Starting to save for retirement at 55

[Wales4rugbyWC23]

Hello All, I've purchased the Retire Japan e-book, and my main takeaway is to use iDeCo to reduce taxable income and keep the investment in cash. I've lived in Japan for 9 years, am a permanent resident, and self-employed. Until last year, I was earning below the annual spouse limit. My husband, a company employee, is Japanese. Due to previous business losses and debt repayment from my home country, we weren't able to focus on retirement until recently. Due to living out of Japan for 20 years, my husband has also only been enrolled in the Japanese pension system for 9 years since his return and a few years before he initially left Japan to work abroad, so we are not going to be getting much of anything from his pension. We now have about 10 million yen in savings, and I'm ready to contribute the maximum allowed as a category 1 iDeCo participant to boost our savings. Obviously, we will have to continue working for as long as we are able I have not applied for iDeco yet, but would like to get going in the next couple of days. Should have done this at the start of the year to reduce my taxes, but no point beating myself up or procrastinating any further Any advice would be greatly appreciated.

Where did you Husband work abroad? Was he paying in to a National Pension Scheme there? Can he continue to contribute to a National Pension Scheme there? (e.g. UK...)?

Where are you from? Were you paying in to a National Pension Scheme there? Can you continue to contribute to a National Pension Scheme there? (e.g. UK...)?

Unfortunately, every country is quite specific, so without knowing the countries concerned, it is difficult to point you in the right direction.

Japan has Pension Totalization agreements with many countries

https://www.nenkin.go.jp/international/ ... dance.html

https://www.nenkin.go.jp/international/ ... nisms.html

https://www.nenkin.go.jp/international/ ... ons01.html

The Pension Totalization agreement with the UK is very limited - think non-existant - but other countries are much better.
But if you have status in the UK, you could apply to pay Back-Contributions at very reasonable rates.
Other countries, you would have to ask the National Pension Office or Super Annuation Office or CPP Office, etc...

No totalisation agreements between the UK and Japan is great we can get to state backed pensions at the same time.

[Moneymatters]

Mindless* curiosity on my part.

It seems you can START receiving an annuity distribution from iDeCo as late as age 75.
and then spread it between 5-20 years.
https://dc.rakuten-sec.co.jp/about/recipient/

The question that I'm struggling to find an answer for is...
Does your investment balance continue to remain invested during this withdrawal (annuity distribution/pension period)?
Or is it all effectively just sold and realized at the start of the pension period and just paid out in installments..

* I'm overly blessed in this department.. I recently caught a cold then spent a whole day wondering what happens if an astronaut got sick.
A few of my sneezes would have resulted in aborted space walks for sure..

一度iDeCoを受け取ってしまうと掛金を拠出できなくなりますが、60歳を過ぎても積み立てを継続する場合は65歳まで掛金の拠出が可能です。また、運用自体は75歳まで継続できます。

iDeCoの受取可能年齢 60歳から
iDeCoの掛金拠出可能年齢 65歳まで
iDeCoの運用可能年齢 75歳まで

Once you receive the iDeCo, you can no longer contribute to it, but if you wish to continue accumulating it after age 60, you can contribute to it until age 65. In addition, the investment itself can be continued until the age of 75.

Age at which iDeCo funds can be received: from age 60
Age at which iDeCo contributions can be made: Up to age 65
Age at which iDeCo investments can be made: Up to age 75

https://www.smbc.co.jp/kojin/money-viva/ideco/0017/

Sorry. I’m being that guy again. But I don’t think that answers my specific question. Can the remaining balance remain invested and grow (or even lose value) whilst you are in the process of receiving your ideco as a pension.

[RetireJapan]

Sorry. I’m being that guy again. But I don’t think that answers my specific question. Can the remaining balance remain invested and grow (or even lose value) whilst you are in the process of receiving your ideco as a pension.

I'm not 100% sure myself, but this Mizuho explanation might imply that the funds will remain invested: さらに、iDeCoからの年金受取が終わるまでは口座管理手数料や給付手数料がかかります

From: https://www.mizuhobank.co.jp/academy/20 ... index.html

[Tsumitate Wrestler]

Sorry. I’m being that guy again. But I don’t think that answers my specific question. Can the remaining balance remain invested and grow (or even lose value) whilst you are in the process of receiving your ideco as a pension.

I am going to be that guy to, and say it is a pretty clear no from what I see written there.

