Old-age healthcare and retirement planning: buy TSMC or buy insurance?

Entering life's second half, facing potentially enormous medical costs — should you buy insurance to defend, or invest to grow? This piece distills the professional views of a CFP-certified financial planner, busting retirement myths and using proper asset allocation and cash-flow planning to secure a stable life after illness, in advance.

1. Insurance and investing differ in essence: follow the 60-30-10 rule

Insurance plays defense; investing plays offense. Their purposes are entirely different and should not be conflated.

• Use 60-30-10 to leverage small for large: at any age, split income into 60% daily expenses, 30% investment and savings, 10% risk management (insurance). Spending one-tenth to protect nine-tenths of your assets is the steadiest safety net.
• Investment cannot prevent sudden risk: investments need time to grow — nothing doubles overnight. If illness arrives early, there is no time to liquidate; and with no insurance at all, urgent needs force selling assets at a loss.

2. The core after 50: cash flow is king, and keep an emergency reserve

Youth can chase rapid asset growth; the pre-retirement stage after 50 must pivot to cash flow and liquidity.

• Keep an ample emergency reserve, with three thresholds: the floor is six months of essential living expenses; a steadier standard is six months of income; if that still feels thin, set the 'security number' that lets you sleep — say NT$800,000 or NT$1,000,000.
• Build stable retirement cash flow: use steady income-distributing instruments, or spread funds across sound banks and broad market indexes, creating a stream that outlasts your lifespan.

3. Bust the inheritance myth: take care of your own old age first

In Chinese-speaking societies, elders habitually reserve resources for children — even transferring all assets early to avoid tax — ignoring the human-nature risk of having no money when illness comes.

• Caring for yourself is caring for family: true love for your children is putting your own security first. With sufficient medical and eldercare resources of your own, serious illness will not dump crushing bills and agonizing decisions on those beside you.
• Inventory and plan early: the best window is your 40s and 50s while health allows. Wait until illness strikes and your options shrink drastically.

4. Use trusts and wills to defend your final quality of care and life

Beyond holding cash, compliant financial tools protect old-age care more efficiently.

• Trusts for dedicated use: place part of your assets in trust with steady allocations, contractually reimbursing future medical receipts as incurred — preventing misappropriation and fraud — or steadily paying senior-housing rent so you are never evicted because a relative failed to pay.
• Ensure the will is executable: beyond unchallengeable legal validity, the content must be practically executable. Corporate equity succession, for instance, does not take effect merely by being written — pair the will with a lawyer's comprehensive analysis and arrangement.

Old-age medical needs demand that cash flow and asset allocation be planned ahead — it takes time. Rather than agonizing over money at the sickbed, inventory your resources now and claim the greatest financial peace of mind. Investing and insurance are not either-or: they are the best offense-defense formation of a lifetime.