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-   -   Retire in India and live off interest payments? (https://www.indiamike.com/india/india-expat-area-f84/retire-in-india-and-live-off-interest-payments-t20461/)

cyberbaba Jan 27th, 2006 11:12

Retire in India and live off interest payments?
 
how much would YOU need to be comfortable? why?

i'm trying to figure this game out and it seems there are a few variables.

anyone out there doing it?
planning on doing it?
please share :)

i just got back to the west and am about to put my head down and stack the cash up.

:) :) :)

lotus blossom Jan 27th, 2006 11:33

it's my plan, soon to be in action. well, sort of my plan. i don't intend to live in india, but travel in india as well as other third world countries. i figure i can do it comfortably for about ten bucks a day, so will need approx. $300 a month, when i'm not paying for transportation, that is. i'm figuring i can get by on about 5 thousand a year. of course, if i take in more traveling from one country to another in any given year, it will be a bit more than that, but my goal is to stay within that 5k range.

i'm curious, what are the variables that you are working on?

cyberbaba Jan 27th, 2006 11:43

well how-a-bout that!

$300 is what i live on as well. but i'm wondering how to take inflation into account. seems to me that it's currently something like 8% in india? so how to factor that into the equation? math was never my stong point but it seems to me that 100k @ 8% should give $666/ month. which would leave a small amount to leftover for a quick flight out.

but then (people say) there is health care to think about when one gets older.

any thoughts?

lotus blossom Jan 27th, 2006 11:58

i have a hard time wrapping my brain around numbers, so am not sure how you've come up with your figures.

my health care will be figuring in pancha karma treatment yearly, when in india. seasonal cleansing and rejuvenation is the best health insurance. ;)

Anders Jan 27th, 2006 15:09

In addition to inflation you have to think about taxes. If you with "live of interest payments" mean living off interest from bank account or bonds, after inflation and taxes I expect that you will be happy to break even and that is before you taken anything out to actually live on. Your idea is very much possible but google a bit on "early retirement" before telling your boss where he can put the job ;)

TimMakins Jan 27th, 2006 16:23

'Break Even' ??? The single person's tax allowance in England is 4895 per year, or about 168USD per week. Unless I am mistaken, this means that you could earn that much from the interest on the sale of a property without paying taxes, and then use that money to fund your living expenses abroad.

Is this not correct ?

Tim in Ireland

Anders Jan 27th, 2006 17:29

A very nice tax allowance, I will keep that in mind if I need a "residence" when I'm actually on the road :)
But the OP here mentioned retiring in India. I would assume that means that he would be taxed in India on investment income and not in Canada if he follows the rules. There is of course the possibility to not follow the rules and hope that they never find out. Income from real estate could possibly be taxed in the country where it is actually located.
Notice the words "assume", "possibly" etc. The only real way to know where something should be taxed is to read the double taxation agreement between the countries.
I also have no idea what the tax rates are in India on investments.

john.sw Jan 27th, 2006 19:24

I have a foreigners' bank account into which I can pay foreign currency only.

I do not pay any tax on the interest unless I take the money outside India.

I also have a residents' bank account. I can pay rupees only into this account and I am taxed on the interest at the standard rate.

__________________

I could live well off Rs. 1 Lakh a month in India.

In the UK that doesn't even pay my taxes.

Sama Jan 30th, 2006 12:38

In the US we have what's called "Social Security" when one retires. A "pension", so to speak, provided by the government. Different amounts for everyone depending on how much you earned during your working life, how long you worked, etc.

I'm not old enough to retire but if I was I could collect about $800/month. This is not counting investments I have.

Hmmm....retire in India.....doable?:cool:

Nick-H Jan 30th, 2006 13:13

Yes, Yogagal, perfectly doable. In the same ball park as my finances.

Don't expect that you will get luxury lifestyle on that but you'd live well enough.

Nick-H Jan 30th, 2006 13:15

Quote:

Originally Posted by john.sw
I could live well off Rs. 1 Lakh a month in India.

That is three or four times my budgeted income!

Ravibagal Jan 30th, 2006 13:24

Unless you have loads saved up you can forget about it. India will become more and more expensive for backpackers over the next 10 years so it is not possible to make long term plans. Also foreigners are a bit of a novelty here still but the WOW factor from the 80's is gone. You never can know how welcome you will be 5 years from now.

cyberbaba Jan 30th, 2006 14:14

"Unless you have loads saved up you can forget about it."

loads? you mean like millions and millions? beg to differ.

"India will become more and more expensive for backpackers over the next 10 years so it is not possible to make long term plans."

backpackers? who said anything about backpackers?
let's see an nice interest generated income with inflation factored in... perfectly possible.

"Also foreigners are a bit of a novelty here still but the WOW factor from the 80's is gone. You never can know how welcome you will be 5 years from now."

wow factor? sir... are you running a fever? hard cash still speaks volumes, even in the "new india." as far as being well received, nothing like a c-note to put a smile on someones face :)

jai hind!

GoanCanuck Jan 30th, 2006 14:57

You will have to factor in fluctuations/changes in the Dollar---> Rupee conversion rate in addition to the interest available on your principal. You will also have to decide whether you want to keep the entire amount in Canada and make regular withdrawals or maybe keep a part of it in India.

Anders Jan 30th, 2006 15:32

That surprised me so much that I had to go and look for it,
Canada - India tax treaty


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