EPF News: When we are 54 years old, how much should we have as retirement fund?
Life expectancy for Malaysians?
Malaysians on average will live to nearly 80 years old. In other words, we do need a lot of money to sustain us after we retire at… 60? Or perhaps just work till 70, then it’s easier too. It’s a choice if we remain healthy and able. Okay, what’s the reality on the ground. Do Malaysians actually have enough funds to retire? Perhaps we look at how much a 54 year old Malaysian has in their EPF account? That should give us an idea of the life post-stable income years.
Article in nst.com.my Median savings of Employees Provident Fund (EPF) active members aged 54 were at its lowest since 2018, at RM132,826 as of Dec 31, 2022.
According to the report, 110,210 active members aged 54 had an average savings of RM246,111.87.
The EPF advocates a minimum savings of RM240,000 at age 55 for a RM1,000 a month allowance that will last for 20 years.
Of the total number of active members of 8.39 million (2021: 7.69 million), 568,963 were aged between 51 and 55 in 2022.
As at Dec 31, 2022 the number of members registered with the EPF was 15.72 million (2021: 15.22 million).
The number of new members registered grew by 50 per cent to 635,989 (2021: 421,643). Article in nst.com.my
Treat EPF as extra. Here’s how much one could have if we just save RM500 per month for 30 years.
Sikit-sikit, lama-lama jadi bukit. Bit by bit, it will grow to a hill one day. Skip the debate on EPF. Be responsible to our own self. Regret later is too late. Better learn that this is the reality and do somthing about it as soon as possible. If we save just RM500 per month, 30 years later, even if the FD rate stays just 3 percent, we will have close to RM400,000. if FD rate goes up by just 1 percent, look at the huge difference.
It’s a whopping extra RM100,000! With just 1% increase in the interest rate yeah.
The best? have at least one property which you have fully paid for
Assuming that property you bought for RM400,000 would just rise to RM600,000 by the time you retire. I know you wanted to say that the interest you paid way higher than the appreciation of RM200,000. Noted. Just remember that no matter how, you will still need to pay rental anyway. Treat this as paying rental but at the end of the day, you get the home too.
Paying extra for interest versus nothing at the end of 30 years if it’s not your own home. This RM600,000 home, you just sell at the end if indeed you prefer to use the money to go for vacations. It will come in handy for many other potential purposes too.
This property will then be on top of your EPF and perhaps any other savings you have done over the years too. Happy knowing and taking actions.
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