Most employees in the private sector, and nearly all self-employed professionals, have to build most of their own retirement income. Government benefits help, but they’re rarely the full picture.

The question isn’t “will I have enough?” It’s “enough for what, starting when?”

Step 1: Estimate your retirement spending

Take what you spend today. Remove costs that will end: school fees, a mortgage that will be paid off, work-related expenses. Add costs that will grow: healthcare, support for ageing parents, leisure time.

Be honest about what you hope retirement looks like. It determines the number.

Step 2: Estimate the years

Decide your target retirement age. Then plan for a long retirement, because living into your late eighties or nineties is realistic for many people. A plan that runs out at eighty is a plan that fails the person it was meant to protect.

Step 3: Subtract guaranteed income

List any income you can count on: government pension entitlements, annuity-type payouts, rental income. Be conservative.

What’s left is the gap your savings and investments have to fill.

Step 4: The rough size of the gap

A commonly used rule of thumb is that a nest egg of roughly twenty-five times your yearly gap supports sustainable withdrawals, but this depends on returns, inflation and how long you need it. Treat any rule of thumb as a starting estimate and refine it with a professional.

Step 5: Work backward

Divide the target by the number of years until retirement to find the yearly amount. Then break that into a monthly figure.

If it looks impossible, don’t quit. Run three versions: ideal, realistic and minimum. Each tells you something. Starting small beats not starting.

Things people forget

  • Inflation, which erodes fixed amounts.
  • Healthcare costs, which rise with age.
  • Supporting others, which may continue in retirement.
  • Sequence of returns: bad markets early in retirement hurt more.

Do this now

Write one sentence: “To retire at ___ with ₱___ a month, I need roughly ₱___ saved.” Even a rough guess helps. You can only improve a number that exists.