“This formula grew my portfolio by 1,000 times”

“This dividend stock made me wealthy enough to stop working”

Scrolling through social media feeds, we often see clips or articles promising quick riches from investing, as if there’s a surefire formula for financial heroes. This causes many to worry whether those who aren’t skilled or daring enough can really accumulate a large enough nest egg for retirement. But in fact, retirement saving is a long-term process, and there are many ways to reach your goal without needing expert-level investing skills.

Clarify your retirement planning goals first!

Today, we can still earn money through work, but after retirement, that may change. So, how much money is needed to last throughout our lifetime? Start by asking these four key questions.

1. At what age do you want to retire?

Consider whether you want to retire at age 50, 55, or 60. Then subtract that from your expected lifespan. For example, retiring at 60 with an expected lifespan to 80 means you need to prepare funds to cover expenses for 20 years.

2. What kind of lifestyle do you want after retirement, and how much will it cost?

Lifestyle determines how much money you will need. Calculate monthly expenses including food, travel, utilities, fuel, medical bills, etc. For example, if monthly expenses are 25,000 baht, yearly expenses are 300,000 baht, and for 20 years you will need about 6 million baht. This does not yet include inflation, which experts often recommend adding at 2-3% annually.

3. Make a checklist of all assets and benefits.

Start by listing all your assets: cash, house, car, investment portfolios, life insurance policies, and benefits such as the Provident Fund (PVD), social security pension, and for government officials, the Government Pension Fund (GPF).

4. How much time do you have left to save or invest?

Once you know your target amount and current assets, calculate how much more you need. For example, if you are 45, plan to retire at 60 with a goal of 6 million baht, and currently have 2 million, you need to accumulate an additional 4 million over 15 years. Your investment approach will depend on your risk tolerance.

Retirement savings formula with “PVD-RMF-DCA”

For salaried workers who may not have time to deeply study investments, there are several saving or investing options that don’t require you to manage investments yourself or time the market constantly.

1. Provident Fund (PVD)

Some companies offer PVD for employees to save for retirement. Employees can contribute from 2-15%, and employers add matching contributions depending on company policy—for example, full matching after four years of service. Employee contributions in PVD are tax-deductible under Revenue Department rules, combined with RMF and other schemes. If leaving the company, you can choose to withdraw, transfer to an RMF, or move to a new employer’s PVD.

Note that withdrawing PVD funds after tax deductions may be complicated, requiring notification to tax authorities and possibly incurring penalties.

2. Retirement Mutual Fund (RMF)

RMF allows tax deductions of up to 30% of assessable income, but combined with other retirement savings not exceeding 500,000 baht in a tax year. RMF offers various investment options including Thai equities, bonds, and foreign stocks.

Key conditions include continuous investment with no more than a one-year gap, holding units for at least 5 years, and being at least 55 years old before redemption. Note that RMF conditions may change, so keep updated before investing.

3. Dollar-Cost Averaging (DCA)

Since investment returns may not always be high, regular contributions are necessary to meet goals. DCA—investing a fixed amount monthly consistently—helps average down costs and reduces emotional decision-making because you invest regardless of market price levels.

However, choosing which assets or funds to DCA requires research, such as selecting fundamentally strong stocks or funds matching your risk tolerance to ensure your portfolio progresses as planned.

Although these three methods—PVD, RMF, and DCA—may seem ordinary and accessible to anyone, steadily accumulating funds and generating returns suitable to your risk profile allows you to smoothly reach your retirement goals in harmony with your life’s rhythm.

Sources: SET, Thai Financial Planners Association, KBank

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No Need to Be Stock Market Expert! Secure Retirement Funds Easily with the Ordinary Person’s Formula: “PVD - RMF - DCA”