Friday, October 15, 2010


The world is ageing. This shouldn't come as a surprise, with birth rates falling and life span increasing in countries across the globe. By 2018, there will be more 65-year-olds than those under 5. Think for a minute the profound changes an ageing population will have on the economy, for example. With the exception of a few, most countries don't seem terribly alarmed by the global ageing phenomenon. That is cause for serious concern.

Governments need to be spurred into action. They need to put in place policies that will sustain the needs of a rapidly growing older population without over-taxing the contributions of the young people. It's a delicate balancing act.

Baby boomers are probably the last generation to have it good. It's the Generation X, Y and Z that will end up with the heavy burden of supporting not only their children but their parents on both sides and two sets of grandparents as well.

Do the maths:
  • 2 children (minimum)
  • 2 (the married couple)
  • 2 + 2 (the couple's parents on both sides)
  • 2 + 2 (the couple's grandparents on both sides)
That makes a grand total of 12 family members to support! This should scare the living daylights out of young people today, and get them started on retirement planning right away.

The alarm bells have sounded. The message is loud and clear. It's not only our adult children who will have to start planning early for their retirement, but we too. It's never too late. We can no longer take it for granted that our children will look after us in our old age. They may not be able to. We must be prepared to fend for ourselves.

Work as long as we can, and save as much as we can. Have enough put aside to see us through the next 20-30 years. And how much is enough? A retired couple living in KL or PJ would require an average of RM2000+ a month to live decently. And pray for good health too. Medical expenses will kill us faster than old age. 

The French should be rejoicing, not protesting against their government's decision to raise the retirement age from 60 to 62. In Malaysia it's still 55 for the private sector, and 58 for the public sector.

The Centre for Strategic and International Studies (CSIS) launched the Global Aging Preparedness (GAP) Index yesterday. You can download a copy of the report here.


Pak Idrus said...

If you had plan well; that is your house are all paid up, your kids out of college and working, No debt whatsoever, you have a pension or EPF, your parent has gone or living with you or on their own. I believe with just RM1000 a month you could live comfortably and enjoy life. If you have more the better.

Have a nice day.

seniorsaloud said...
This comment has been removed by the author.
seniorsaloud said...

Ah, Pak Idrus, if only more people were like you (and me!), then retirement would truly be something to look forward to - a well-deserved rest after long years of hard work and responsibilities.

Unfortunately, young people today are very much into instant gratification. Credit cards, budget flights, latest gadgets, fine dining, etc all lure young professionals into parting with their money. Before they know it, bang -they are 60 and looking at a bleak future.

Anonymous said...

Are you getting another RM500 !?