Do you have enough after retirement?

[LMei]

CAN a 35-year-old Malaysian executive earning about RM4,000 a month afford a comfortable lifestyle after retirement at 55?

http://www.nst.com.my/Current_News/nst/Monday/Frontpage/20070312080117/Article/index_html


Yes, it is possible to live the same lifestyle in 20 years’ time but it is going to cost a bomb.

One will need to have between RM1.4 million and RM2.8 million at retirement to maintain the same lifestyle depending on which financial planner one talks to.

Many of us are in the less than RM4000 a month category. How can survive?

[firefox]

I think i should have enough if i change my life style and live humbly.

[JayChou]

1.4 million does not include :-
a. house, which you might still be paying.
b. children's education if they are still attending college

so, must have at least 2 million la

[ava]

Does this 1.4 mil - 2.8 mil for one person only or both husband and wife?

[xaviers]

Assume there is no inflation:

after 55 years assume you need RM4000 a month to survive

1 year you need to have = RM 48,000

if you live for another 15 years (i.e. aged 70 ) = Rm 720,000

so

1) with inflation
2) medical bills since you're old and need medication, check-ups etc. (provided your averagely Ok)
3) about the same lifestyle

RM 1.4 million looks about right.

[LMei]

Does this 1.4 mil - 2.8 mil for one person only or both husband and wife?
I think it's for one person. Calculation takes inflation into account.

[mlkok]

Being the credit driven society we are becoming today, that's gonna be a tough challenge. Malaysians today are picking up the need to spend tomorrow's money today. There's an excuse to buy lots of unnecessary items.
In short, most would already have spent their retirement savings way in advance. :D

[xaviers]

My worry is that

I can't save as I have school going kids so saving is really tough, especially when you need to take your family for short holidays once in a blue moon.

Another problem is that whether my EPF money is there when I retire ..get the hint?

Work work work .... in the end got nothing to show for it.

[sharon batu]

I think i should have enough if i change my life style and live humbly.

You are right and I agree with you. When a person retires, he or she should live like a retiree and within his means. Otherwise, how much is enough?

[USJ9chin]

If you compound RM4,000.00 for twenty years says from age 35 to 55 at 3.5% p.a., you should be getting around RM1.387 million at retirement.

How many of us can save RM4,000.00 every month for 20 years and so discipline that you do not change new car, buy new plasma TV, go holiday with family, change new house, renovate house, buy shares, buy unit trust, eat good food, etc....................

In order to save RM4,000.00 monthly, one must earn five figure income
for 20 years.

This is only an ideal situation.

Maybe this kind of financial planner aims for up market only.

I wish I can be his client.

[kokomo]

RM4,000 a month is not enough even for a single person, cos nowadays people are living live a lil bit more luxuriously with that amount of income ie:- go for holiday 2-3 times a year, every weekend go about having good food, car instalment and petrol (yearly increased), household stuff, money to parents, shopping, utility bills, credit card debts and etc ... mana cukup?

Say live within means of it, somehow, money earn .. will definitely feel unsatisfied if hard earn of sweat and blood money is not spend on our own to have a lil luxury to relax and not think of work. Side income start to come in already ... what more if some of us are earning less than that?

I've yet to see anyone that is so discipline to even save $100 every month into their bank acc. What more if they wanna save $4000 every month. Definitely not possible to majority.

[sharon batu]

RM4,000 a month is not enough even for a single person, cos nowadays people are living live a lil bit more luxuriously with that amount of income ie:- go for holiday 2-3 times a year, every weekend go about having good food, car instalment and petrol (yearly increased), household stuff, money to parents, shopping, utility bills, credit card debts and etc ... mana cukup?

What happen to those who are earning less than RM2000 or even RM1000 a month? Like I say, one has to live within one's means. I do not think a retiree can go for holiday 2-3 times a year, go for good food every weekend and paying car instalments for the shiny new BMW. A retiree must live like a retiree. If he doesn't want to, then he should continue working until he dies.

[hhtee]

if you save enough, should be no problem.

E.g.

Let's go to Starbucks. Drinks = RM10.00

Let's go to normal Kopitiam. Drinks = RM1.00 to RM 1.40

Let's eat something in Starbucks. Sandwich = RM 12.00

Let's eat the normal Kopitiam steam / toasted bread RM 1.00 (or is it less)

Similarly, if you go to those Uncle Lim Kopitian, Old Town Kopitiam, etc. and you compare the prices there and compare that with the normal Kopitiam (where some uncle and aunty spits on the floor), you can see the price difference.

[hhtee]

Don't get a girl friend.

Don't get married.

:D

[sherrygin]

It's not what you make, it's what you spend.

A friend of mine told me once, "though I now earn 6k, but I still lead the same lifestyle as I did when I had my first job, when I earned 2k"

[mon]

Like I say, one has to live within one's means.

Even better, one can try to live 'below' one's means.

[protozoa]

I do not have enough now, how to have enough for future.........

[cheapwristwatch]

I do not have enough now, how to have enough for future.........

Please define 'enough'.


It's not what you make, it's what you spend.

A friend of mine told me once, "though I now earn 6k, but I still lead the same lifestyle as I did when I had my first job, when I earned 2k"

Real words of wisdom. Thank you.

