Things You Should Know

Research shows that the elderly in Malaysia depend on their EPF as the main source income upon retirement.

Member's average savings at age 54 is only RM 166, 650 or RM 694 per month if the member survives another 20 years.

Today's RM 694 will only be worth RM 497 in 10 years' time or RM 356 in 29 years' time, assuming an annual rate of inflation of 3.4%.

THE SCOURGE OF INFLATION

While we do not know what the future holds, one thing is certain-inflation will make everything more expensive as years go by.

The cost of living rises every year, and your savings may not be adequate to maintain your current standard of living during retirement.

Some of us may think that we're ready for retirement because we have savings in the EPF. But do you know that the 2013 EPF statistics for member aged 54 years revealed that:

72% of EPF members have savings of RM 50,000 and below.

The active EPF members' average savings at age 54 is approximately RM 166,650.

On 1 January 2014, EPF has revised the basic savings quantum to RM 196, 800 as its approach to ensure its members have sufficient retirement income above Malaysia's poverty threshold. Hence there is an urgent need for Malaysians to increase their savings.

There are many people who retire without a plan or know what to expect until they realize it is too late. To enjoy the lifestyle you want at retirement, you need to be prepared. Whether to live a simple carefree life or to live comfortably, you need to start saving now.

Source: EPF Annual Report 2013 & aia-prs