Jump to content

Click the Links to Support our Sponsors >>  Thai Friendly | ThaiMatch.com 100% Free Thai DatingLuxury Pattaya Nightly Condo Rentals | Le Pub Soi Diamond | Pattaya InvestigationsBabydolls Agogo | Agoda Users PLEASE READ  | Pattaya News | Pattaya Bars | Agoda Hotels | Donating to the Forum | Add your Text or Event here

fickle

Inflation

Recommended Posts

fickle

Guys, I'm doing some sums for my retirement, but the biggest headfuck is inflation. I'm 50 and am planning for 30 years retirement. Now I know I know when I was 20 (30 years ago) I could easily live on £500 per month. Today that figure would be £2000 per month. So in 30 years it's gone up by 400%  forget the RPI etc, what is a realistic figure to use when calculating inflation. I was hoping no more than 2.5%, but something tells me in reality it's closer to 4%

Share this post


Link to post
Share on other sites
Colin back in Pattaya

I think 3% to 4% MIGHT be reasonable, but who knows.

There's also the currency risk. Then I moved here in 2005, there were 75 baht to the pound, now the rate is just over 40. That said, I'd still rather be in Thailand than the UK.

Share this post


Link to post
Share on other sites
fforest
Posted (edited)

Well when minimum wage hits 1000 baht a day I think you will have to totally rework your figures.....Look up Thailand escaping the middle income trap...aka.. (Thailand 4.0)......In a nut shell they want Thailand to become a expensive place kind of like Singapore.....The average worker will become poorer than ever even with a higher minimum wage....But expats on a pension will really be taking a hit...All the tax raising that they have been doing and have planned for the 20 year plan fits nicely with this....

 

 

.

Edited by fforest

Share this post


Link to post
Share on other sites
Evilfriar
2 hours ago, fforest said:

Well when minimum wage hits 1000 baht a day I think you will have to totally rework your figures.....Look up Thailand escaping the middle income trap...aka.. (Thailand 4.0)......In a nut shell they want Thailand to become a expensive place kind of like Singapore.....The average worker will become poorer than ever even with a higher minimum wage....But expats on a pension will really be taking a hit...All the tax raising that they have been doing and have planned for the 20 year plan fits nicely with this....

 

 

.

You really think that's going to happen?

Who is the "they" you refer to?

Cheers

Share this post


Link to post
Share on other sites
Evilfriar
3 hours ago, Colin back in Pattaya said:

I think 3% to 4% MIGHT be reasonable, but who knows.

There's also the currency risk. Then I moved here in 2005, there were 75 baht to the pound, now the rate is just over 40. That said, I'd still rather be in Thailand than the UK.

That 75 baht to the dollar was an aboration, the average over the last 20 years was maybe 50 to 55?  You'd know better than me.

Same as the Aussie dollar hit 32 baht for a glorious year, it was way above the norm. Normal was more like 26. But everyone keeps banging on about how they got 32 and why can't they get that now and the sky is falling.

Cheers

Share this post


Link to post
Share on other sites
fforest
Posted (edited)
40 minutes ago, Evilfriar said:

You really think that's going to happen?

Who is the "they" you refer to?

Cheers

Its already happening.....Thailand 4.0 is in the news constantly....

The puppet masters (at least in their mind)

Edited by fforest

Share this post


Link to post
Share on other sites
chippysam

   On You Tube Thailand Eastern Econmic Corridor, if it all comes to fruition . Pattaya could end up part of a first world country with all the expense that goes with living in one . Not sure if I have loaded it right .

Thailand’s Eastern Economic Corridor (English version).webloc

Share this post


Link to post
Share on other sites
fforest
3 minutes ago, chippysam said:

   On You Tube Thailand Eastern Econmic Corridor, if it all comes to fruition . Pattaya could end up part of a first world country with all the expense that goes with living in one . Not sure if I have loaded it right .

Thailand’s Eastern Economic Corridor (English version).webloc

Yea the EEC is the flagship development of the master plan for Thailand...Things are not going all that great for their plans right now but it is still moving forward......Its not a sure thing but they are very tenacious so we will see...