[CS Chua]

To enjoy one's retirement, two things must be paid off: the house and the car. Then the other expenses are for living and entertainment.

For the house, it is not necessary to have a house per se as the children have left the nest. I think a 3-room apartment of around 1000 sq ft is sufficient for a couple. So sell the house and buy an apartment or condo and use the extra money for living.

That is my current plan. I hope to sell my SJ house when I am ready to retire and use part of it to buy a condo. It does not have to be in prime area. The price drops drastically when it is in a new area or further away. As a retiree, I do not have to be in a prime area. Just somewhere quiet and safe. And clean. And with good neighbours.

[kokomo]

What happen to those who are earning less than RM2000 or even RM1000 a month? Like I say, one has to live within one's means. I do not think a retiree can go for holiday 2-3 times a year, go for good food every weekend and paying car instalments for the shiny new BMW. A retiree must live like a retiree. If he doesn't want to, then he should continue working until he dies.

Now those who are working are already thinkin' of retirement but those who retired are thinking which/what job can I do at my age. So who says people won't want to work until they die? Some do. But the rest of us, with whatever amount that we can earn back or bring back home, still have to work around with the budgets.

Anyone that earns less than RM2000/1000 a month, somehow are blessed and manage to pull thru every month. They maybe living happier than others that has higher income. Lesser commitment, lesser burden, lesser debts (but also within the means of their income). Be what you are and what you should.

[gtl]

Even better, one can try to live 'below' one's means.

i SECOND that motion..................

[cheapwristwatch]

To enjoy one's retirement, two things must be paid off: the house and the car. Then the other expenses are for living and entertainment.

For the house, it is not necessary to have a house per se as the children have left the nest. I think a 3-room apartment of around 1000 sq ft is sufficient for a couple. So sell the house and buy an apartment or condo and use the extra money for living.

That is my current plan. I hope to sell my SJ house when I am ready to retire and use part of it to buy a condo. It does not have to be in prime area. The price drops drastically when it is in a new area or further away. As a retiree, I do not have to be in a prime area. Just somewhere quiet and safe. And clean. And with good neighbours.

I could not agree more. There is also the possibility of living outside the Klang Valley. If you are retired, then there may not be a need for you to stay in SJ as you no longer commute to work. Seremban, Melaka or Ipoh are nice alternatives. Cheaper houses, less traffic and cheaper cost of living in general. You also do not need a new CRV or some fancy sports car but a second-hand Myvi would do nicely. Even if you continue to stay in SJ, you would still save a lot on petrol and tolls as you no longer drive to work every day.

[cheapwristwatch]

i SECOND that motion..................

I second-second that motion. Wise words indeed.

[kokomo]

Actually now living in Seremban, Melaka or Ipoh, the expenses there aren't too far away from living in KL. To me, I feel, if the house are already paid off in Subang Jaya, there ain't much big expenses around to spend in Subang. Besides if we retired and kids are out of the house already, I believe they will come back wif grandchildren that time it would be grand wouldn't it. So if stays in an apartment, mana cukup?!?!

[cheapwristwatch]

Actually now living in Seremban, Melaka or Ipoh, the expenses there aren't too far away from living in KL. To me, I feel, if the house are already paid off in Subang Jaya, there ain't much big expenses around to spend in Subang. Besides if we retired and kids are out of the house already, I believe they will come back wif grandchildren that time it would be grand wouldn't it. So if stays in an apartment, mana cukup?!?!

I have to disagree. You can sell off your corner linked house in SJ for RM500k and a similar one in Ipoh costs around RM180k. It means you have additional cash in the bank to make your retirement even more pleasant.

[FineTuned]

This thread is so depressing lah. All my life I work like a d*g, now they say I need to work harder to survive my retirement......... :eek:

Feel like throwing in the towel and become a beach bum.

[cheapwristwatch]

This thread is so depressing lah. All my life I work like a d*g, now they say I need to work harder to survive my retirement......... :eek:

Feel like throwing in the towel and become a beach bum.

You have a point. I think we worry too much. We do not even know what is going to happen tomorrow and we worry about 30 years down the road and grandchildren visiting us and the cost of a plate of noodles. Live each day to the fullest. Be contented. Be at peace with ourselves. No need to get agitated over small matters (and for that matter, many matters which are actually none of our business). No need to prove that we are the greatest and must win all arguments. Nothing is a certainty in this life. The only certainty everyone of us have to face one day is Death.

[PeterHng]

To enjoy one's retirement, two things must be paid off: the house and the car. Then the other expenses are for living and entertainment.

For the house, it is not necessary to have a house per se as the children have left the nest. I think a 3-room apartment of around 1000 sq ft is sufficient for a couple. So sell the house and buy an apartment or condo and use the extra money for living.

That is my current plan. I hope to sell my SJ house when I am ready to retire and use part of it to buy a condo. It does not have to be in prime area. The price drops drastically when it is in a new area or further away. As a retiree, I do not have to be in a prime area. Just somewhere quiet and safe. And clean. And with good neighbours.


Another matter of importance and very capital intensive is our children's education. Hopefully by the retirement time, all our children already finished all the necessary education and in the working world. That would really take quite a burden off our shoulders. If not finished then got to save sumore:eek:

[xaviers]

get married at 21 have kids when you're 22-25.. so when your kids are 20 you will be 42-45.. still can work some more.


