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Re: 2021 and beyond
Posted: Wed Jun 30, 2021 4:48 am
by Tkydon
Whilst Paternal Leave is a legal right, it is not looked on well by some employers, and you might find yourself restructured shortly after going back to work... That is a risk to take into account.
You should look at a method to save for your child's education, whether Junior NISA or other.
In today's Yen for a 4 Year Uni
A Japanese University would cost something between Y3M and Y5M
A Private Uni or Overseas Uni could cost anything from Y10M
You would have to include accommodation if away from home, maybe Y4M
In 20 years, you could expect that to be double.
Therefore you should aim at an Education Fund of somewhere between 10M and 30M...
If you don't have enough in 20 years, you would either have to pay out of pocket or rely on Student Loans.
As some of my friends who have had kids later in life are just discovering, this can be a significant road-block to scupper your retirement plans...
Re: 2021 and beyond
Posted: Wed Jun 30, 2021 5:22 am
by RetireJapan
Tkydon wrote: ↑Wed Jun 30, 2021 4:48 am
If you don't have enough in 20 years, you would either have to pay out of pocket or rely on Student Loans.
As some of my friends who have had kids later in life are just discovering, this can be a significant road-block to scupper your retirement plans...
I'm a big fan of student loans. My stepdaughters all took them out to pay tuition (they just about covered tuition at a private university) and lived at home. You would probably need to find more money if they were going to live away from home.
The nice thing about student loans is that it makes the cost (and investment) more real to the student than it might be if their parents just pay for it. You can always choose to help them pay it back later if you want to (and can afford it).
Re: 2021 and beyond
Posted: Wed Jun 30, 2021 6:27 am
by Kanto
Things are going really well. He is blossoming in hoikuen. Co-parenting is going really well. Just got a new bike with a baby seat, foreign-sized XL frame, hard to find here.
My Japanese studies have fallen off however.
...
I disagree with the J-Nisa point. I think parents should try their best to ensure their children finish tertiary education debt free.
Re: 2021 and beyond
Posted: Wed Jun 30, 2021 12:56 pm
by Yossarian
Thanks for asking - he's a happy and healthy baby. My wife had a really tough couple of days but she's recovering now. And of course it was difficult not seeing them for a week, although I was there for a few hours on his birthday.
Re parental leave: Think it's one of the best decisions I have ever made. Having lots of fun with my son and it's financially a lot better than I expected. We've reduced our expenses by about 25%, the money I get from the government for the first 6 months is about 30,000 less a month than my after tax wages. Have to pay residency tax at the convenience store though so that needs to be factored in.
Because I wasn't sure how our finances would look taking a year off, I had more cash than I needed in the bank. With reducing expenses, using some of the cash I had in the bank and some of the money from the government, 2 tsumitate NISAs will be maxed, 2 iDecos maxed, will max J-NISA too when it's set up, and was also able to invest some of both our summer bonuses in taxable accounts.
With regards to taking the time off causing me issues in the future at my job, couldn't give a shit - would make the same decision again without a doubt.
My biggest takeaway: reducing expenses will allow us to have much more flexible lifestyles with more family time and this time off is making me reconsider my future plans.
Re: 2021 and beyond
Posted: Wed Jun 30, 2021 5:21 pm
by Tkydon
Kanto wrote: ↑Wed Jun 30, 2021 6:27 am
I disagree with the J-Nisa point. I think parents should try their best to ensure their children finish tertiary education debt free.
Not sure which person's comment you were referring about the J-Nisa point.
I fully agree that the parents should try their best to ensure their children finish tertiary education debt free. Hence, I suggested that investments in J-NISA AND other savings are going to have to be made in order to pay for the kid's tertiary education.
The reason I made this point so strongly is because 20+ years ago I grossly underestimated the cost of college, and having saved vigorously since my kids were born, only accumulated enough in those particular accounts to pay for about half of their Tertiary Education, as they ended up going the private (AKA more expensive) route. I told them that due to their choice, the other half would have to be a Student Loan...
Can't remember if I really maxed out the contributions, or if we didn't put the final goal high enough ('cause it's 20+ years ago, you know
), but anyway, our budget came up short... It would probably have been enough for a Japanese Public Uni...
So, Better set the Goal High and try to have some left over...
But - Better Short, Than Having Nothing At All !
Yossarian wrote: ↑Wed Jun 30, 2021 12:56 pm
With regards to taking the time off causing me issues in the future at my job, couldn't give a shit - would make the same decision again without a doubt.
Good to hear it. I just put it out there for clarity.
Re: 2021 and beyond
Posted: Thu Jul 01, 2021 2:00 am
by kuma
Yossarian wrote: ↑Wed Jun 30, 2021 12:56 pm
Thanks for asking - he's a happy and healthy baby. My wife had a really tough couple of days but she's recovering now. And of course it was difficult not seeing them for a week, although I was there for a few hours on his birthday.
Re parental leave: Think it's one of the best decisions I have ever made. Having lots of fun with my son and it's financially a lot better than I expected. We've reduced our expenses by about 25%, the money I get from the government for the first 6 months is about 30,000 less a month than my after tax wages. Have to pay residency tax at the convenience store though so that needs to be factored in.
