I REFER to "92% of M'sians worry about retirement: BNM (Sunbiz, Aug 11). The statistics from the Employees Provident Fund (EPF) are alarming: 68% of its members aged 54 in December 2014 had less than RM50,000 in their EPF accounts.
Another 12% have only between RM50,001 and RM100,000. A staggering 80% have not more than RM100,000 as their main retirement fund. This is a disturbing fact, especially as the average lifespan of Malaysians has increased to 75 years.
A retiree having RM100,000 in his EPF account would only live on a miserable RM208 a month.
Retirement planning is critical. Yet most employees see retirement planning as a subject of no interest or least interest. Perhaps the rampant increase in cost of living has played its part. People are more focused on monthly and short-term savings or financial goals.
Another contributing factor is not having the time to plan or lack of exposure to retirement plans.
Looking from a holistic perspective, employers or human resource managers play a crucial role in providing the platform for retirement planning. Generally, employers perceive that retirement planning is something personal to the employees.
Therefore it has nothing to do with employers, at all. But is that true? Is this thinking allowed in today's world?
Bank Negara Malaysia said that most Malaysians adopt a passive strategy for retirement: 42% prefer to buy properties; 25% opt to save money; and another 18% depend on just EPF.
EPF is not sufficient to sustain life after retirement, at least for a big majority of EPF contributors.
Other kinds of retirement plans such as the Private Retirement Scheme, unit trusts, and other retirement investment plans approved by the Securities Commission are suitable long-term wealth accumulation schemes which should be shared with every employee.
Employers can also help employees to plan for retirement by signing up for corporate retirement plans. The employer-based plans, which can relate directly to PRS should work well as additional funds for a better retirement plan for employees at all levels.
Employers must be able to play the role of a strategic partner to the employees.
They should look at retirement planning as a subject of interest to both employers and employees as it is going to be a win-win situation. Good retirement plans are potent retention tools. Employers need to understand how important their role in advocating the benefits of retirement planning for employees and what they can do to encourage participation.
Town hall sessions, smaller group presentation or even exhibitions by wealth specialists is an ideal way to introduce retirement planning to employees. Wealth specialists should be seen as strategic partners to employers.
Employers must play a significant role to reshape the social landscape of the employment scenario in Malaysia.
The goal is to have a healthy, well prepared and wealthy retirement scheme. The government should also encourage employers by giving tax-incentives to enhance and address the larger issue of lack of retirement benefits among its working population.
Syed Zulbakri Syed Jemal Shah
Bandar Puncak Alam
Another 12% have only between RM50,001 and RM100,000. A staggering 80% have not more than RM100,000 as their main retirement fund. This is a disturbing fact, especially as the average lifespan of Malaysians has increased to 75 years.
A retiree having RM100,000 in his EPF account would only live on a miserable RM208 a month.
Retirement planning is critical. Yet most employees see retirement planning as a subject of no interest or least interest. Perhaps the rampant increase in cost of living has played its part. People are more focused on monthly and short-term savings or financial goals.
Another contributing factor is not having the time to plan or lack of exposure to retirement plans.
Looking from a holistic perspective, employers or human resource managers play a crucial role in providing the platform for retirement planning. Generally, employers perceive that retirement planning is something personal to the employees.
Therefore it has nothing to do with employers, at all. But is that true? Is this thinking allowed in today's world?
Bank Negara Malaysia said that most Malaysians adopt a passive strategy for retirement: 42% prefer to buy properties; 25% opt to save money; and another 18% depend on just EPF.
EPF is not sufficient to sustain life after retirement, at least for a big majority of EPF contributors.
Other kinds of retirement plans such as the Private Retirement Scheme, unit trusts, and other retirement investment plans approved by the Securities Commission are suitable long-term wealth accumulation schemes which should be shared with every employee.
Employers can also help employees to plan for retirement by signing up for corporate retirement plans. The employer-based plans, which can relate directly to PRS should work well as additional funds for a better retirement plan for employees at all levels.
Employers must be able to play the role of a strategic partner to the employees.
They should look at retirement planning as a subject of interest to both employers and employees as it is going to be a win-win situation. Good retirement plans are potent retention tools. Employers need to understand how important their role in advocating the benefits of retirement planning for employees and what they can do to encourage participation.
Town hall sessions, smaller group presentation or even exhibitions by wealth specialists is an ideal way to introduce retirement planning to employees. Wealth specialists should be seen as strategic partners to employers.
Employers must play a significant role to reshape the social landscape of the employment scenario in Malaysia.
The goal is to have a healthy, well prepared and wealthy retirement scheme. The government should also encourage employers by giving tax-incentives to enhance and address the larger issue of lack of retirement benefits among its working population.
Syed Zulbakri Syed Jemal Shah
Bandar Puncak Alam