For many of us, retirement is an unnerving event and not something we often prioritise. We look at our EPF and savings, and we often wonder, “will this be enough? “, “can I retire comfortably“, “what if I don’t have enough saved up?“.
If you’ve asked any of these questions before, don’t worry, you’re not alone. Don’t fret though, regardless of how old you are, it’s never too late to start thinking about and saving for your retirement. That’s why we’ve taken the liberty to ask a few retired Malaysians how they were able to retire comfortably so that you can pick up a thing or two:
1. “Separate your income into different spending categories and STICK TO IT” -Sarah Lee
Many people today do keep track of and jot down the things they spend on but very rarely do you find people putting a limit to their day-to-day spending. One thing that helped Sarah was to split her income into different categories in order to limit herself from overspending. For instance, her net income was split into:- 50% for basic necessities (food, bills, transport, etc.)
- 10% for insurance savings plans and medical bills
- 15% for investments (stocks, property, unit trust, etc.)
- 25% savings
It may not be easy, but if you stick to it, you will see your savings grow and it helps you avoid splurging unnecessarily. But of course, if you’re not that financial/investment savvy, we have alternative options below.
2. “Use your salary to buy ONLY what you need, and find a way to earn some side income to buy what you WANT” – Tan
According to Tan, it’s important to segregate your earnings to make sure you don’t spend on worthless things. Your main income should only be used for things you need such as electricity, transport, food, and other necessities. If you want the latest smartphone or laptop, for instance, find other means of earning it. “I used to be good at Chinese calligraphy when I was younger, so I joined many competitions. I used the money I won from those competitions to buy things I wanted.”
3. “Increase your EPF contribution and look out for other retirement plan options” – Jerry
Depending on your line of work and position, the amount you save up in your EPF may either be just enough or far from it. This isn’t taking into account any emergency medical or household bills you might need to fork out. This is why it’s important to save more in your EPF by increasing your monthly contributions but at the same time, you need to look for other means of saving for your retirement too, like getting an insurance savings plan.
4. “Never just let your money or savings sit around in your bank account” – Ainsley
Consider investing in real estate, the stock market, businesses, and more. But, if you’re not into investments, the least you can do with the money in your account is put it in an insurance savings plan. That way, albeit slowly, your money still grows even without you doing anything.The beauty of an insurance savings plan is that it not only allows you to accumulate savings for retirement purposes but also protects you and your family from life’s uncertainties.
If you’re interested, why not give an insurance plan like Hong Leong Assurance’s HLA Wealth Booster a try for retirement planning? This investment-linked insurance plan also comes with life protection and a savings element.
If you’re considering applying for the HLA Wealth Booster, here are some of its key features:
- The plan allows you to invest in a range of funds, namely the dedicated HLA Horizon Funds, which comes with the following benefits:
- It secures your savings. Protect your savings from market downturns at Fund Maturity by having Guaranteed Minimum Unit Price at Fund Maturity
- It boosts your savings. Accumulate higher potential savings by capitalizing from higher exposure to investment markets
- You can save more and gain more. Enjoy at least 2% extra allocation for the first three years with a premium of RM12,000 and above per annum
- You can accumulate added savings. Enjoy extra 5% allocation every five years starting from policy year 10 if you choose a premium payment term of 15 or 20 years
So, whether you’re still in university, or maybe you’re already in your forties worrying about retirement, remember that it’s never too early or too late to start!
Find out more about the Hong Leong Assurance Wealth Booster plan here!