:)


work work work... pay taxes, pay bills etc. I better get back to work now

[fabregas]

I know it sounds hard and depressing but you have read up and start planning now. There was an interesting excerpt from Public Bank annual report.
"If a shareholder of Public Bank had bought 1000 shares in Public Bank when it was listed in 1967, and assuming the shareholder had subscribed for all the rights issues to date and had not sold any of the Public Bank shares, he would have, at the end of 2006, 129,720 Public Bank shares worth RM1,005,330, based on the share price of Public Bank (Local) shares of RM7.75 at the end of 2006, in addition to having received a total gross dividend of RM390,576, whilst having spent a capital outlay of RM47,760, including subscription for all rights issue. The dividends received and the appreciation in value work out to a remarkable average rate of return of 19.5% for each of the 39 years that this shareholder has held the shares in Public Bank since it was listed in 1967."

I am not trying to "sell" the bank or the counter. But I think it illustrates that you can find relatively safe and high return investments out there. Read widely, and educate yourselves about them.

[dryyyap]

In an ideal world, yes. But how many people (apart from Teh Hong Piow and his family) would have held on to the shares for that long? There would have been situations along the way where one would have sold the shares due to greed or fear. It is just the natural thing to do. There are rumours going around that there may be another round of bank mergers and PBBank may eventually be 'swallowed up'. Hence the large dividends because the owners want to retrieve as much money as possible before this happens. Whether PBBank shares will rise in value due to this merger is anyone's guess. So whether the time is right or not, there is a certain amount of risk in holding on to shares a 'la Warren Buffett.

[fabregas]

In an ideal world, yes. But how many people (apart from Teh Hong Piow and his family) would have held on to the shares for that long? There would have been situations along the way where one would have sold the shares due to greed or fear. It is just the natural thing to do. There are rumours going around that there may be another round of bank mergers and PBBank may eventually be 'swallowed up'. Hence the large dividends because the owners want to retrieve as much money as possible before this happens. Whether PBBank shares will rise in value due to this merger is anyone's guess. So whether the time is right or not, there is a certain amount of risk in holding on to shares a 'la Warren Buffett.

Yes, you have a point. Again that was just an illustration that there are good investments out there. This scenario only called for an initial investment 1000 shares plus subscribing (cost around RM50K) for the right issues over 39 years. About over a thousand RM a year. I think the potential return for such a small outlay is worth the risk. Yes mergers happen, but not neccessarily a bad thing, road builder was bought over by IJM which is a good company. Or Southern Bank by CIMB.
There was some comments about being prudent and living within your means. I agree as well. A good offence and defence is vital for your retirement planning.

[dryyyap]

I think the article in the NST yesterday may have inadvertently scared many. I also just realised that the calculation was meant for one person. If you actually support your wife, the figure is doubled albeit somewhat less because you might share some things like the car, etc. It is scary, to say the least. Not to mention children's education and unforeseen medical bills.

My main gripe about living here is how Malaysians are made very poor by the high car prices. The 9 year loans should be banned IMHO.

Recently on the Suze Orman show, she mentioned that one would be lucky to find investments with a return rate of 6-8%. And it is near impossible to find a stable invesment at more than 10% returns.

I think someone should start a discussion on good invesments. Where are the financial advisors?

[orchipalar]

Err buddies...by the time one retires...say by 55 to 60yo...with a good health n some good fortune...it would be nice to have paid fully for home mortgage or loan...car loan...insurance policies...with no kids dependent on supports...n to have a substantial sum of money saved in FD to earn enough interest from that saving......or have a few 'hot' properties to generate income from the rentals...to cover the costs of living...n medical expenses...some extra cash to spend...n for the yearly occasional vacation trips...

Now that would be ideal...but in reality how many folks could actually be that comfortable...during their retirement ages.

Quite many years ago...a 500k FD account...could earn as much interest from bank...as roughly RM50K(10% interest)annually.

These days...it's down to RM15K or so...or even if one could save upto RM1 million hard cash kept in FD...the return could be as little as RM30K per year...roughly.

Worst is when a guy is diabetic n going blind...has hypertension...who needs regular kidney dialysis n other medical treatment...or if he is paralyzed from waist down...but he has a lot more than a couple of millions sitting in his bank account...err...how to enjoy living in his retirement ages...?

So...even if one doesn't save enough until the retirement ages...should he be healthy...he could still be productive n able to earn considerably......until his dying days.

Ahem...stay healthy buddies...it could be less painful retiring n growing old.

[dryyyap]

Without doubt orchi, health is number one but at a certain age, there is only a limited number of things one can do. I also wish and hope for good health but one never knows the cards you are dealt with, right? I hope that when my children become adults, there will a cure/vaccine for most cancers and other debilitating diseases. I can't imagine my children suffering.

[orchipalar]

Err yes buddy...especially when nobody wants to be a burden to somebody...a good health goes further than any monetary sense...during retirement ages.

Whenever we hear or read about some suicide cases...quite likely the victims could have been plagued by dire sickness...n constant pain...

[kokomo]

I have to disagree. You can sell off your corner linked house in SJ for RM500k and a similar one in Ipoh costs around RM180k. It means you have additional cash in the bank to make your retirement even more pleasant.

