“ The average EPF contributor’s have only RM 94 000 at age 55” - Personal Money, 2004
“ An average EPF contributor would have exhausted 70% of their retirement benefits in just 10 years”. – Personal Money, 2007
Example:
Name : Mr. Raul
Retirement age : 56
Retirement Fund in hand : RM 500 000
Monthly Expenditure : RM 5 000
Retirement Annual Expenditure : RM 60 000
Inflation rate during retirement : 2.5% annually
Return from Fix deposit (FD) : 4% annually
Life Expectancy : 79 years old
From the details above clearly Mr. Raul has more then what an average EPF contributor’s have by the time he retire. Now let us see if the fund that he has can last through out his retirement year.
|
AGE |
RETIREMENT FUND
(RM) |
INFLATION ADJUSMENT WITHDRAWAL
AT 2.5%
(RM)
|
RETURN FROM FD AT 4%
(RM) |
BALANCE
(RM) |
| 56 | 500 000 | 60 000 | 17 600 | 457 600 |
| 57 | 457 600 | 61 500 | 15 844 | 411 944 |
| 58 | 411 944 | 63 037 | 13 956 | 362 863 |
| 59 | 362 863 | 64 613 | 11 930 | 310180 |
| 60 | 310180 | 66 228 | 9 758 | 253 710 |
| 61 | 253 710 | 67 884 | 7 433 | 193 259 |
| 62 | 193 259 | 69 581 | 4 947 | 128 625 |
| 63 | 128 625 | 71 321 | 2 292 | 59 596 |
| 64 | 59 596 | 73 104 | - | - |
A MERE 9 YEARS ONLY!
So in case of Mr. Raul sadly his retirement fund clearly do not enough to cover his retirement days. Now ask your self, have you plan for your retirement? Will it be enough for your retirement? How much is enough to retire? SO START PLANNING!
IF YOU FAIL TO PLAN, YOU PLAN TO FAIL
Sheyzal Azman,
Financial consultant
sheyzal@yahoo.com
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