Share this post


Link to post
Share on other sites
davidge

Not sure how the entire plan is going. Certainly not keeping to initial announced dates and may be changes depending on the next week or so.

 

Share this post


Link to post
Share on other sites
davidge
6 hours ago, fickle said:

Guys, I'm doing some sums for my retirement, but the biggest headfuck is inflation. I'm 50 and am planning for 30 years retirement. Now I know I know when I was 20 (30 years ago) I could easily live on £500 per month. Today that figure would be £2000 per month. So in 30 years it's gone up by 400%  forget the RPI etc, what is a realistic figure to use when calculating inflation. I was hoping no more than 2.5%, but something tells me in reality it's closer to 4%

The average inflation rate in Thailand between 1977 and 2019 was 4.11%.

Guess that would be a sensible figure to base your calculations on.

(Source: TradingEconomics.com)

Share this post


Link to post
Share on other sites
Evilfriar

I'm not seeing anything to worry about with this Thailand 4.0.

At the end of the day, the wealthy Thai ruling class in Bangkok are going to keep doing what they've always done. Keep the peasants poor and uneducated.

Cheers

Share this post


Link to post
Share on other sites
gentleman.jack.darby
11 hours ago, fickle said:

Guys, I'm doing some sums for my retirement, but the biggest headfuck is inflation. I'm 50 and am planning for 30 years retirement. Now I know I know when I was 20 (30 years ago) I could easily live on £500 per month. Today that figure would be £2000 per month. So in 30 years it's gone up by 400%  forget the RPI etc, what is a realistic figure to use when calculating inflation. I was hoping no more than 2.5%, but something tells me in reality it's closer to 4%

I think a long-term AVERAGE of 4% is reasonable and that's what I'm using in my calculations, but I've been around long enough to remember the high inflation of the '70s all the way through the almost non-existent inflation of a few years back. My point is that it won't be a constant but one has the advantage of the flexibility to make adjustments in spending or investing when the inflation rate changes significantly.

Although your flag indicates you're from the U.K. and likely the following specifics won't apply directly to you, the concepts apply to anyone anywhere, so I hope they help.

One other thing to keep in mind is that inflation is different for different groups of people. For example, I'm an American and in the U.S. there are different measures of inflation such as the CPI-W (for Urban Wage Earners and Clerical Workers) and the experimental CPI-E (for a household in which the reference person is at least age 62, or elderly). The CPI-E has been higher than the CPI-W over about the last 30 years because, on average over that period, the elderly spent roughly twice as much on medical care than did a household in the CPI-W group and medical costs have increased significantly more than general inflation during that period.

As well, seniors spend a higher percentage of their household income on shelter, so if one owns their shelter as opposed to paying rent, one is that much better off although, in my specific situation and what I want in retirement, housing is one of the things that makes retiring to SE Asia appealing. Although I own my own home, for what I pay in property taxes, property insurance, utilities, repairs, etc. I could downsize to a nice condo in Thailand, enjoy the flexibility that renting gives, and have money left over.

Also keep in mind that inflation's effect will have a different impact depending on HOW one is funding retirement; for example, someone who has no savings and investing whatsoever and is relying solely on a pension, whether it be U.S. Social Security Retirement alone or possibly with another pension, is in a much worse position, especially when considering inflation, than someone who has savings and investments. In the U.S., although Social Security gives an annual cost-of-living-allowance (COLA), that COLA is not based on the CPI-E, so those relying on it are 'behind the 8-ball' from the start since the CPI-E is the most appropriate measure of the living costs for elderly folks. And if one is fortunate enough to have a private pension, that pension may not have a guaranteed COLA at all or the COLA may be capped and likely tied to the CPI-W rather than the more appropriate CPI-E

If one has savings and investments, the picture is brighter since that money can be invested in assets that, without too much risk, will likely keep close pace with inflation. In the U.S., investment funds called 'target date funds', which invest in a mix of assets with a focus on less risk as the target date (for example, retirement or funding a child's college costs) approaches can be appropriate for some people even after retirement. With longer life spans and thus longer retirements the new normal, one must almost certainly have some of their nest egg in equities even after retirement.

