TO WORK OR NOT TO WORK AFTER 65? DO WE REALLY HAVE A CHOICE?

Who in their right mind would want to continue working upon reaching retirement age? After spending the best years of our lives working hard for others just so we can feed the family, most of us can't wait to clock out for good.

No more daily stress of a 9-5 job. The sheer joy of waking up late, and spending the rest of the day doing what we like. Time is our own, and we can finally withdraw all our savings from the EPF/CPF to spend as we like.

Life can't possibly be better than this. No wonder the retirement years are aptly called the golden years.

Yet, in a simple survey carried out by the Straits Times recently, 70% of the 50 workers aged 55+ said they would want to keep on working.

Straits Times, 3 May 2014

A good friend of mine is a strong advocate of full retirement after 55. He feels that retirees should not seek re-employment. They should just enjoy life to the full. For many that would mean playing golf, travelling, picking up new hobbies and spending time with the family.

Sure, we all deserve the good life upon retirement, don't we? But sad to say, many of us, especially those from the middle income bracket, can't afford to simply stop working. What happens when the pay check stops coming in? Who will take care of the bills for utilities? Who will pay for our children's postgraduate studies? Who will foot our elderly parents' medical expenses? Who will keep up with the mortgage payments and the insurance premiums?

And what about the rising cost of food and fuel? Inflation eats into whatever little savings we have.

We may live longer now thanks to better healthcare and advances in medicine, but longevity can be a bane for those who do not have adequate savings to support 15-20 years of retirement.

It's a growing worldwide trend for older workers to seek re-employment after retirement.

If your company offers to re-employ you in a different capacity, or extend your contract after you have reached retirement age, would you accept the offer?

I bet the answer for many of us is YES. We really don't have much of a choice.

You might want to read the following related article:

WORK BEYOND 65? WHY NOT?

TO WORK TILL 60 OR RETIRE EARLY? YOU DECIDE

Still active and able to carry on working at 60+.
(Front page article of New Straits Times Dec 8, 2012)

So it's confirmed. The Minimum Retirement Age 2012 Act comes into effect on July 1, 2013. Under this Act which was passed in August last year, it is mandatory for employers in the private sector to retain their staff till they reach the new retirement age of 60. This move will affect close to 11 million workers.

Good news or bad news?

That depends on who you pose this question to. Employers in the private sector aren't exactly celebrating the news. Retaining older workers for another five years means higher pay-outs compared to hiring new and younger workers at a lower starting pay. Even among workers, not everyone is jumping for joy. Some have already made plans to retire at 55 and pursue other interests. Others can't wait to clock out for the last time and enjoy their golden years.

Dwindling value: RM1m won’t be sufficient
to retire for long.

Frankly, except for the few who have wisely planned ahead for a financially secure retirement, most people have little choice but to carry on working for as long as they are physically and mentally able to do so. Their EPF savings and pensions are simply not enough to see them through the next 20+ years given the average life expectancy of 75. Financial experts say that we would need to have at least RM1 million in retirement savings to enjoy the level of lifestyle we were accustomed to before retirement. How many of us have that much money saved up?

As it is, we are already complaining about escalating prices and soaring expenses. With inflation eating into our nest egg, we just have to keep on bringing home the bacon, especially if we have college-going children and elderly parents to support.

The impact of inflation (Source: The Star)

The younger generation of workers lament the loss of job opportunities and promotions when older workers stay on longer in their jobs. My response to them:

• Be glad that your parents are self-supporting. It means you get to spend more of your salary on yourself.
• Be glad that your parents have a job to keep them physically and mentally active. Would you rather have them bored and depressed at home?
• Not all younger workers have the wealth of experience that older workers have. How can they even think of replacing these older workers?
• Older workers can stay on to mentor younger, less experienced workers.
• The birth rate is declining while life expectancy is increasing. There will be fewer young people supporting the elderly. So the longer older workers remain employed, the lesser the pressure on the young to support them. 

Former Singapore PM Lee Kuan Yew, 86, advocates removing the retirement age. "You work as long as you can work and you will be healthier and happier for it. If you ask me to stop working all of a sudden, I think I'll just shrivel up, face the wall and just that."..."Many of our workers have a preferred retirement, and then they die early! It won't be long before the message sinks home that if you keep doing what you're doing for almost the whole of your life, the chances are you will stay interested and engaged in life, there's something to do tomorrow and you keep going. If you start saying,'oh! I'm old!' And you start reading novels and playing golf or playing chess, well, you're on the way down." (Source: Channelnewsasia)

Ultimately, it's the individual worker's choice

Well, I am for options. Employers should offer older workers the option of early retirement at 55, or continue working till 60. I recall in the 1990s (or was it 1980s?) teachers were given an option to retire at 45 (for women) and 50 (for men). 