Well each individuals have diff kind of planning for retirement. For me, if I have a house which is already paid off, I won't want to sell it. On the other hand, might just save money and buy another land or apartment just to invest. Be it whether I buy and sell or I rent it away.

[cheapwristwatch]

Well each individuals have diff kind of planning for retirement. For me, if I have a house which is already paid off, I won't want to sell it. On the other hand, might just save money and buy another land or apartment just to invest. Be it whether I buy and sell or I rent it away.

It is a wonderful thing to have dreams and ambition. I am not doubting you nor saying you are wrong. Your dream and ambition is good and so do keep it up.

What I am trying to say here is that we are talking about retirement and the originator of the thread was asking whether it would be enough to live on a certain sum of money and he/she based this on the current RM4000 a month. In my view, barring inheritances or wind-falls, a person earning RM4000 a month with a family would find it difficult to retire if he or she doesn't live as a retiree (within the means of a retiree). I am talking about that. Of course a retiree can have RM200 million but then that is a different kind of retiree and not relevant to this thread.

[cheapwristwatch]

It is scary, to say the least. Not to mention children's education and unforeseen medical bills.

It is near impossible to afford to pay for medical care from private hospitals for critical illnesses. Thus a retiree may have to use government hospitals. It may be worth noting that insurance policies taken out on critical illnesses and hospitalization cease at age 60. Thus after age 60, either you have the money to go to private hospitals or you settle for government hospitals.

[geordie]

Prior to retirement :

Give your kids a good education. Not in the proper schooling sense ... Teach them independence (to stand on their own bloody feet!) and the value of $$$. Am I the only one who have known of retirees who have to fork out their hard earned savings to pay for their kid's wedding expenses, credit card, downpayment for house etc ??

And learning from other people's mistake, refrain from the temptation of renovating your house, upgrading your furniture etc when you first lay your hands on the EPF $$ (the one third for instance). If you're tempted to spend on your brick-and-mortar, makes more sense to reduce your mortgage instead.

[CS Chua]

It is also a good idea to start brainwashing your kids that the ultimate filial piety sacrifice is to give 30% of their salary monthly to their aged parents for eternity. :D Some of you may actually get away with that!! And what a retirement. London, here I come!

[genie1010]

get married at 21 have kids when you're 22-25.. so when your kids are 20 you will be 42-45.. still can work some more.


:)


work work work... pay taxes, pay bills etc. I better get back to work now

:D work work work...tat's wat we always do...dun think too much...enjoy life :rolleyes: have fun

[Feynman]

Retirement planning is part of financial planning.

There's lots of good information from proper established financial planning websites in the internet.

Malaysia:
http://www.fpam.org.my
http://www.ykconsultancy.com

International:
http://financialplan.about.com
http://www.cfp-board.org
http://www.fpa.asn.au
http://www.learningforlife.fsu.edu/course/fp101
http://www.efmoody.com

[kokomo]

It is a wonderful thing to have dreams and ambition. I am not doubting you nor saying you are wrong. Your dream and ambition is good and so do keep it up.

What I am trying to say here is that we are talking about retirement and the originator of the thread was asking whether it would be enough to live on a certain sum of money and he/she based this on the current RM4000 a month. In my view, barring inheritances or wind-falls, a person earning RM4000 a month with a family would find it difficult to retire if he or she doesn't live as a retiree (within the means of a retiree). I am talking about that. Of course a retiree can have RM200 million but then that is a different kind of retiree and not relevant to this thread.

Thank you.

Is there any retirees in here that is not living within their means? Is there any other retirees there can testify how are you dealing with your retirement time and fundings? Besides an earning of RM4000 a month making savings and so forth, a lil investment also would be good for future retirement. Nowadays are there still people around are living and enjoying and saving money just based on their monthly income? Or do you also have a small investment that started of as for fun and turn out to be for retirement time?

I believe the thread starter itself just want to have an idea on how to plan for his/her retirement age and whether fundings are sufficient based on a calculation of a < RM5000 a month income. Hehe ... dreams and ambition of another person sometimes can spread you know.

Good day to you cheapwristwatch. :)

[mon]

Err yes buddy...especially when nobody wants to be a burden to somebody...a good health goes further than any monetary sense...during retirement ages.

Just my few cents. You can replace things that you have or lost, but once good health is gone, it is gone, and good health cannot be regained no matter how much money one has. And I also think, that family relationships are irreplaceable. I have seen many parents working very long hours a day yes, to make more money, but they neglect their kids and relationship with their spouse. For most of them, time is money which I do not disagree..just that I thought that they could invest their time according to priorities ( I don't think they work the whole day 24 hours ) and determine a method so that they could have a richer family life as well. It's sad that some ppl literally do not have any extra time and they have to pay to get normal things done but at the end of the day, they still have to run back to the office to work overtime and not having enough time to spend at home. I think for us who have no children, or those who aren't married, this is the best time for us to spend wisely. 10 bucks here, 5 bucks there, makes a whole lot of difference if we were to think carefully before spending them unnecessarily..I have acquired this from a good friend. We can pay for the things we need without getting trapped in more debt than we can ever handle, using the credit card to pay for things we can't afford as yet, is one good example. We'll be caught in a situation where we're constantly paying for what we've done yesterday, instead of moving towards what we should be paying for, tomorrow, the more important stuffs, like a roof over our heads, or a car, for eg.

