This article was originally published in February 2012 by GenX at http://www.ringgitwisefool.blogspot.com with the title Investment Wealth Retirement. The article was then shorten by the original author, i.e. yours truly, and republished at http://www.generationsxyz.blogspot.com. But both these said old blogs of mine at blogspot have been compromised with ads/scams and are deemed unsafe by me and google too.
So, I am republishing it here at GenX GenY GenZ Dotcom where all previous links to my old blogs removed and replaced with new links PLUS I also added new contents.
Today I will share with you guys the need to invest for retirement, but before I proceed any further I would like to stress that I am not a qualified financial consultant nor have I received any formal education in regards to investment nor have I any working experience in a financial institution. I am basically just writing my experience and thoughts and therefore just read for leisure and maybe you can learn something from it. This post is kind of for those who do not know how to save money or where to begin their investment journey.
In my post titled GenX GenY GenZ at my old blog (link removed), I mentioned the following:
Prior to 1998, our economy was booming like nobody’s business and it was “easy” for Gen X to accumulate wealth where things were still relatively cheap compared to today. The younger Gen Y will find it harder to accumulate wealth with inflation taking its toll especially since most of them are into material stuff, thus spending their money away (with easy credit facilities being offered by banks and merchants which many don’t understand that they need to pay from their future earnings) than learning how to invest and make more money.
The average lifespan of Malaysians have increased over the years to about 75 years old. I guess the average lifespan will continue to increase with time with better health care and new medical findings.
And in my posts titled Currencies Rolex No.8 at Ringgit Wise Fool (link removed), I gave an example on inflation where the same Rolex watch price has doubled that of 10 years ago and in my previous post titled Climate Disaster Prophecies, I mentioned how nature plays a role in inflation especially on food prices.
In my post titled GenY KPop Cakes (link removed), I gave examples on how I pamper my children with unproductive stuff and of them spending money as if my “backside Photostat money”. Many children nowadays are spoon fed where they are guided day in day out on their school work with tuition. That’s why so many of you GenY need to be spoon fed by me, hahaha.
With our lifespan getting longer, we would need to accumulate wealth early in our younger days in order to have prosperity later in life. But with the practice of live now earn later, we may not have adequate wealth later in life to enjoy longer period of prosperity with our longer lifespan. The road towards accumulation of wealth is also hampered by inflation which is also unpredictable like the weather.
Now take note of this, the average lifespan of a Malaysian now is at about 75, it means that half the population of Malaysia will live beyond age 75. The official retirement age now is about 60. I have mentioned in my previous posts that with new technology in the medical field, our lifespan will increase in the future. For discussion’s sake, let us assume one retires at age 55 and lives up to age 80, that’s 25 years or a quarter of a century after retirement where one needs an income to sustain his/her expenses.
The sooner you start to accumulate wealth the better so that there will be adequate retirement funds to ensure you get to continuously enjoy prosperity until the day you die. So what I am trying to do today is to highlight to the younger generation by telling them about my experience and to make them aware of the importance of accumulating wealth early in life and hopefully they will start to think and invest for their future instead of practicing live now earn later.
This article is kind of long, you may want to bookmark this page now so that you can come back and refer to it again later when you have some time to spare.
Well if you are a salaryman, then you would be contributing to EPF monthly.
On 30th September 2016, EPF announced that they have set the minimum target of RM228K for their members when they retire at age 55. Click here to read about it at Free Malaysia Today.
When I first published this article back in 2012, EPF policy back then was to ensure that we maintain at least RM120,000 in your EPF Account when we retire. In a matter of 4 years, EFP has increased the minimum target by RM100K!!!
Have you ever wondered, with inflation, will RM228,000 be enough for you to survive for the next 25 years?