IT is not surprising that many Malaysians end up with insufficient savings or pension to rely on upon retirement. In general, while mandatory plans offer an excellent foundation – we often do not save enough and those savings are also used for other purposes such as a home loan, children’s education, personal education loan settlement, and more.
It cannot be stressed enough: It is never too late to start planning and investing for your retirement. As Malaysians, we have opportunities to invest for retirement through top-ups to EPF savings, Private Retirement Schemes (PRS) and other forms of investment.
Munirah shares her tips on savings and investing.
Munirah Khairuddin, chief executive officer of Principal Asset Management, explains, “Investment literacy among Malaysians must be improved and digital platforms are the fastest and best way to increase awareness, more so amongst millennials who are digitally savvy and make most of their decisions on digital platforms.
Millennials must start investing early in life for better returns as a result of compounding effect.
“In August 2019, Principal, among many other fund management companies, launched the EPF i-Invest platform, which allows EPF contributors to access their Account 1 savings and invest in unit trusts.”
Munirah shares her tips on savings and investing, saying, “Start small and put regular savings of RM100 to RM250 every month into your PRS account and in 20 years, depending on the compounded annual returns, you could potentially have up to RM150,000. What’s important is to have a long-term view, so you really do not need to worry too much about markets’ short-term volatility. Just focus on setting aside those regular monthly savings and invest more, whenever you have extra cash, to build your future nest egg.
“Over time, through the concept of dollar-cost averaging, getting more units when prices are lower and fewer units when prices are higher, over many years, the net price per unit tends to be moderated and you tend to gain from the compounding effect of your funds.”
Savings and unit trust are assets that can be easily liquidated, while PRS savings can be taken out but subject to a withdrawal fee. You have to make your cash work harder for you and that’s where investments and savings can play a role in multiplying your wealth. The younger you start, the better returns you will enjoy as a result of compounding effect.
Working with an asset manager such as Principal can help you reach your long-term financial goals. In business for over 140 years in markets around the globe, Principal has the expertise to help. Plus, you have the added benefit of knowing that Principal, as a PRS provider, is monitored by the Securities Commission of Malaysia.
For tips and guidance on how to get started saving for retirement, call 03-7718 3100 or visit www.principal.com.my or the Facebook page @PrincipalAssetMY.
Disclaimer: The information in this document has been derived from sources believed to be reliable, however, we do not independently verify or guarantee its accuracy or validity. It contains general information only on investment matters and should not be considered as a comprehensive statement on any matter and should not be relied upon as such. The information it contains does not take account of any investor’s investment objectives, particular needs or financial situation. Investors should consider whether an investment fits their investment objectives, particular needs and financial situation before making any investment decision.
The data presented is for information purposes only and is not a recommendation to buy or sell any securities or adopt any investment strategy. This material is not intended to be relied upon as a forecast, research, or investment advice regarding a particular investment or the markets in general, nor is it intended to predict or depict performance of any investment.
All expressions of opinion and estimates in this document are subject to change without notice. This document is not intended to be, nor should it be relied upon in any way as a forecast or guarantee of future events or investment advice regarding a particular investment or the markets in general.