[cheapwristwatch]

I believe the thread starter itself just want to have an idea on how to plan for his/her retirement age and whether fundings are sufficient based on a calculation of a < RM5000 a month income. Hehe ... dreams and ambition of another person sometimes can spread you know.

Good for you. I don't have dreams and ambitions. I live my life of reality and I am contented as I am. My mother used to say: "Eat more when you have more money and eat less when you have less money. Nobody starves to death in Malaysia".

[cheapwristwatch]

We can pay for the things we need without getting trapped in more debt than we can ever handle, using the credit card to pay for things we can't afford as yet, is one good example. We'll be caught in a situation where we're constantly paying for what we've done yesterday, instead of moving towards what we should be paying for, tomorrow, the more important stuffs, like a roof over our heads, or a car.

This is going back to what you said about 'living below one's mean' and it is a very wise thing to do. I agree with that 100 percent. There is also a difference between needs and wants. I may want a beautiful bungalow but do I need it? I may want a BMW or a Merc but do I need it? I may want to go for overseas holidays three times a year but do I need it? But of course, I am not referring to those who are loaded with money. For them, their needs and wants are no longer separable because they can afford to do it.

[Kiwi]

I always wonder how will I be when I reached my retiring age, although it's still far away from the day…

Unfortunately, my life today is just like swimming in an endless ocean, I can't stop to swim and take rest for even a single second otherwise I will sink immediately.

I hope that I'm always be in good health, have enough strength and stamina to continue of my life journey, until my last breath. :rolleyes:

[kokomo]

Good for you. I don't have dreams and ambitions. I live my life of reality and I am contented as I am. My mother used to say: "Eat more when you have more money and eat less when you have less money. Nobody starves to death in Malaysia".

Very wise of your mom to tell you that. I agree with that too.

[orchipalar]

I always wonder how will I be when I reached my retiring age, although it's still far away from the day…

Unfortunately, my life today is just like swimming in an endless ocean, I can't stop to swim and take rest for even a single second otherwise I will sink immediately.

I hope that I'm always be in good health, have enough strength and stamina to continue of my life journey, until my last breath. :rolleyes:Err buddy...besides good health n longevity...time is the biggest wealth...that anyone could possess...

Everyone is born with that equal wealth...but not everyone could explore its fullest potentials...until it's too late.

[Joe Gomez]

Err buddy...besides good health n longevity...time is the biggest wealth...that anyone could possess...

Everyone is born with that equal wealth...but not everyone could explore its fullest potentials...until it's too late.AMEN to that ............

[Firefly]

Am I in trouble..... :(

Even now every month it's not enough...mounting debt and unpaid bills...how to save for retirement?? With everything going up..making ends meet is already a chore..at 48 now I can't even make any plans or savings for retirement. How?? :confused:

[CS Chua]

I have some ideas:

1. Change lifestyle? Use a P&S camera instead of a DSLR camera? The savings can go a long way to help out. :D

Other ways include buying good second hand cars instead of brand new cars and use it for 5-10 years before changing to another second hand car.

Cook and eat at home instead of going to restaurants every week.

2. If a person cannot save, buy a nice and big house so that he/she is forced to pay mortgages. At age 60, when the loan is paid up, sell it and move into an apartment.

3. If such person still have enough money every month after buying a nice and big house, buy a big insurance life policy and keep it until retirement!

Whatever you do, DO NOT BUY that BMW or Alfa Romeo etc. A house is better. It is a matter of choice.

[Firefly]

1. Change lifestyle? Use a P&S camera instead of a DSLR camera? The savings can go a long way to help out.

So who want's to buy my Camera??

Other ways include buying good second hand cars instead of brand new cars and use it for 5-10 years before changing to another second hand car.

Did that. Drove an old car till it was scrap value (11 years) Then it was not even enough to pay for the DP for anything...Finally had to beg the car sales man to help scrap it...ie total lost.

Cook and eat at home instead of going to restaurants every week.

Doing that already. Even skipping TT for that reason.

2. If a person cannot save, buy a nice and big house so that he/she is forced to pay mortgages. At age 60, when the loan is paid up, sell it and move into an apartment.

At my age now, cannot. The bank refuse to give me any load.

3. If such person still have enough money every month after buying a nice and big house, buy a big insurance life policy and keep it until retirement!


Now already not enough to eat...cannot even think of that.

Whatever you do, DO NOT BUY that BMW or Alfa Romeo etc. A house is better. It is a matter of choice.


Actually learn that already...the 11year old car that I had to scrap. Too late now.

[PeterHng]

so, Firefly, you mean to say everything is too late for you now?:D Wei, 48 is not very old yet you know. It's never too late to plan and to do something abt as long as you are still healthy and able to earn a living and to be the "driver" still:)

[orchipalar]

Am I in trouble..... :(

Even now every month it's not enough...mounting debt and unpaid bills...how to save for retirement?? With everything going up..making ends meet is already a chore..at 48 now I can't even make any plans or savings for retirement. How?? :confused:Err dear buddy...some people say...one man's misfortunes is another man's opportunity...