Because I wasn't sure how our finances would look taking a year off, I had more cash than I needed in the bank. With reducing expenses, using some of the cash I had in the bank and some of the money from the government, 2 tsumitate NISAs will be maxed, 2 iDecos maxed, will max J-NISA too when it's set up, and was also able to invest some of both our summer bonuses in taxable accounts.
With regards to taking the time off causing me issues in the future at my job, couldn't give a shit - would make the same decision again without a doubt.
My biggest takeaway: reducing expenses will allow us to have much more flexible lifestyles with more family time and this time off is making me reconsider my future plans.
Great to hear; congratulations.
How was the process of applying for the childcare leave? When did you and your wife (a) apply for the leave, and (b) start it?
Will you be due a tax refund at the end of the year? If you've had income tax deducted at source from salary (say for Jan-Mar), and if that's automatically calculated as though you would be earning at that rate for all of 2021, the assumption will be wrong, and a greater proportion of your 2021 income will actually be within the 0% tax bracket... especially if you are still maxing iDeCo so racking up tax deductions?
Re: 2021 and beyond
Posted: Thu Jul 01, 2021 4:57 am
by Yossarian
kuma wrote: ↑Thu Jul 01, 2021 2:00 am
How was the process of applying for the childcare leave? When did you and your wife (a) apply for the leave, and (b) start it?
Will you be due a tax refund at the end of the year? If you've had income tax deducted at source from salary (say for Jan-Mar), and if that's automatically calculated as though you would be earning at that rate for all of 2021, the assumption will be wrong, and a greater proportion of your 2021 income will actually be within the 0% tax bracket... especially if you are still maxing iDeCo so racking up tax deductions?
The process is very simple - I told my employer last October that I would be taking parental leave for the 2021 academic year then after the birth had to submit some documents. After doing that, my employer started the process with Hello Work. All paperwork and communication with Hello work is done by the employer. Every 2 months (or each month in my wife's case), HR will tell Hello Work how much we would have been paid for that period, then Hello work processes the payment.
I took April off using paid holidays and started parental leave on May 1st. My wife just started parental leave after maternity leave has finished.
Regarding tax, 年末調整 and 確定申告 will be done as usual at the end of the year so I assume I will be owed a tax refund as I paid tax Jan - April and summer bonus.
Re: 2021 and beyond
Posted: Sat Jul 10, 2021 4:37 am
by kuma
Yossarian wrote: ↑Thu Jul 01, 2021 4:57 am
kuma wrote: ↑Thu Jul 01, 2021 2:00 am
How was the process of applying for the childcare leave? When did you and your wife (a) apply for the leave, and (b) start it?
Will you be due a tax refund at the end of the year? If you've had income tax deducted at source from salary (say for Jan-Mar), and if that's automatically calculated as though you would be earning at that rate for all of 2021, the assumption will be wrong, and a greater proportion of your 2021 income will actually be within the 0% tax bracket... especially if you are still maxing iDeCo so racking up tax deductions?
The process is very simple - I told my employer last October that I would be taking parental leave for the 2021 academic year then after the birth had to submit some documents. After doing that, my employer started the process with Hello Work. All paperwork and communication with Hello work is done by the employer. Every 2 months (or each month in my wife's case), HR will tell Hello Work how much we would have been paid for that period, then Hello work processes the payment.
I took April off using paid holidays and started parental leave on May 1st. My wife just started parental leave after maternity leave has finished.
Regarding tax, 年末調整 and 確定申告 will be done as usual at the end of the year so I assume I will be owed a tax refund as I paid tax Jan - April and summer bonus.
Thanks for the reply, and glad all is going well. Lots of info in your reply that could be useful to others, such as the mechanics of receiving the childcare leave allowance.
Did your childcare leave start within your wife's maternity leave (8-week period after birth)? If so, were there any complications? I saw some info which suggested this might be tricky (
https://www.mhlw.go.jp/file/06-Seisakuj ... 169713.pdf) when I looked into childcare leave for my circumstances, but I didn't look into the fine detail, and would love to hear that it's actually quite father-friendly. Also, I understand new law has been passed granting further flexibility to fathers in taking childcare leave (which will be enacted next year;
https://www.japantimes.co.jp/news/2021/ ... xible-men/).
Re: 2021 and beyond
Posted: Sat Jul 17, 2021 12:09 am
by Yossarian
kuma wrote: ↑Sat Jul 10, 2021 4:37 am
Did your childcare leave start within your wife's maternity leave (8-week period after birth)? If so, were there any complications? I saw some info which suggested this might be tricky (
https://www.mhlw.go.jp/file/06-Seisakuj ... 169713.pdf) when I looked into childcare leave for my circumstances, but I didn't look into the fine detail, and would love to hear that it's actually quite father-friendly. Also, I understand new law has been passed granting further flexibility to fathers in taking childcare leave (which will be enacted next year;
https://www.japantimes.co.jp/news/2021/ ... xible-men/).
My leave started on May 1st just a few days after the birth. No complications at all with that. Everything was really easy for me but of course depends on employer. Seems the government is trying to encourage fathers to use the system, hence going to 80% of salary from next year, but culture at individual employers will of course have a big affect on how easy the process is.