Retirement Planning in UAE

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Retirement Planning - Financial Advisor in Dubai

Retirement Planning 

Imagine how would life be if you live more than 100 years?

Is it possible?

Well, it appears to be!

According to Professor Stuart Kim of Stanford University, The first person to live up to 200 years has already been born! – Source

Global life expectancy is rapidly increasing.

“It has increased by more than six years between 2000 and 2019 – from 66.8 years in 2000 to 73.4 years in 2019.” – https://www.who.int/.  

Global Life Expectancy - Retirement Planning in UAE

On the other hand, the concept of a stable job is fading slowly but steadily, and the Gig economy is fast emerging. The recent COVID-19 crisis and the rapid technological innovations have totally disrupted the future of the economy and employment.

Having said that, there has been very little change in the way people approach their retirement savings.

You are on your own…

If you are a UAE national working in either in government or private sectors you are eligible for pensions and other retirement benefits. However, the retirement corpus accumulated may not be enough to fund your retirement lifestyle, so you will have to save and invest in a private pension plan or retirement plan. 

Very few companies provide retirement benefits to Expats. While it is mandatory to provide a gratuity for expats, it is usually not enough to fund a comfortable retirement. 

So if you are an expat, so you are on your own when it comes to Retirement Planning in the UAE.  Typically there is also the uncertainty of how long you can live and work here, so it isn’t easy to make a viable long-term investment plan for your retirement!

Considering the above challenges, our objective is to provide new age retirement solutions blend with passive income strategies, ideal for a UAE resident like you.

Depending on your retirement income goals, risk appetite, potential cash-flows, and retirement timelines, I can help you design the best pension plan or an investment plan for retirement. 

FAQ - Frequently Asked Questions

Frequently Asked Questions

1. What is the ideal age for retirement?

Typically UAE residents aim to retire between ages 55-60, but nowadays they are hoping to become financially independent much earlier. Given the stressful work environments, people are burning out faster so the concept of FIRE – Financial Independence & Early Retirement is catching up among UAE residents rapidly.

2. At what age should I begin Retirement Planning?

Ideally, you should start planning for your retirement as soon as you start earning. However, it is important to create at least 3 months of emergency savings, before any investment is made. 

The sooner you start investing for your retirement, the easier it would be. As it would help you benefit from the power of compounding. 

“Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.” – Albert Einstein

When you start early, you can also focus on other important financial goals like Children’s higher education, property investment, etc. Otherwise, you could be in a Chicken or Egg dilemma to prioritize your retirement or children’s higher education.

Retirement Planning in Dubai - Chicken or Egg Dilemma-2

Both are major financial goals and you cannot compromise on either of them. Hence starting early on your retirement savings makes the achievement of other goals easy. 

3. Is the advice you give personalized to me?

Yes, We don’t follow a one size fits all formula. 

With the help of the GAiM Plan – A comprehensive financial planning, investment advisory, and portfolio management system we provide bespoke advice based on your retirement objectives, current and projected cash flows, inflation, and your attitude to risk.

4. How does retirement planning work?

We begin with understanding where you are with your money now and where you want to be in 5, 10 15 20 years. We also take into account what other goals you would want to achieve in between. ( Children’s higher Education, property investment, seed money for business, etc..)

Then we help you determine your retirement objectives like;

  • When do you want to retire? 

This is the first step of your retirement planning. It helps you determine how long you have to save for your retirement and how long your retirement corpus has to last?

  • Where do you want to retire?

Knowing where you want to retire will help you visualize the lifestyle you would want to maintain. for Eg: if you want to live in a major city like Dubai, Mumbai, London, etc, your cost of living and inflation will be relatively higher

If you want to live outskirts or in a town, you may have to consider access to affordable and quality health care, while the inflation and cost of living could be relatively low. 

  • What income would you need during retirement?

When you know where and when you want to retire, it is easy to estimate how much you would need to spend every month on retirement. 

While it is difficult to exactly predict your retirement lifestyle and expenses, we can make a fair estimate based on the above factors. Also, there is lots of information on the internet to help on this aspect. 

  • What will be the impact of inflation?

Inflation is the most potential but the least understood financial risk. It works against you day and night relentlessly eating away at the purchasing power of your income and savings. Taking into account the impact of inflation helps you build a corpus that lasts throughout your life and also helps you leave a legacy for your loved ones.

 
  • How much you will need to fund your retirement?
With the help of our advanced retirement planning calculator, we can determine your retirement corpus, enough to last throughout your estimated life expectancy and maybe a little more to leave as a legacy.
It will take into account the inflation and the potential rate of return during retirement on the corpus saved.
 
  • Investment Planning 
Next, we will help you with a clear action plan to accumulate and grow the corpus by investing in one or more of the best investment options in the UAE or outside.
 

We will also help you identify and invest in assets yielding passive income to complement your current income from employment, profession, or business.

You will receive a detailed report and recommendation after our financial planning session. 

5. What kind of Retirement Solutions do you provide?

Based on your retirement goals, investment, and risk appetite, we can choose from a wide range of investment solutions like;

  • Best Pension Plans in UAE.
  • Dividend-yielding International Mutual funds, Stocks, and ETFs.
  • Structured products.
  • Best Retirement Plans from leading insurance companies.
  • Passive income yielding REITs.
  • Bond and Bond Funds providing regular coupons.

6. Can I continue the investment after moving out of UAE?

Yes, all plans we recommend are international and you can continue to hold, manage and encash them even after moving out of UAE. We will provide all the necessary support in managing your plans throughout the investment period.

7. How do I know whether I have enough money to retire?

I can help you project your retirement corpus by estimating your retirement expenses, potential inflation, and a conservative growth rate on your investments.

Click here to Arrange a Free Consultation to get a detailed analysis of your retirement cash flow needs.

8. Where can I get more information about your retirement planning services?

Damodhar Mata - Financial Advisor in Dubai
Damodhar Mata - Financial Advisor in Dubai

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