Become an annuitant with your savings, is it possible?
Saving is what we have left when we have paid all the useful or futile expenses. There are two ways to see things, one thinks I’ll put aside at the end of the month if I have something left or so, I have to put something every month is my priority.
This is the difference between people who want to make money and give themselves the means and the people who wait for it to fall from the sky.
Yes savings is the simplest, easiest way to earn money when you have a source of income, why?
Because if you decide it is an income that you can have every month that will enrich you in a regular and constant way.
If you want to become an annuitant thanks to savings, do not say “I do not earn enough” or “I have too much money I can not do it”.
Just tell yourself I have to save and my standard of living will be accordingly. This is where the automatic transfer occurs.
If at the beginning of the month I admit 10% or 20% of my income that leaves, as is happening with his credit elsewhere, then we have no choice we must live with what remains. Put yourself at the foot of the wall! The sooner you have this step and the less it will be binding.
A young person who goes on this basis with his first salary, will not have in mind to slam all his income and will change his state of mind and how to consume.
Becoming an annuitant by consuming real profits online less and saving more is much easier when you have reached a certain level of comfort:
Society imposes needs of desires: a house, a flat screen, a beautiful car, beautiful trips or a beautiful watch.
When we went around all these desires, it is easy to say I no longer need anything, I can save but what will you miss is the time.
You will be able to make up for this time by saving more money for sure, but to take good habits as soon as possible will change your mentality, and allow you to put into perspective your real needs, to make the difference between your needs and your desires , between the ephemeral effect and the durable.
I’ve always been reasonable, but like many I wondered what I could afford every month, there is still some money left, what could I buy?
Now when I am asked what I want for a birthday or other, I have no idea, my needs are met, not because I am rich but because I have revised my needs.
Why suddenly I talk about myself?
Without going into my budget, I will try to do a little simulation to see if it is possible to become an annuitant thanks to what I spare.
It has been about a year since I started seriously to look at savings, my first motivation was to make a precautionary saving consequent for a rental investment.
Finally, seeing that I was no more unhappy, that we were doing well each month, I continued this process.
We are a family of 4, 2 salaries and not really big salaries, to get an idea we are in the slice 14% of taxes.
In the last year, I have saved about 14% of our income , plus small income from selling used items on the right side, or if there is something left at the end of the month, it starts at savings and more. Our debt ratio is around 30%.
Then on this saving is added 2000 euros of income of our Panels photovoltaic, knowing that we have a credit of the same amount …
In short for a year we have saved 12,000 euros . I am the first surprised of this figure because I had rather targeted on 8000 euros but by putting all end to end one realizes that there is no small profits. Everything is a question of rigor and discipline, as often with money, if I continue well and without counting the interests of the investments made, I would have in 10 years: 120000 euros, in 15 years 180000 euros and in 20 years 240000 euros , as I’m going to celebrate my 40th birthday this year, you will not mind if I stop at 20, the premise of my hypothetical retirement.
Why not count compound interest? because I say to myself that the equivalent of the interests can be regarded as lost, in unforeseen expenses heavy and various, by necessity, voyages, etc …
At the end of all these years of savings, could I become an annuitant?
Yes and no. Everything depends on my needs and the comfort of life that I would like, and this can change, but let’s do some simulations.
In 10 years: By taking medium risk investments such as trackers. We can leave on a yield of 10% / year unsecured but feasible.
That would bring 12000 euros annually and therefore 1000 euros monthly , a little fair to become annuitant without deprive it seems to me.
With a still less risky investment such as SCPI at the current rate it would be 500 euros, it would be more of a salary supplement , let alone with a life insurance fund in euros.
If you think that 10% per year is reserved for stock market insiders, you can also do the simulation with real estate.
You invest the cash in a property that earns you 10% per year, It is but in gross yield, Net is more complicated but we can approach it.
If you are still not convinced, start saving and train on the stock market and in the rental investment.
Maybe you have already done the simulation over 15 years ?
180000 x 10% = 18000 euros per year
is 1500 euros / month with a yield of 10% per year.
Becoming an annuitant can begin to consider because we will have no more credit. But not enough to live comfortably, just live simply and avoid waiting for retirement.
In a country other than France, where the cost of living is much lower, this can be very conceivable even in Europe, as in Portugal for example.
Over 20 years: 2000 euros per month there we can say that it is possible to become an annuitant through savings but you remember when I told you that it was necessary to take good habits very young?
20 years is a long time but for me who started late at the worst I built myself my retirement and I could take it much earlier by finishing the last 10-15 years part time.
In this little simplistic demonstration, I do not take into account the taxes that will have to be deducted from his income, and the rent of which I speak will be possible only for one person in the couple and not the two people, otherwise it is necessary double the sum.
Counting on his savings to generate the income from a pension is long but possible. This time can be reduced if you start now and if you generate other income that will help you speed things up.
Start investing in real estate, train the stock market, create your business and all this will allow you to go faster and catch up with the years of cicada.
Do not live in deprivation if you want to become an annuitant with your savings but simply look at the scale of a life and not a month