Retirement is an inevitable moment in our lives. But do we really prepare for it? I’m not ready yet as my fund is still not enough to retire but I hope I could retire as early in 45’s or before 50.
Most of us not really ready to retire. The following are examples of misconceptions that people have about retirement.
Thinking Employee Provident Fund (EPF) is enough for retirement
According to EPF’s 2013 annual report, about 70,000 of its active members (at 54 years old) have an average savings of RM167,000.
EPF statistics state that 68% if nenvers at age 54 – have savings of less than RM50,000. The basic savings quantum that EPF recommends for members at 55 years is RM196,800.
Thinking commitments will get lesser when retire
Many people retire just about the time when their children are about to pursue their higher education. This expenses will be expensive when we have a few children. A retired person may not necessary adapt to the initial thought-off planned retirement lifestyle, compared with the one he enjoyed during his pre-retirement years.
Thinking children will help
In this era, sometimes children used to be the economic fallback for parents when they are old. Coupled with affluent lifestyle living and inflated cost of living, children are not in a position to support their parents in their retirement years.
Parens should not expect physical welfare to be the prerogative and priority of children during the former’s retirement years. Be prepared, in mind and heart, to stay either in a retirement home or a nursing home in later years of retirement when you’re not able to take care of yourself.
Many retirees forget in inflation, which will erode the value of your money over the years. Even if you’re accurately underestimating your costs in retirement, it’s difficult for many pre-retirees to accurately gauge the impact inflation will have on those expenses. At an average 3% rate your costs will double every 10 years. Failing to factor that into your savings can have a disastrous impact on your ability to maintain your lifestyle.
– StarBiz The Star
How about that? I think most of us not pay attention about this point. Don’t think it is easy in retirement age. Hopefully I could save more in my fund and maybe become a millionaire in the future.