Not all retirees want to work till they drop dead. They may want to opt out and have more time for the family, and more time to smell the roses. We should let the individual worker decide. It's his life after all.

RISING FOOD PRICES EATING INTO PENSION

Would you pay Rm10 for this plate of nasi bryani with one measly piece of fried fish? I did, at an Original Kayu restaurant in Ampang Point. When I complained, I was given an earful of the high price of fish, rice, cooking oil, etc, etc..

If your wife asks you for more money for groceries because Rm1000 a month just isn't enough to feed the family anymore, she's giving you a taste of reality. Unless you do the marketing yourself, you probably won't realize how fast and how much food prices have risen.

A loaf of wholemeal bread is now Rm3.20, bananas are Rm5.65 for a bunch of five. Add coffee or tea, butter or jam. Breakfast at home no longer comes cheap.

It wasn't that long ago when a loaf of wholemeal bread cost Rm2.10. Now it's gone up to Rm3.20. I don't eat meat. You would think I spend less on a fruit and vegie diet. I wish. My favourite Fuji apples were Rm1.19 each only a month ago. I was already complaining then. Now it's up by almost 30 sen. And you won't believe how expensive apple jambus are, especially the imported ones.

Rm14.75 for six apple jambus. That's about Rm2.50 each or 85 sen a bite.

Rm8.94 for six Fuji apples at a hypermarket. So much for eating an apple a day to keep the doctor away! Probably cheaper to fall sick and see the doctor at a public clinic.

Prices are also creeping up at hypermarkets like TESCO and Giant. Whether it's meat, beverages, cereals, sugar, garlic, vegetables or eggs, Rm100 doesn't buy as much as a year ago. Retirees are hard-hit. With no income coming in and money flowing out, they are digging into their piggy banks to pay for food.


Why is the government so reluctant to disclose the agreements signed between Tenaga Nasional and the Independent Power Producers (IPPs)? Is there something the public should not know?

Now that the electricity tariff has gone up by 7.12%, expect another round of price hikes. Don't be taken in by the government's assurances that this increase will have 'minimal impact' on consumers. Neither should we commend the 2500 members of the Malaysian Indian Restaurant Owners Association for their promise not to raise food prices. Not yet anyway.

Talk is cheap. Let's see some action.

PETROL PRICE UP - PENSIONERS THE HARDEST HIT

First it was the increase in food prices, now it's petrol price, and beginning on 1 July, new electricity tariffs. A triple whammy hitting Malaysians within a month. The post-election euphoria was certainly short-lived.

Without doubt, pensioners are the hardest hit. They don't even have the benefit of a salary increase or higher COLA to help cushion the blow to their wallets.

The Star (5 June) carried a table showing that the petrol price hike to RM2.70 a litre is still the lowest compared to what folks are paying in Thailand (RM3.90), Singapore (RM5.20), Indonesia (RM2.07) and India (RM4.00). Cold comfort indeed.

And where's the logic in comparing our petrol price with that of non-oil producing countries like Singapore and Thailand? Malaysia is an oil-producing country like these countries below. Check out their petrol prices:

UAE - RM1.19/litre

Eygpt - RM1.03/litre

Bahrain - RM0.87/litre

Qatar - RM0.68/litre

Kuwait - RM0.67/litre

Saudi Arabia - RM0.38/litre

Iran - RM0.35/litre

Brunei - RM1.10/litre

Nigeria - RM0.32/litre

Turkmenistan - RM0.25/litre

The government claims it had no choice but to increase the price following the rise in global crude oil prices due to fuel shortage. MAS managing director and CEO Datuk Seri Idris Jala has refuted the claim. He believes there is no global shortage. Prices are pushed up by speculators, hedge funds and oil futures traders. As a former oilman with SHELL, he probably knows what he's taking about. He feels the current price of US$135 a barrel is unrealistic. US$40 is more reflective of the fair value of oil.

The irony is Petronas reported a net profit of RM1,092,949,000 for the full year ended March 31, 2008. As a state-owned enterprise, Petronas' earnings help boost government coffers. For the year ended 31 March 2007, Petronas paid RM48.3 billion in taxes, royalties, dividends and export duty.

Malaysians have a right to expect some of the huge profits from oil to be channelled towards lessening the impact of rising prices in the country. The government is certainly not gaining points for the way it's handling the situation.