Heheh...should you have n wanna dispose of your rolexs(ORI punya)...jewelry(must be Gold...n Genuine Jade...Gems like diamonds n other precious stones are worthless)...vintage mechanical clocks or any antiques...porcelains...valuable paintings...furnitures(not those revamp locally or from China's factory production types) that you have which maybe worth plenty for Orchi...please consider to let Orchi sapu them all...heheh.

Ahem...not camera(s)...cars n electrical appliances...they are just liabilities...

[utellme]

Err dear buddy...some people say...one man's misfortunes is another man's opportunity...

Heheh...should you have n wanna dispose of your rolexs(ORI punya)...jewelry(must be Gold...n Genuine Jade...Gems like diamonds n other precious stones are worthless)...vintage mechanical clocks or any antiques...porcelains...valuable paintings...furnitures(not those revamp locally or from China's factory production types) that you have which maybe worth plenty for Orchi...please consider to let Orchi sapu them all...heheh.

Ahem...not camera(s)...cars n electrical appliances...they are just liabilities...

1.4 mil to sustain - 15 yrs after retirement.

To save enough for 1.4 mil is not easy leh.
"Say easy than do".
I'm 42 years old now and wife is 40 - with 2 kids, the younger is 8 year old
and another 12 more years I will be retired.


Anyway I have started saving, 3 yrs ago and currently monthly saving about RM1800 (myself) and RM600(wife).

With EPF saving - RM 230K and RM225K.
personal saving now - RM 210K

Do I manage to save 1.4 mil when I retired ?

[patrick]

Am I in trouble..... :(

Even now every month it's not enough...mounting debt and unpaid bills...how to save for retirement?? With everything going up..making ends meet is already a chore..at 48 now I can't even make any plans or savings for retirement. How?? :confused:

If indeed what you say is nothing but the truth, then it's because you are living it up like a King! Look at the car you use and the fortune you spend on your cameras, accessories, ITs etc etc. Unca 'Enry, your claim not very plausible lah!!

[patrick]

At my age now, cannot. The bank refuse to give me any load. (loan you mean?)

.

Unca Enry, sure or not? After I retired, they still wanted to give me a housing loan? I didnt take lah! You want the contact?... City Bank..

[Firefly]

ahyoo...unc patrick looks on the surface only...Cam I use is the cheapest in it's class...hopefully can generate some funds with it. A P&S won't do in such an instance....Heard that some companies were willing to pay 10k for shots. So I hope to make such a break.

My cars?? I only own 1. the other is company provided. Me living like a King?? Since when? I eat the leftovers of my kids. Surely you don't call that living like a king??

And Orchi...sorry lah, none of them old stuff around. New mass produce antique looking stuff got. aahhh...just remembered got a RM1000 note..but have seen better times already. Want that?

[patrick]

CAN a 35-year-old Malaysian executive earning about RM4,000 a month afford a comfortable lifestyle after retirement at 55?

Many of us are in the less than RM4000 a month category. How can survive?

My suggestion is to work backwards. At 55, how much do you want to have a month? Then work back to see how much you would need to generate that $X. Then between that principal sum and what you reckon you would have, look at the difference. The difference is the amount you have to make up for. And if you cant, then be practical, shift down your expectation of lifestyle at 55 or start belt tightening NOW!

If you really want to chat more on retirement, then meet up at the next TT and let's talk. I'll try to help those who are seriously interested in retirement planning. But uncle Firefly excluded since he is so "cham" he cant even afford to TT ..........Firefly now caught in a catch 22 !!! ;-)

[Firefly]

yeah loh...so cham already...so what's for dinner? on you tonight??

[orchipalar]

And Orchi...sorry lah, none of them old stuff around. New mass produce antique looking stuff got. aahhh...just remembered got a RM1000 note..but have seen better times already. Want that?Err buddy...thought you said RM500 note...? ya got 2 pieces is it...?

Anywayz...RM1000 note Orchi also...chiak lar...! TT on Orchi lah...

[patrick]

ahyoo...unc patrick looks on the surface only...Cam I use is the cheapest in it's class...hopefully can generate some funds with it. A P&S won't do in such an instance....Heard that some companies were willing to pay 10k for shots. So I hope to make such a break.

My cars?? I only own 1. the other is company provided. Me living like a King?? Since when? I eat the leftovers of my kids. Surely you don't call that living like a king??

And Orchi...sorry lah, none of them old stuff around. New mass produce antique looking stuff got. aahhh...just remembered got a RM1000 note..but have seen better times already. Want that?

Sooo modest lah unca! Wish I had leftovers then I wouldnt be so lean!

RM1000 note? Wahh...impressed. You are so cham, but I am the one who has never even seen a thousand dollar note!!! Strange huh?

[USJ9chin]

This is a hypothetical case. Lets do the calculations for fun . Please pay attention to the Assumptions and person who live in this way is a nut.


This is a hypothetical case. No human will live this way.
One can save up to RM1,610,320.20 at age 55

Assumptions:-

1. Completed tertiary education at 23 years old
2. Starting pay RM1,800.00
3. Last drawn pay at 35 is RM6,000.00
4. Assuming his average pay from 23 to 35 is RM3,500.00
5. Living with his parent until age 35.
6. At age 35 instead of buying a RM350,000.00 house paying instalment
RM2,500.00 per month, he rent a house for RM1,000.00 and save RM1,500.00 every month for 20 years.
7. From age 35 to 55 his average pay is RM8,000.00.( assuming he works very
hard in one company only and the company never go bankrupt)
8. He marries young and has two children go for tertiary education on Loan.
( The working children will service the installment)
9. He drives a old car, no holiday, once a blue moon eat in Mc Donald, he eats
simple. No luxury items in his house. He doesn't own plasma TV, house or shares.

