So You Say You Want to Retire by 50?

When work seems never-ending, your boss isn’t happy with your performance, and you’re so stressed out that all your colleagues can see it, you can’t help but imagine that dramatic exit. You know the one, the dream where you storm into your boss’ office, shout “I quit,” and walk out for good. The reason why we leave this scenario to movies and not real life is because half-a-second after thinking about quitting your shitty job, you’re reminded about all the bills you have to pay at the end of the month.

Thinking about retiring? About retiring early and without having to downgrade your lifestyle? In this economy, unless you're some hotshot who've sold your multimillion dollar app to some tech giant, this sounds too far-fetched. But don't dismiss the idea entirely yet.

“Theoretically, it’s possible," said financial planner Prita Ghozie. "Provided that the person has already saved enough money to live until they’re around 70 years old."

In Indonesia, if you’re a civil servant, you can take early retirement if you're at least 45 years old and have served for 20 years or more. At this point, you have the right to government’s social security.

Meanwhile, an employee at a private company who's enrolled in the government healthcare program (BPJS) can only get their monthly retirement fund at the age of 56. If you want it earlier, you will have to have paid an insurance premium for 15 years. Otherwise, you will have no rights to a monthly retirement fund, and instead only to the accumulated premium plus interest.

But what if BPJS no longer exists by the time we retire? I mean, some people are saying that there won't be Indonesia to speak of by the year 2030, and in this time and age nothing's too bleak to be a possible future.

But worry not—whenever you decide to retire—the important thing here is the math. There are several "saving factors" or factors that you need to pay attention to when you're preparing the minimum amount of money you need to have before retirement, according to Fidelity Investment, a US financial services company. And those factors are your current age, when you want to retire, and what kind of lifestyle you want during your retirement.

For people under 40 years old, the easiest thing to do is to save up and spread your money in diverse investments. If you’re above 40 years old, it might be a bit too late but according to Fidelity Investments, the solution is to do everything you can do legally: save up more, limit your spending, and work longer hours.

Before you try one of these retirement calculators, note that most of them set your life expectancy at 92 or 93 years old. But, Indonesians' life expectancy is 69 years old—let's round this up to 70 for easier calculations—and this might be the only silver lining you're going to hear about the fact that we die younger: it means you have less to save!

So, let’s say you're currently 25 years old. In the calculator, the earliest you can retire is 62. This means that by 30, you need to have saved as much as you made in one year. By 50, you need to have nine times your annual salary. And by 62, 14 times of your annual salary. Assuming you don't leave the company you work for or get promoted, you can imagine how much money you can make a year by taking account the minimum annual salary raise of 8.71 percent. And that’s not to mention inflation.

Saving money is important, but you also need to consider your lifestyle. It's easier to make money last in cheaper places, obviously. A billion dollars will look a lot different in Jakarta, the most expensive city in the country, compared to Yogyakarta or Malang, for example. This is especially important for those who don't make much more than the minimum monthly salary in Jakarta (Rp 3.6 million, or $250 USD), Prita, the financial planner, explained.

“If your salary is Rp 4 million ($286 USD) and your living expenses is Rp 3 million ($214 USD), then you can only invest a small amount of money," Prita told VICE. "It means you can only move to a small town in Java after you are retired."

If all those fancy calculators are too much for you right now, Prita said that the easiest way to plan for your retirement is to set aside at least 10 percent of your income every month. That will get you to a pretty good place to enjoy your retirement debt-free.

Of course, no calculator can accurately prepare you for life's circumstances. Life happens—sometimes there are unexpected expenses that can set you back in your retirement goals. Or maybe you weren't born into a well-off enough family to retire early to begin with. So you want to retire at 50? If you think you can, go ahead. But if not, I'm right here with you.