 

Share this post


Link to post
Share on other sites
davidge

Thailand inflation:

2CD94B36-A701-4AC5-A7A9-3C206BBA554E.png

Unlike the US mentioned above, UK State Pension has a triple-lock. Each year it goes up by whichever is highest out of wage growth, inflation and 2.5%. It really has to be removed at some point but no Chancellor wants to be the one to remove it.

Of course, if you move to Thailand, or most other countries, it is fixed at the amount you are on when you leave (or first claim it).

 

Share this post


Link to post
Share on other sites
Banana Boi
Posted (edited)

Whatever you think you need to retire in Pattaya, double that amount! 

Thailand economy is on the upswing compared to other countries. 

Pattaya is also priced as a tourist destination. Look no further than taxi and restaurant prices.  On the good side rental property prices have decreased over the past few years due to very high availability. 

Edited by Banana Boi

Share this post


Link to post
Share on other sites
Evilfriar
2 hours ago, Banana Boi said:

Whatever you think you need to retire in Pattaya, double that amount! 

Thailand economy is on the upswing compared to other countries. 

Pattaya is also priced as a tourist destination. Look no further than taxi and restaurant prices.  On the good side rental property prices have decreased over the past few years due to very high availability. 

I'd have to agree, in theory 60 to 80K baht a month would seem to be plenty, but not in Pattaya. In Udon or somewhere like that, it would be plenty.

The OP doesn't actually specify where he would be thinking of locating, that would have a big bearing on what he'd require.

Cheers

Share this post


Link to post
Share on other sites
NorCalKid
2 hours ago, Evilfriar said:

I'd have to agree, in theory 60 to 80K baht a month would seem to be plenty, but not in Pattaya. In Udon or somewhere like that, it would be plenty.

The OP doesn't actually specify where he would be thinking of locating, that would have a big bearing on what he'd require.

Cheers

Just comes down to lifestyle choices.  Pattaya is still very affordable for a guy just living a normal life.  It's the bars and girls that are expensive.  But a guy in Pattaya shagging one lady a week (call it 5k a month on ladies) without a BF can live a very comfortable life in Pattaya for way cheaper than home.  And likely be banging 52 more ladies a year than at home.  Or a guy can live in Issan building houses and loose everything.  

My advice, budget for home country.  If you can afford to retire at home then Pattaya should be a breeze.  If you ever have to move home you can.  

Share this post


Link to post
Share on other sites
johns game
On 17/03/2019 at 18:59, NorCalKid said:

Just comes down to lifestyle choices.  Pattaya is still very affordable for a guy just living a normal life.  It's the bars and girls that are expensive.  But a guy in Pattaya shagging one lady a week (call it 5k a month on ladies) without a BF can live a very comfortable life in Pattaya for way cheaper than home.  And likely be banging 52 more ladies a year than at home.  Or a guy can live in Issan building houses and loose everything.  

My advice, budget for home country.  If you can afford to retire at home then Pattaya should be a breeze.  If you ever have to move home you can.  

A normal life, so a couple rounds of golf a week and drinks after with the lads.

A decent house,car and maybe a motorcycle, good school for the kids.

Dining out with the wife or girlfriend on her days off and holidays to visit parents and friends in home countries. Sounds normal to me.

Or do you mean living in a one room hovel living off 40 baht rice dishes eaten at roadside shacks on plastic furniture?

Visas, health considerations, ( especially if a social life will revolve around prostitutes ) and keeping a place back home if things go tits up, costs big.

I suppose it comes down to what is considered a normal life.

Share this post


Link to post
Share on other sites
fforest
On 17/03/2019 at 16:28, Evilfriar said:

I'd have to agree, in theory 60 to 80K baht a month would seem to be plenty, but not in Pattaya. In Udon or somewhere like that, it would be plenty.

The OP doesn't actually specify where he would be thinking of locating, that would have a big bearing on what he'd require.

Cheers

Are you F...ing joking 60-80k is not enough in Pattaya?.....lol......Just rent a modest apartment, stay out of the gogo bars , pass on the Steak and lobster and you will live like a king on 60-80k in Pattaya.... 

