Overall Retirement Plan + Children Education Plan - Two Kids Plan

Mr. E aged 35 years old, plans to marry now and hopes to have two kids - 1st kid right after marry and 2nd kid one year after marry. What is the retirement fund and children education fund for the overall family plan?

Assumption:
1) His wife and Mr. E are same age
2) His wife and Mr. E plans to work till 60 years old
3) His hife has monthly RM500 EPF contribution with the beginning saving of RM40,000 at the Account I and Account II. EPF annual dividend is 6.0% p.a.
4) Mr. E's asset appreciation at  pre-retirement rate of 10% p.a. while post-retirement rate of 8% p.a., salary increment at 5% p.a., cost of living inflation at 3.2% p.a.,
5) Children Education fees (school fees and living cost) RM25,000 p.a., inflation at 6% p.a., education fund performance at 8%. p.a.
6) Miscellaneous expenses: RM1,500 monthly for contingency reserve 

Financial Planning approaches:
1) Target Replacement Ratio: 80%
2) Retirement fund calculation - principal liquidation

 V@35 denotes Mr. E's value at current age while V@60 denotes Mr.E's value at retirement age. It has a negative net worth after the consideration of offsetting liabilities with the asset. Thus,
Mr. E has to plan some action for his retirement fund and children education fund preparation.

You can replace the Mr. E figures by yours. Check and see the result.


The previous result is based on the assumption 4, 10% p.a. for the net worth appreciation CAGR. What is the desired return that Mr. E required in order to have the net worth at RM 0?
By using solver, 11% p.a. CAGR is calculated. Thus, he needs to ensure that his asset appreciation must be over 11% p.a.

However, Mr.E required a house and a car ++ till 85 years old. So, the solver is re-simulated by reserving 395k@60 years old. Thus, he needs to ensure that his asset appreciation must be over 11.28% p.a.

After the study of his portfolio CAGR return, which is 13.2% p.a. When will be his financial freedom age?

From solver, his financial freedom age is 40 years old. Thus, he has to ensure his portfolio return can generate 13.2% p.a. CAGR every year till 85 years old.