Sorry. I’m being that guy again. But I don’t think that answers my specific question. Can the remaining balance remain invested and grow (or even lose value) whilst you are in the process of receiving your ideco as a pension.

I'm not 100% sure myself, but this Mizuho explanation might imply that the funds will remain invested: さらに、iDeCoからの年金受取が終わるまでは口座管理手数料や給付手数料がかかります

From: https://www.mizuhobank.co.jp/academy/20 ... index.html

The fees are levied regardless when a pension option is chosen. May financial websites warn you to carefully plan our your lumpsum/pension options to make sure you will not bear the burden of unnecessary fees. I do not see this as evidence towards funds being still invested.

[RetireJapan]

The fees are levied regardless when a pension option is chosen. May financial websites warn you to carefully plan our your lumpsum/pension options to make sure you will not bear the burden of unnecessary fees. I do not see this as evidence towards funds being still invested.

Yeah, logically speaking (?) you couldn't really calculate the monthly value of the pension option (lump sum divided by number of months) without cashing out the investments.

It seems the only reason to choose pension income would be to save on taxes.

If your lump sum is large enough to be taxable after the 退職金控除, then taking some of it as a pension (provided your other nenkin is not too high and taking the remaining iDeCo fees into account) might save you some money on taxes.

Personally that sounds like a bit of a hassle though. I'm inclined to just take the lump sum and reinvest it either in NISA or a taxable account.

[Tsumitate Wrestler]

The fees are levied regardless when a pension option is chosen. May financial websites warn you to carefully plan our your lumpsum/pension options to make sure you will not bear the burden of unnecessary fees. I do not see this as evidence towards funds being still invested.

Yeah, logically speaking (?) you couldn't really calculate the monthly value of the pension option (lump sum divided by number of months) without cashing out the investments.

It seems the only reason to choose pension income would be to save on taxes.

If your lump sum is large enough to be taxable after the 退職金控除, then taking some of it as a pension (provided your other nenkin is not too high and taking the remaining iDeCo fees into account) might save you some money on taxes.

Personally that sounds like a bit of a hassle though. I'm inclined to just take the lump sum and reinvest it either in NISA or a taxable account.

If things go well my iDeco will be substantial 68,000x12x40+(4% a year )

The pension/lump sum options will probably make sense if my Nisa is maxed.

I'll only get base nenkin, so it won't hurt to have predictable income.

[latebloomer]

Hello All, I've purchased the Retire Japan e-book, and my main takeaway is to use iDeCo to reduce taxable income and keep the investment in cash. I've lived in Japan for 9 years, am a permanent resident, and self-employed. Until last year, I was earning below the annual spouse limit. My husband, a company employee, is Japanese. Due to previous business losses and debt repayment from my home country, we weren't able to focus on retirement until recently. Due to living out of Japan for 20 years, my husband has also only been enrolled in the Japanese pension system for 9 years since his return and a few years before he initially left Japan to work abroad, so we are not going to be getting much of anything from his pension. We now have about 10 million yen in savings, and I'm ready to contribute the maximum allowed as a category 1 iDeCo participant to boost our savings. Obviously, we will have to continue working for as long as we are able I have not applied for iDeco yet, but would like to get going in the next couple of days. Should have done this at the start of the year to reduce my taxes, but no point beating myself up or procrastinating any further Any advice would be greatly appreciated.

Where did you Husband work abroad? Was he paying in to a National Pension Scheme there? Can he continue to contribute to a National Pension Scheme there? (e.g. UK...)?

Where are you from? Were you paying in to a National Pension Scheme there? Can you continue to contribute to a National Pension Scheme there? (e.g. UK...)?

Unfortunately, every country is quite specific, so without knowing the countries concerned, it is difficult to point you in the right direction.

Japan has Pension Totalization agreements with many countries

https://www.nenkin.go.jp/international/ ... dance.html

https://www.nenkin.go.jp/international/ ... nisms.html

https://www.nenkin.go.jp/international/ ... ons01.html

The Pension Totalization agreement with the UK is very limited - think non-existant - but other countries are much better.
But if you have status in the UK, you could apply to pay Back-Contributions at very reasonable rates.
Other countries, you would have to ask the National Pension Office or Super Annuation Office or CPP Office, etc...

Thank you for your response. I am South African and do not qualify (have to be resident) for an old age pension, which is in any case a negligible amount. We both worked for private restaurants for many years which did not have any retirement benefits. So nothing will be coming from that source.(my husband lived and worked in South Africa)