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Something to share with you... semoga menjadi pembuka mata dan minda kita :)
Not Saving Enough & Spending Savings Early
There are 46% of Malaysians say they have saved for retirement, but they
have accumulated only very small amount.
We recommend that individuals save 11% - 15% of income over an
entire working career, If you start later, that is going to be higher.
Spending Savings Early
Retirement fund is not compulsory and many of them
forgo the long-term advantages for short-term
gains. Most of the individuals tend to face self-control
problem and thus, cash out their retirement savings in
advance and either spent the money or used it to pay
down debt. At times, they essentially delay joining the
retirement funds because they want to spend the money
now.
Rising Cost of Living
Saving for retirement is often put on hold as a lot of individuals
struggle to pay for current expenses. Day-to-day cost of living is a
major reason they do not contribute (or contribute more) to their
retirement plan. In fact, putting off saving for retirement will make
the problem of financing retirement even worse.
Too much debt
It’s extremely difficult to save for the future when an individual is still
striving to pay off past costs, especially for those who indicate their
current level of debt is higher than it was 5 years ago.
No Emergency Fund
An emergency fund is an important tool that allows you to avoid
dipping into your retirement saving for a sudden expense.
However, there is only a minority who is able to come up with an extra
amount of money if an unexpected need arose within the next month.
Don’t Know How Much To Save
Most individuals set lofty retirement savings goals for themselves. To
achieve a financially secure retirement, many of them would need to
save between 20% - 30% of their income or more! However, when
asked for the value they would need to retire well, many of them may
have not tried to do a systematic retirement needs calculation.
The fact is, by doing the calculation, it may definitely help to increase
an individual’s savings rate.
Unpredictable Health Care Costs
There is a great number of individuals doubt their ability to afford
retirement medical expenses and especially long-term care costs.
Some individuals may be waking up to the realization of just how much
money is needed to secure a comfortable retirement instead of including
the retirement healthcare costs.
False Expectations
Many people aspect they will be able to spend less money in retirement
than they do now. But not everyone is able to cut costs, and one may
encounter new expenses in retirement which make him or her
experiences an increase in spending.
Unexpected Retirement
Delaying retirement gives you more time to save and reduces the
number of years your savings needs to last. But few retirees actually
manage to delay retirement. Individuals should plan for the fact that
they won’t be able to work in retirement. However, there is a great
number of retirees often say they retired unexpectedly, often due to
health problems or disabilities, a downsizing or business
closure, or having to care for a spouse or other family member.
Source: The Star Online & US News.com
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