Challenges in Retirement Planning

With the advancement in healthcare innovation and technologies people tend to live longer. According to Department of Statistics Malaysia, males and females who reach the age of 65 are expected to live another 14.8 and 17.1 years respectively. Thus, males aged 65 years is expected to live until the age of 79.8 years and 82.1 years for females.

Living longer may be a challenge for us if we do not plan ahead financially because upon retirement many of us do not have a recurring income we used to be during employment. This is the time we solely depends on the nest eggs we had saved or some may rely on their children for financial support. Don’t you agreed self help financially is always better than demanding for help from others ?

However many Malaysians faced challenges to retire comfortably due to lack of savings and rising medical costs which further amplified by higher expectancy, slow economic growth and lower than expected interest rates. According to Employees Provident Fund (EPF) contributions, 54% of contributors age 54 have less than RM50,000 in their account. And more than 80% of EPF contributors do not meet the minimum savings target of around RM240,000 by retirement age.

What are the options do we have facing the unexpected lower interest rates ? Probably we need to revise our financial portfolio to adjust it according to the current market situation.

Diversifying into endowment plans can be a good option. Endowment plan aims to give us certainty of time when other investment portfolio fail us. It can ensure that funds were being delivered to us irregardless of market condition. Endowment plan provides a combination of guaranteed annual payouts and non-guarantee bonuses.

Besides, one can consider Universal Life saving plans. This type of plan gives a periodic payment feature and monthly return which can help to boost your current cash value and the effect of compounding interest. Both plan can potentially generate higher return than FDs, help to build a discipline way of saving and able to provide certainty of time.

Start your retirement saving with Great Flexi Wealth, a universal life endowment plan which help you to save while assuring that you are well protected. Besides, you can opt for our endowment plan, Great Premier Wealth 3 which provides you short term commitment with long term gain. For more benefits, download our brochure now. Otherwise, you can leave us your contact info.

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