Edited by fforest

Share this post


Link to post
Share on other sites
Evilfriar
1 hour ago, fforest said:

Are you F...ing joking 60-80k is not enough in Pattaya?.....lol......Just rent a modest apartment, stay out of the gogo bars , pass on the Steak and lobster and you will live like a king on 60-80k in Pattaya.... 

No, I'm not joking, my idea of living like a king differs from yours is all. My idea of living like a king isn't getting a Coconut Bar Fl'er every few days and eating from food carts.

That to me is existing, not living like a king.

I like steak and lobster now and again and I like going to a Gogo if I feel like it, living like a king isn't denying yourself those pleasures. 

I'm sure if all I wanted to do was sit in a condo all day and night that 80k would be plenty. Hell I could do that on 30k a month.

I might be 60, but 3 or 4 girls a week would be a  minimum at an average cost of say 1.5k adds up to 20 to 25K a month alone.

Add 15k for decent townhouse (we don't all want to rent a 5k fan room condo in shitsville) plus internet, cable TV etc etc.

 Golf would easily add 20k to my monthly spend.

I enjoy the odd beverage now and then and don't enjoy drinking alone so would expect my monthly drinking bill to be at least 15K.

I want to be able to hop over to PP, Manilla or where ever I feel like when I feel like it.

Laugh all you like, but for me the point of locating to somewhere like Pattaya is that I can enjoy a lifestyle much better than I could at home, why else move in the first place?

Cheers

 

Share this post


Link to post
Share on other sites
whitespider
On 16/03/2019 at 16:13, fforest said:

Well when minimum wage hits 1000 baht a day I think you will have to totally rework your figures.....Look up Thailand escaping the middle income trap...aka.. (Thailand 4.0)......In a nut shell they want Thailand to become a expensive place kind of like Singapore.....The average worker will become poorer than ever even with a higher minimum wage....But expats on a pension will really be taking a hit...All the tax raising that they have been doing and have planned for the 20 year plan fits nicely with this....

I really don't know mate

ONE party is saying it will increase minimum wage to 400 Baht - the others are all saying "no chance its a populist policy". I would guess it will take at least 20 years for the minimum wage to hit 1000 a day - BUT i do accept that fewer and fewer people are actually on the minimum. Yes, many already get close to 1000 a day but those are salaries the companies CHOOSE to pay not an enforced "minimum".

Food prices have hardly moved in 3 years

Petrol is cheaper now than it was in 2009 (yes i know thats due to the strong baht)

I have been here 31 years and although i am no economist i can say quite categorically that the average Thais standard of living is HUGELY improved over 30, 20 even 10 years.

Share this post


Link to post
Share on other sites
NorCalKid
20 hours ago, johns game said:

A normal life, so a couple rounds of golf a week and drinks after with the lads.

A decent house,car and maybe a motorcycle, good school for the kids.

Dining out with the wife or girlfriend on her days off and holidays to visit parents and friends in home countries. Sounds normal to me.

Or do you mean living in a one room hovel living off 40 baht rice dishes eaten at roadside shacks on plastic furniture?

Visas, health considerations, ( especially if a social life will revolve around prostitutes ) and keeping a place back home if things go tits up, costs big.

I suppose it comes down to what is considered a normal life.

Guess it just depends what your version of a normal life is.  I don't consider supporting a family of 4 and putting kids through international schools a normal retirement expense.  Nor do I need 8-10 rounds of gold a week and feel the need for a drinking session to accompany them.  2-3 rounds a month + once a week at the range was about what I did in the West.  

I know guys with nice houses on the light side in the 12k a month range.  

Went with a friend to get health ins quote last summer.  Best policy was half the price of my policy at home and he's 15 years older than me. (my policy in the West had a 180k/year  baht copay and was over 12k baht a month)

Yep,  all about choices and living within your means.  Certainly easier for someone who has been living a modest life in the West than someone used to spending every penny in the West.  Location isn't guna change who you are. 

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

×

Important Information

By using this site, you agree to our Terms of Use.