1 July 2022

Easy tips for a worry-free retirement


No doubt the COVID-19 pandemic has impacted our financial wellbeing with many may require working even after 60 years old. It’s not all rainbows and butterflies upon retirement - there are still many things that can go wrong financially. It’s best to be informed so that you’ll know what to anticipate when you retire.

Here are some pain points and probable solutions that you need to address to sail through the golden years:
1. Short Term Orientation
The minimum retirement age of an employee in Malaysia is 60. The current retirement age suits the average life expectancy of 74.5 years. Roughly, Malaysians are expected to live 15 to 20 years post-retirement. As such, you will still need to grow some of your money and invest a portion on some growth-oriented investments like equity funds.
2. Forgetting About Inflation
Inflation will have a direct impact on your savings and spending power. That means, your retirement funds will need to grow to catch up with inflation, which is why we recommended investing in some equity funds during retirement.
3. Putting All Your Eggs in One Basket
The golden rule on investing still applies during retirement: diversify. Mitigate risk by diversifying your portfolio. Your portfolio should be a mix of different assets, like market investments, bonds or bond funds, and a small portion on equity or equity funds.
4. Spending Too Much, Too Soon
A common behaviour among retirees is they rush into a spending spree. Retirement to others is liberating and the urge to live beyond your means is a very strong temptation. Instead of spending your retirement bonuses immediately, look at how you can use it to get rid of debt (credit cards, car, or home loans) or grow your savings/investment pool.
5. Simplifying Legacy Planning
You probably will need more than just a will. Retirement is a good time to consider some serious legacy planning. Learn about the many ways you can plan for your estate towards a more secure and brighter future here.
TIPS: You can now easily nominate a beneficiary to ensure your loved ones will get your plan benefits via our SunAccess web portal or mobile app.
6. Not Preparing for Medical Emergencies
60 or 65 is still a relatively young age, so the need for medical concerns is not yet taken seriously. However, while the spirit is still willing, the body is not, and it will be good to provide for a time when we will experience physical ailments.
Explore your options for health coverage here to determine how you can have a critical illness insurance to support your overall financial plan.
7. Not Reviewing Finances and Investments
The need to do a periodic review on finances and investments should be on the top of the to-do list for any retirees. While it is not a good idea to worry too much, being too carefree is not a prudent thing to do.
8. Relying On EPF Alone
Many people rely only on their EPF, but it should not be your sole source of retirement funds. A far better way is to amass some level of savings, so you have an additional income source to fall back on. If that's not possible, you can plan to work part-time in retirement to boost your monthly earnings. But the key is to do your best not to limit yourself to EPF alone.
9. Making Risky Moves with Money
While we recommend that a retiree should still be investing, going into high risk or speculative endeavours might not be a really good idea. Retirees need to be more cautious about their investments because they don't have the long-time horizon that younger investors do.
10. Worrying Too Much
Alas, while prudence is key during retirement, fear is a very crippling mindset. Try to relax as this is what retirement is all about. So long as you follow common sense and have done your best in preparing for retirement that could potentially affect your retirement savings.
Looking at your life from a different vantage point can help you find happiness about your future. Here are 7 tips for a rewarding retirement.

Find out how much you would require staying financially protected while enjoying your golden years with our handy Retirement Calculator HERE

Talk to our advisor now to help you make the bright financial moves so you can be prepared to deal with life’s uncertainties and be protected for a brighter future.

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