/2]*20 = 6,300,000 (Not Bad huh! an odd 6.3 million Rupees)

So add that to my 6 Million in the bank and i have 12.3 million rupees. Say at this point of my life I want to retire, spend time with family, travel, enjoy my hobbies, I am only 42 right?

With all the money in the bank and investments say I get a 10% appreciation. I get a yearly sum of  1,230,000. I get a monthly amount of more than 1,00,000(Lakh) Rupees. For those of you who are familiar with India, a lakh rupees a month is very doable. A flight ticket from the US to India two way is around: 60,000 Rupees, 1,00,000 a month no bad huh!!?

In terms of dollars to give this an international tinge, you save  500$ every month for the next 20 years, out it in the bank and you can retire in 20 years with a regular income of  2000 Dollar a month, not bad…erm.. save $1000 a month and you get $4000 a month 20 years hence, doing nothing but loving your life, yoga and meditation, with  sports and friends, anything!! You could enjoy for the rest of your life after 40s 😀

Now the only thing I hope is that I remain in tact till im 42 😀

Write in your comments in case you’ve got better schemes or find a flaw in this 🙂

Happy Saving: CHOCOLATE.


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