Calculations:-

Age 23 to 35

EPF saving from age 23 to 35 ( 12 years based on monthly contribution of RM770.00 – 22% of RM3,500.00)

Total EPF saving for 12 years will be RM151,508.00 ( 5% dividend)
Compound this amount for 20 years monthly rest until 55 at 4% compound interest.
He will get RM336,739.00

Age 35 to 55

Month saving of RM1,500.00 will get RM550,161.94 at the end of 20 years at 4% interest monthly rest.

Monthly EPF contribution of RM1,760.00 ( 8,000.00 x 22%)
After 20 years he will get RM723,419.26 ( 5% dividend)

TOTAL SAVING AT 55:-

RM 336,739.00 ( EPF)
RM 723,419.26 ( Monthly saving)
RM 550,161.94 ( EPF)
RM1,610,320.20 (Total)

CONCLUSION: THIS GUY IS A NUT

[wsp]

above all, we need to stay in good health during our retirement.
health problems may cost us a bomb although there is an insurance policy.

[patrick]

This is a hypothetical case. Lets do the calculations for fun . Please pay attention to the Assumptions and person who live in this way is a nut.


This is a hypothetical case. No human will live this way.
One can save up to RM1,610,320.20 at age 55

Assumptions:-
..........................

.........CONCLUSION: THIS GUY IS A NUT

Ahhh...but these days in urban areas, many save as a couple with a working wife. Hence, the kitty will be more than your tabulation. Maybe you want to add that factor in?

[PeterHng]

This is a hypothetical case. Lets do the calculations for fun . Please pay attention to the Assumptions and person who live in this way is a nut.


This is a hypothetical case. No human will live this way.
One can save up to RM1,610,320.20 at age 55

Assumptions:-

1. Completed tertiary education at 23 years old
2. Starting pay RM1,800.00
3. Last drawn pay at 35 is RM6,000.00
4. Assuming his average pay from 23 to 35 is RM3,500.00
5. Living with his parent until age 35.
6. At age 35 instead of buying a RM350,000.00 house paying instalment
RM2,500.00 per month, he rent a house for RM1,000.00 and save RM1,500.00 every month for 20 years.
7. From age 35 to 55 his average pay is RM8,000.00.( assuming he works very
hard in one company only and the company never go bankrupt)
8. He marries young and has two children go for tertiary education on Loan.
( The working children will service the installment)
9. He drives a old car, no holiday, once a blue moon eat in Mc Donald, he eats
simple. No luxury items in his house. He doesn't own plasma TV, house or shares.

Calculations:-

Age 23 to 35

EPF saving from age 23 to 35 ( 12 years based on monthly contribution of RM770.00 – 22% of RM3,500.00)

Total EPF saving for 12 years will be RM151,508.00 ( 5% dividend)
Compound this amount for 20 years monthly rest until 55 at 4% compound interest.
He will get RM336,739.00

Age 35 to 55

Month saving of RM1,500.00 will get RM550,161.94 at the end of 20 years at 4% interest monthly rest.

Monthly EPF contribution of RM1,760.00 ( 8,000.00 x 22%)
After 20 years he will get RM723,419.26 ( 5% dividend)

TOTAL SAVING AT 55:-

RM 336,739.00 ( EPF)
RM 723,419.26 ( Monthly saving)
RM 550,161.94 ( EPF)
RM1,610,320.20 (Total)

CONCLUSION: THIS GUY IS A NUT

Thank God it's a hypothetical calculation/planning. Or else where's he and wife/family going to stay when he's old? Keep on renting.. Rent would probably be astronomical by the time he reaches 55 or a small house/apartment would be pricey too.. My suggestion is to make sure the house or apartment is paid up by the time he retires so that by that time he doesn't have instalment at all except the monthly water, electricity & petrol bills.

[USJ27Resident]

CAN a 35-year-old Malaysian executive earning about RM4,000 a month afford a comfortable lifestyle after retirement at 55?

Many of us are in the less than RM4000 a month category. How can survive?

Can... migrate to Indonesia/Cambodia/Vietnam or by changing the Govt...

[fabregas]

This is a hypothetical case. Lets do the calculations for fun . Please pay attention to the Assumptions and person who live in this way is a nut.


This is a hypothetical case. No human will live this way.
One can save up to RM1,610,320.20 at age 55

Assumptions:-

1. Completed tertiary education at 23 years old
2. Starting pay RM1,800.00
3. Last drawn pay at 35 is RM6,000.00
4. Assuming his average pay from 23 to 35 is RM3,500.00
5. Living with his parent until age 35.
6. At age 35 instead of buying a RM350,000.00 house paying .....
........................

