THE way Malaysians think about retirement is changing. Unlike previous generations, more and more Millennials are looking into different plans for ageing and relying less on their children or families for care in their senior years.
This has a lot to do with shifting demographics and social realities.
Malaysia officially became an ageing nation in 2021 when the proportion of citizens aged 65 and above reached 7% of the total population. By early 2026, that figure had risen to 8%. We are projected to become an “aged nation” by 2048, when the proportion of citizens aged 65 and above reaches 14%.
Fertility has also declined sharply across all ethnic groups, reaching 1.67 children per woman in 2025 and remaining below the replacement rate of 2.1 since 2013. Meanwhile, the average household size has shrunk from 5.5 people in 1970 to 3.7 in 2025.
In short, families are becoming smaller, with many adult children emigrating for education and employment. Additionally, more individuals are remaining single, marrying later, or choosing not to have children.
“As a result, older adults can no longer assume that family members will be available for daily care,” says Assoc Prof Dr Ponnusamy Subramaniam, who is head of Universiti Kebangsaan Malaysia’s Clinical Psychology and Behavioural Health programme.
While filial responsibility remains a key cultural value, Prof Ponnusamy explains that many middle-aged Malaysians now recognise the importance of preparing for ageing in ways that preserve their independence and reduce the burden on loved ones.
Planning for later life
As more Malaysians prepare earlier for retirement, many are realising that health and quality of life are just as important as financial security. Prof Ponnusamy says successful retirement planning requires a holistic approach, beginning with physical and mental healthcare through nutrition, exercise, cognitive stimulation, and other preventive healthcare measures.
Housing is another key consideration, with safe, accessible homes that can accommodate changing mobility. Future caregiving arrangements and legal matters such as advance care planning should also be taken into account.
Prof Ponnusamy stresses the importance of maintaining strong social connections to reduce loneliness and having a sense of purpose through volunteering, hobbies, or part-time work.
“Malaysia is expected to become an aged nation within two decades. This requires supportive public policies, such as investment in community-based services and affordable long-term care.
“Individually, planning should begin in midlife to build the resilience and care plans necessary for dignity and independence in later life,” he says.
Is Malaysia prepared for ageing?
According to Universiti Putra Malaysia’s Malaysian Research Institute on Ageing (MyAgeing), households with at least one child below 18 fell from 67.3% in 1999 to 47.9% in 2024. In the same period, households with at least one older person aged 60 and above grew from 23.3% to 43.2%.
“I know we are mostly fixated with older persons living alone, but the real increase is in households with only older persons, or empty nests where older couples live together.
“We don’t automatically see this as a vulnerability issue, but we believe ageing in place preferences have remained consistent among the elderly in past major surveys,” says MyAgeing senior research officer Chai Sen Tyng.
Chai says falling birth rates are only part of the picture.
“Our urgency stems not only from shifts in fertility patterns and values of filial piety, but also from cost-of-living issues and a market economy that necessitates dual-income households to sustain modern comforts and consumption patterns,” he says.
These changes point to a need to develop more products and services for retirement pensions and long-term care, says Chai, adding that not all of these can be sustained solely by the government.
Chai observes that most Malaysians still rely on family support and out-of-pocket spending on long-term care. This is particularly concerning because data shows that only 39.5% of Employers Provident Fund contributors could meet the new basic savings threshold of RM390,000 when they reach 60.
Because pension coverage is also limited, Chai warns that Malaysia also faces an affordability issue even if the Care Economy takes off well.
“The reality at this moment for Malaysia is that we don’t have the proper range of integrated care services, let alone long-term care financing mechanisms. Even our pension reforms are not happening fast enough to address weaknesses in the retirement savings plan.
“So I would say public aspirations have grown and private services are mushrooming to meet demand but the regulatory framework, enforcement, and financing mechanisms are still trying to catch up,” he says.
Chai also notes that inflation means any retirement savings target set today may not reflect future purchasing power. That makes it even more important to expand affordable retirement facilities, long-term care services, and financing options.
Staying healthy and delaying disease and disability remain important safeguards against needing long-term care too early. At the same time, Chai says that reforms must be initiated so that services can be accessible to B40 (lower) and M40 (middle) income groups without bankrupting the family.
Preparing for old age also requires honest conversations, managing expectations, and finding meaning in life after work. Oftentimes, people leave too many things unspoken and undetermined in later life, and many fail to plan for end-of-life issues, says Chai.
But ageing is not just for older persons to address. It is something that must be considered much earlier.
