I avoided calculating my own retirement number for years. Not because I didn’t know how. I’ve been in asset management for most of my professional career, first as an analyst, then as a portfolio manager, and now as chief investment officer. I knew the math. What I didn’t want was the answer.
There’s a specific kind of avoidance that busy, responsible people are good at. It doesn’t look like neglect. It looks like having legitimate reasons why this particular conversation with yourself keeps getting postponed. The present is loud. The future is abstract. And as long as you’re doing something, it’s easy to tell yourself you’re on track.
The problem is that doing something and building toward something are not the same thing. The difference is a number.
Specifically, how much your portfolio needs to be worth by the time you stop earning. In the Philippines, the standard benchmark is 20 to 25 times your expected annual retirement expenses. That’s the target. Everything else in your financial life either moves you toward it, or doesn’t.
Getting there means being honest about three things: when you want to stop working, how long you intend to live, and what that life actually costs. Not a rough estimate, but the specific life you’re planning for, with real line items. I intend to live a long time, active and present for my children and eventually their children. It adds years to the calculation that most people leave out.
The expense figure is where most people go wrong. The official inflation target is 2–4% and that’s what ends up in most retirement projections. But that number doesn’t reflect how the spending of someone whose lifestyle has grown with their income actually behaves. Education, private health care, the cost of maintaining a standard of living you’ve built over two decades, those don’t inflate at 2–4%.
A household spending ₱100,000 a month today is probably looking at 6–8% annual growth on those specific line items. At 7%, that figure becomes closer to ₱275,000 a month in 15 years. The gap between what the official inflation rate tells you and what your life will actually cost is where retirement plans quietly fail.
I understand the competing pressure because I’m living it. I’m a solo parent with children still in school, and the weight of this life stage shows up not in one big line item but in the accumulation of everything else: household help, food, transportation, the activities and logistics of raising kids largely on your own. None of it is extravagant. All of it is constant.
The same income that’s supposed to be building my future is also covering the full cost of a present that doesn’t pause. But some of those obligations are temporary. The kids get older. The daily logistics shift. What eats into your investable income today won’t eat into it forever, and what happens to that cash when it frees up is one of the more consequential financial decisions most people make without realizing they’re making it.
For private-sector employees, the Social Security System pension averages around ₱5,123 a month. That works out to roughly ₱170 a day, about what most young working people spend without a second thought on a Starbucks order. Whatever gap exists between that and the retirement you’re planning for is a gap your portfolio has to close.
Knowing the size of that gap is what determines how your portfolio should be positioned: how much risk it needs to take, what asset mix makes sense given your timeline, how hard your money has to work relative to how many earning years you have left. None of those questions have good answers without a number to work from.
I’m still closing my own gap. The number I found when I finally looked was uncomfortable. But uncomfortable and unworkable are different things. It gave me something toward which to orient.
Do you know your number? Not roughly, but the actual figure, the actual timeline, the actual life you’re trying to fund.
If the answer is no, that’s where to start. The math isn’t the hard part. The hard part is deciding to look, and then letting what you find actually change what you do. That’s what discipline means in investing, consistency with a specific thing in mind. CS
Alessandra Araullo is the Chief Investment Officer for Advisory at ATRAM. This piece was written for educational purposes only and does not constitute investment advice or a solicitation to buy or sell any financial product.
