R here stands for retirement lah. Whether it’s 45 (wow… congratulations to you), 55 (okay, about normal), 65 (still healthy, why sit down and watch TV?) or even 75 (like some seniors who could not afford to retire yet). On second thought, I do think I want to keep working but not a full time job yeah. Perhaps an occasional lecture in a university I like. Giving back to the society as they say. Anyway, regardless of when is the day, here are 5 things we ought to start thinking way ahead and having positive answers to all of them. If we miss even one of them, the R will not be retirement. It will become Regret instead. In the mean time, please make R as Responsible yeah.
#1 – Medical Coverage. Many believe that they do not need any medical card / medical insurance because they are seldom sick. Erm… any small procedure in a private hospital will cost thousands today. If we are not covered, these unpredictable expenses will quickly eat into whatever we have saved or worse still we have to start carrying debts. Go on, call your good friend who has been pestering you about that medical coverage and ask him to explain so that we can make a decision.
#2 – Savings, started? If we are already covered, then it’s time to look at saving, saving and saving money. Reminder. Without savings, it’s impossible to have enough to start investing. Could we save until we become a millionaire? Technically, possible. However, it’s going to be extremely tough to rely just on our savings if it is only growing by a very small percentage point every year. Buying a good blue chip stock for example may yield us good divideds per year and the potential appreciation from stock price. Buying a property meanwhile allows us to always hedge against inflation because one major reason why property prices get higher is because the value of money gets smaller over time.
#3 – When do we intend to retire? If we started working at the age of 21 like me, by 56 years old, we would have worked for 35 years. Oh dear… 35 years!! Haha. Actually, it’s great to plan ahead. Determine when we INTEND to retire, start calculating backwards and set goals along the way so that we have milestones which could guide us. Else, we will always think, “It’s okay, retirement is still so far ahead in the future.” By the way, on the day we retire and we found out we did not start earlier, regret then is of little use yeah. Decide the WHEN and start the DOING now…
#4 – Income after retirement? Most of us would think we could rely on our EPF savings after we retire. Well, the statistics show majority of Malaysians do not have enough in their EPF savings to last the next 25 years after retirement. Even assuming we are not within this group would also tell us that it’s foolish to have ONLY the EPF savings by then. Have we started to buy some properties which could give us continuous rental income? How about accumulating dividend stocks? What about buying unit trust on a monthly basis and FORGET about it so that we have a great surprise in future? (click to see how to do it easily)
#5 – What do we want to do after retirement? If the current plan is watching TV everyday, it’s best to have a better plan yeah. We can think about some potential part-time jobs (driving GRAB is one potential if we are still very healthy), lecturing part-time in a local college (for those with a Master / PhD) and even managing our properties (if we have accumulated many). By the way, we need to have some plans to spend the remaining 25 years after retirement (if we chose to retire at 55). Many times, planning does not mean we will be able to achieve it but without planning in advance, then failure is quite a certainty.
R stands for retirement and we should prepare for it very well. If we did not, then R will stand for Regret. For those who believe their government will be able to take care of them, please do read more about many of the advanced nations of the world. There are many where the governments are struggling to do a good job. The ones who suffer will be the seniors who did not prepare well in advance. Assuming, the government will be able to do a good job in the future, nothing wrong for us to also be prepared yeah. Happy preparing…
<Featured Image is courtesy of Stock Photos from aslysun>
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