28 May 2007 | Comments | Money Saving Tips, Retirement | Comments feed

Only 5% Ready for Retirement in Malaysia

The Star newspaper reported some discouraging facts about retirement in Malaysia:

A daughter graduated from university this year is getting paid RM1800 monthly salary, which is the same as what her father got 25 years ago.

Wages have not moved in tandem with the rise of the cost of living and inflation. That trend is expected to continue.

“Less than 5% are prepared for retirement,” estimates Life Insurance Association of Malaysia (LIAM) president Ng Lian Lau.

People are living longer, but get married much later. This means their children are still young when they reach retirement age at 55. They had to give up everything (including their retirement fund) for their children education.

Medical inflation is 15% each year which eat into the savings.

Going by statistics revealed in EPF’s 2005 annual report, about 90% of EPF contributors have less than RM100,000 in their accounts.

On 25^th May 2007, new amendments to the Employees Provident Fund Act would allow contributors to withdraw money to buy insurance for critical illness for themselves and their family. This is the only good news.

Read the full story.

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