Better ‘save’ than sorry, M’sians urge

CEO: Ensure you have funds to last for at least 20 years upon retiring at age 60

By CHONG KAH YUAN
kyuan@thestar. com.my

MANY Malaysians  hope  to retire by  60 but  they  are  being held  back  due  to  the consideration  that  their  retirement  fund may  not  be  enough.

Private  Pension Administrator  Malaysia (PPA)  CEO Husaini Hussin  said  Malaysians needed  to have  sufficient  retirement savings  to last  at least  20 years  considering that  the  average  life span  of  Malaysians were  about  75.

“Assuming that  you  retire  early  at  40, you  need  to ensure  that you  have  enough to last  around  40 years,  taking  into consideration  the  inflation rate,”  he  told the  audience  at  a  ‘Top Up Your  Life’ with Private Retirement  Schemes  (PRS) talk  at Sentral  College in Penang  recently.

Husaini  said topping  up  one’s  account  is to invest  in the  ‘future’  or to  go further  in life, a mentality which  should  be  emulated by  saving up  every month  through  the  PRS.

“Little top ups every month can lead to savings that can sustain one for years.

“If you  look  at your  payslip,  about  23% goes to the  Employees  Provident  Fund (EPF), out  of which  12%  is contributed  by the  employer  and  11% by  yourself.

“To maintain  your  living  standards, you  need  to  save  one-third  (33%)  of  your current  pay  every  month. PRS,  a long-term voluntary  savings and  investment  scheme  designed  for  retirement,  is to bridge  the  gap  of  the additional  10% needed,” he  said,  adding that  PPA is the  central  administrator  for the  PRS.

Husaini  said  PRS had  275,000  members  nationwide  since  it was  launched  in  2012 with  27% below  the  age  of  30.

“There are eight approved PRS providers offering 56 types of funds.  We are targeting a 25% growth for next year.”

Participants having fun in an interactive activity.

Kenanga  Investors  Berhad  Learning and  Development  vice president  Alan Chew  said  Kenanga, which  is  among  the  eight  approved  PRS providers,  said PRS is  a form  of ‘safety net’ for the future to  cope with  the  rising living  and  medical costs.

He urged  young workers  to make  the most  of their youth  and  save under  the PRS Youth Incentive  scheme  for  those aged  between  20 and  30.

“Under this scheme, those who save RM1.000 in PRS would receive a one-off RMI, 000 from the Government.

“It is important to select a retirement fund which is highly regulated.  PRS investments are held under a trustee approved by the Securities Commission.”

M. Bushan, 28, who was among  the participants  at  the  talk,  said  the  PRS Youth Incentive  is  a form  of motivation  to  start his  saving  in  PRS.

“I wished  that  I had  knew  about  the fund earlier  so  I could  get  a head  start  and  earn the  compound  interest.

“I started  last year  and  I decided  to open  an  account  for my brother  who  is turning  21 to  safeguard his interest,”  said the  corporate  trainer.

The talk was  organised  by  Star  Media Group  and  supported  by the  Private Pension Administrator  Malaysia  and Kenanga  Investors  Berhad.  Five participants also received RM500 each in PRS units at the talk.

 Source: The Star
Date: Tuesday, 21 November 2017