PETALING JAYA: Technician Mohd Ali will reach retirement age in two years, but he isn’t thinking of calling it a day yet.
“I can work as an electrician. I have also considered the option of working as a security guard,” he said.
The 58-year-old father of four, who needs to put two of them through university, said he will continue working to make ends meet.
He has RM300,000 in savings with the Employees Provident Fund now.
“I don’t think I will be able to hit RM360,000. Even if I do, I may not be able to sustain the amount in the long run, what with the inflation and rising cost of living,” he said.
The EPF has outlined a three-tier savings framework, which comprises a “basic savings” level of RM390,000, “adequate savings” of RM650,000 and “enhanced savings” (RM1.3mil).
Basic savings could help cover essential retirement needs. Adequate savings will allow the person a reasonable standard of living during retirement while enhanced savings could offer greater financial security and a higher quality of life.
Based on EPF data, an estimated 21.5% of contributors aged 56-60 would have the basic savings of RM390,000 by the time they reach 60.
About 13% from this age group would amass RM650,000 while a mere 5.2% would have RM1.3mil when they are 60.
An administration staff, who only wanted to be known as Lee, said she is hoping that she would be employed under contract, post-retirement.
“If that does not work out, I plan to start a home-based baking business,” said Lee, 59.
She noted that the elderly would need more funds, especially for medical expenses.
“I have surrendered my insurance policy because of the rising premiums. I will rely more on government hospitals after my retirement,” she said.
“Back in the day, RM390,000 could sustain you until age 85 but now, it is not possible.”
Lee said she is concerned about the rising cost of necessities.
“It is hard to predict based on today’s inflation rate. What would have been enough 20 years ago is small money now,” she added.
A. Muthu, 58, said he intends to work till he reaches the age of 62 or 63.
“I would like to continue working to remain an active part of the workforce rather than sitting at home,” said Muthu, who works in the publishing industry.
Furthermore, he has withdrawn some funds for his daughter’s education abroad.
“I have four more withdrawals to do,” he said, adding that this would leave him with less than RM350,000.