RM 336,739.00 ( EPF)
RM 723,419.26 ( Monthly saving)
RM 550,161.94 ( EPF)
RM1,610,320.20 (Total)

CONCLUSION: THIS GUY IS A NUT

Comments :

1) Its unrealistic to depend on EPF and collecting interest on savings in bank. While the person is young, they can be more agressive in investments. I think its possible to achieve 7 -10% return in relatively conservative investments like bond funds, balanced funds.
2) Target to own a house fully before you retire. 2 would be great. I think properties are generally good hedge against inflation.
3) Somebody mentioned 2nd hand cars, - definitely.
4) As your salary goes up (eg. thru promotion), try to maintain the same living standard. It means more savings, and also if you are forced to find another job, you can easily settle for a lower paying job if the need arises. Jobs with high pay are more scarse.
5) I don't normally buy branded goods, but I wouldn't mind buying a mid range product with better quality , durability. I find that RM 100 watches usually last 2 years, whereas a RM200 can last for years (for example). I also buy goods with looks / fashion that can last for years. There is no point buying a shirt that you can only use on certain occassions.
6) Your spouse and your self must have the same financial objective, for obvious reasons. Your kids need to learn up how to manage money well from an early stage.
7) Read up good books on personal finance. (eg. "Millionaire next door")

[CS Chua]

Can... migrate to Indonesia/Cambodia/Vietnam or by changing the Govt...
Westerners are doing that already. They live in these countries for years and some even start life anew with a young wife. ;)
So if one is willing to change, retirement can be good in these countries. Might as well go out with a bang instead of a limp.

[kokomo]

Wow ... looking at the recent few postings, now I began to think, if married late like after 32 - 35 yrs of age and starting a family esp when at that time only we have kids, and when kids is growing till they grow up. We'll be darn old plus having the need to support the kids of their education, pocket money, household and etc etc. That's a lot of money needed even after retirement.

Now if having to start a family right before we hit 30 then suffer for 10 yrs, along the way, am sure things would not be so tight by that time kids also grow up also and the time we retired, kids are already working. Things would be much more at eased I think. :rolleyes:

[LMei]

Wow ... looking at the recent few postings, now I began to think, if married late like after 32 - 35 yrs of age and starting a family esp when at that time only we have kids, and when kids is growing till they grow up. We'll be darn old plus having the need to support the kids of their education, pocket money, household and etc etc. That's a lot of money needed even after retirement.

Now if having to start a family right before we hit 30 then suffer for 10 yrs, along the way, am sure things would not be so tight by that time kids also grow up also and the time we retired, kids are already working. Things would be much more at eased I think. :rolleyes:
ya imagine upon retirement, no more income dy but still hv to pay for kids education, etc. if kids already working upon our retirement, then not so worrisome.

[Firefly]

As long as them kids don't become a free boarder...Some kids would even ask parents for a loan and then innocently forget the paying...then how? Loan to them the retirement funds and then eat fresh air and drink sunshine..:(

[PeterLee]

As long as them kids don't become a free boarder...Some kids would even ask parents for a loan and then innocently forget the paying...then how? Loan to them the retirement funds and then eat fresh air and drink sunshine..:(

One more commitment, if your parents are staying with you, their medical bills and expenses will eat into your retirement fund.

[CCY]

One more commitment, if your parents are staying with you, their medical bills and expenses will eat into your retirement fund.

Definitely true of that and not even staying with now it still eat more than rm700 monthly of my retirement fund ...huh.

[Kiwi]

Definitely true of that and not even staying with now it still eat more than rm700 monthly of my retirement fund ...huh.
I shall start to educate my child to be has a sincere heart like CCY, "now I feeding you, next time when your mama and I get old, you should take care of us also..." :rolleyes: :D

[Firefly]

Good idea...example by seeing.

[pcyeoh]

There is a Hokkien saying "One lau pek (old father) can feed 7 children and yet 7 children cannot feed one lau pek." Don't even talk about lau mak (old mother) How very true as can be seen happening in today's dog eat dog world.

[sly]

how very true....

[in]

Good idea...example by seeing.

My mother had another way.....she told me directly. When I started my first job 17 years ago, she told me that I must contribute to the household. It can be anything, as little or as much as I want, even RM10 or RM20 but MUST contribute. I've been contributing ever since (err...more than RM20 lah...!)

That's another lesson I learnt, don't expect someone to do something .... tell it to them directly!

[patrick]

above all, we need to stay in good health during our retirement.
health problems may cost us a bomb although there is an insurance policy.

wsp has a valid point. When planning your retirement, try to buy your hospital/health or whatever they call it, before you actually retire IF you suspect you may have health problems by the time you retire. And IF you do, the insurance wont touch you even with a ten foot pole. So my advice is buy whist they would have you.

Also when buying hospital policy be careful. Some have low premiums but they dont guarantee you renewal. Usually what happens is once you make a substantial claim, they will reject coverage the next year when you try to renew. But these companies do not spell out their policies clearly. Hence you will never know until you experience it. By which time it will be too late.

However there are some companies which guarantee you coverage until and unless you fullly claim the maximum amount of coverage. In other words if you cover say 200k, even if you claim every year, so long as the total claims dont exceed 200k, they will still cover you. These are the two types of coverage that I am aware.

So you see. In retirement, there's more than that which meet the eyes.

Another issue you dont see until you need it. It you intend to apply for credit cards when you retire for whatever reason. DONT wait till you retire to do it. DO IT before you retire. Once you retire, chances are the promoters will even shy away from you when you say Yes to them! Just like someone mention, if you want housing loan also very susah.