When is the best time to invest surplus funds beyond the tax-exempt limit?

Hello, this is Sho!
In this note, with the theme of "Making every day more fun! Toward a petit-rich life through asset formation,"
I, Sho, a former ordinary office worker who went from 10 million yen in debt to over 100 million yen in managed assets and achieved side FIRE in my 30s,
will talk frankly about tips for asset formation and points for increasing your money😊

Today, I will talk about "When is the best time to invest surplus funds beyond the tax-exempt limit?"

【Do you have these concerns?】
"Is NISA alone enough for retirement funds?"
"Should I also use a taxable account?"

Many people who start investing get lost at this "next step."
Even though you've worked hard to save up with NISA,
you feel anxious, wondering, "What should I do once I've used up my tax-exempt limit?"

Today, I will organize the answer to that from both the perspective of numbers and mindset💡

【① How much value does the 18 million yen NISA limit have?】
NISA is a very excellent system.
For example, if you invest a maximum of 18 million yen at an annual interest rate of 5% for 20 years,
it will grow to approximately 54.2 million yen.

If you withdraw it over 30 years, that's about 280,000 yen in monthly income.
This alone is a very reliable amount.

However, those who can receive this benefit to the fullest are those who "started early."
If you start at 50, you'll be 75, and
if you start at 60, even at age 65, your withdrawals will only be about 100,000 yen per month.

In other words, NISA is a system where those who start early can more easily enjoy the returns.

【② Who should use a taxable account, and for whom is it still too early?】
The "taxable account" appears after you have used up your NISA tax-exempt limit.
Investments here are subject to tax, but
it is an important option for those who want to grow their assets further.

For example, if you invest 10 million yen at an annual interest rate of 5% for 10 years,
it will grow to approximately 15 million yen even after taxes.

Especially for people with assets between 30 million and 80 million yen,
they often get lost at this "next investment."
They are the group that thinks, "NISA seems enough, but considering future expenses..."

In conclusion,
if your purpose is clear, it is well worth utilizing a taxable account.
However, if you just want to "increase it somehow," there is no need to force yourself to get involved.

【③ The axis of investment judgment is not "profit or loss" but "life planning"】
This is what I always want to convey the most.

Investment decisions are more about "when, with whom, and how you want to live"
than "how much it will increase."

If you don't have this axis,
there will definitely come a moment when you won't feel satisfied even if your money increases.

・Do you want to spend your 60s in abundance?
・Do you want to grow it carefully in preparation for your 80s and 90s?

Depending on that answer,
whether you complete it with just NISA or also use a taxable account will change.

NISA is a system that makes "youth" your ally.
A taxable account is a system for those who have a "purpose."
How you use these two differently is the key to asset formation that you can be satisfied with.

【④ Tips for action】
If you read today's story and thought, "Which one am I?"
please try writing down your life plan on paper once✍️

・Future income and expenses
・At what age do you want to spend money and on what?

A rough estimate is fine.
Just by doing that, it will naturally become clear whether "NISA alone is enough!" or "It looks like a taxable account is also necessary..."

【⑤ Today's Summary】
① The value of NISA changes significantly depending on your age
② Taxable accounts are best suited for those who have a specific "purpose"
③ Investment decisions are key not based on "profit or loss" but on "conviction"🔑

How you spend your money is how you live your life.
Don't just get caught up in the numbers,
let's make choices with a focus on "how I want to live"☺️

【Postscript】
I also talk passionately about this topic on Voicy🎙
If you want to learn more through audio, please listen to Voicy from my profile🦻
#174 When is the best time to invest surplus funds beyond the tax-exempt limit?
https://voicy.jp/channel/821850/6964133

Your comments and reactions are the energy behind my content creation☺️🙏
If you have any questions or things that caught your interest, please feel free to comment💬

I hope this note serves as a hint for your learning and asset building🌿
See you in the next note📘✨

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