UnderscoreEX wrote: ↑Wed Mar 01, 2023 4:53 am
I will be 30 years old this year and I am trying to plan for my future, mainly about buying home and retirement.
Personally, I didn’t buy a home in Tokyo until I was married with kids, and around 36 years old.
The pros of that
- with a higher salary at 36, I could afford a better home than when I was younger
- being married to a local native enabled me to get PR which helped getting a mortgage
- my spouse and I were both happy with the home (some spouses I know don’t like the home that their spouse already owned but are stuck with it)
- my spouse could also contribute to the home purchase - a if a double income couple helps there
Your home may lose value by the time you perhaps decide to sell it. I see my home in Tokyo as a consumptive thing. It costs more than when I was renting, but my salary has gone up which he made that bearable.
I think your number one priority should be seeking that higher paying IT job you talk about! That is the best investment I can see for you to make at this stage.
But yes contribute to iDeCo if you can, and then NISA as you can. But don’t sweat it; that you have already started is excellent. Get a higher income first and then do more of the investment stuff later when you have a greater propensity to invest. I started the investment thing when I was around 33 I guess, and had buying a home in mind so did not have the money invested, rather as cash in the bank, not wanting to risk it, given that I was planning to use it. You are not married yet, so different story. But buying a home is a big step, I think. You can do that later, after you have that higher paying IT job, and maybe a spouse too.
If you get a higher paying IT job, your retirement saving target of 10,000,000 would be easy peasy. If you just put away 500,000 of your higher 6 million income a year (that you do not have yet) for 20 years you’d be there. Without even investing.
3) Also, would you recommend putting the 80k a month into index funds or saving for a downpayment?
If you are willing to invest the money for 10 years or more and not use it for a down payment, then yes investing it seems a fine idea to me. But not if you might want to spend the money if a couple of years, and the market might have had a bad year just when you want the money. (Over a 10 year horizon this risk is extremely low.)
Am I on the right path to retire in Japan?
You have found this place at a young age; I think it is a very promising sign!
In our early 30’s, my spouse and I really had no idea about how much we ought think was realistic to buy a home for. We rented in a “nice” suburban area and prices seemed high and out of reach. But my salary increased a lot during my 30’s and in the end the “quite expensive” home we bought has been easily affordable. I don’t know if I have been lucky or if it is standard like this.
My point there is that at a young age you don’t really know how your lot is going to turn out, or how much you will be able to afford. So first, focus on getting that better paying job to make your lot turn out as good as possible (I hear the IT market is good for job seekers now, so it’s a good time to be looking).
(All purely my opinion - even as I write this I ponder whether my thinking on buying a home wasn’t overly cautious, so take it all as one opinion full of self doubt .)
