In Oct 2015, I was reading this article 'Having enough for retirement' on The Star Online. It is worrying that most of KWSP contributors on the verge of retirement do not have enough savings for their retirement. This is also a sad situation that 68% of this group has less than RM50K KWSP savings. With some simple calculation - RM1000 for every month, RM50K can only last for 50months which is slightly more than 4 years. How about the life of these retiree after 4 years?
One of the many reasons for this insufficient retirement fund is limited financial literacy among the contributors. Most contributors were not aware of the impact of limited fund for retirement and the importance of retirement planning. With proper financial literacy, contributors should be able to plan ahead for their retirement at a younger age.
The other reason will be low salary package of the wage earners. With about 23% deduction from monthly salary, with estimation of 30 years of working years, the total savings should be quite a huge amount and should be enough to cover the next 20 years of retirement. But, with low salary package, this 23% savings is not going to produce a good amount for a financially-worry-free retirement.
So, are you having enough for retirement? Let us take some time from our busy schedule and evaluate our retirement planning.