Aging In Malaysia

Malaysia’s racing against time to become a developed nation but with a growing population of singles, couples having fewer kids and people living longer, there’s a high chance we’ll be an aged country before then. And, we are far from ready to grow old. Malaysia is fast becoming an aged nation. And it isn’t ready. In 2006, we hit the ageing status and by 2030, we’ll be aged. Lack of care centres for the aged, infrastructure and money are why we’re struggling.

“Making policies and implementing them takes time. And, you can’t save money overnight,” he warns, stressing that not enough retirement savings and low financial literacy are big challenges.
Sixty-eight percent of members aged 54 have savings lower than RM50,000 which can only last five years assuming they spend RM820 per month. The full EPF withdrawal age is 55 but the average life expectancy is 75.

Malaysians must face facts. We’re living longer so we must work longer, he says.

“The new poverty line income is RM930. So, how long do you think RM50,000 will last now with rising healthcare costs?” he asks, adding that the price of surgery spiked by about 14% from 2006 to 2013.

He cautioned against withdrawing the EPF early for expenses that don’t build assets. In the old days, investing in your child’s education brings returns. Nowadays, it’s not a sure thing that they will take care of you, he says, matter of fact.

“Withdrawing money for investment is also risky because one in 10 new businesses fail.” He believes that financial literacy is the key to facing the challenges of an aged nation. That’s why the EPF launched our Retirement Advisory Service last year.

“We also need a holistic social security master plan. The critical illness insurance penetration is too low here. There must be better coverage for those in the informal sectors.
“We need to get moving now.”

He says the lack of retirement products for those in the active ageing (55-70), passive ageing (65-80) and frail (over 80) categories are a major challenge. The lack of specialised services, care givers and geriatric doctors are challenges needing attention. Also urgent are a legal framework, standard operating procedures and enforcement to manage abuse cases and prevent centres from becoming a dumping ground for abandoned seniors, and aged-friendly infrastructure.