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HSBC survey: Malaysians not saving enough to retire

High debts and low savings are among the reasons why many Malaysians are unable to retire, a HSBC report has revealed.

A whopping 91 percent of Malaysians aged 45 and over who want to retire in the next five years are unable to do so due to some financial constraints, Country Head of Wealth Management Lim Eng Seong said, citing the report.

More than 18,000 people from 17 countries participated in the two-month survey, which represents the views of 1,105 Malaysians.

The survey participants also revealed that they are mainly bogged down by inadequate savings, having dependants who rely on their income, as well as debts such as housing loans.

They cited accumulating health bills and children’s education fees as the main reasons why many of them cannot save enough for retirement, he said at a briefing on the future of retirement in Kuala Lumpur today.

Only 69 percent of Malaysian pre-retirees aged 45 and over would like to retire within the next five years if circumstances allowed them to, Lim added.

"While financial pressures are great, only 13 percent of pre-retirees in Malaysia predict that they will never be able to retire fully.

"This is however eight percent more than what was said of the same in 2015, when only five per cent pre-retirees expected to be able to afford to fully retire," he said.

Lim said on top of the 11 percent individuals contribute to the Employees Provident Fund (EPF), they need to save an additional amount.

"It also depends on the individuals, based on their lifestyle and how much they want to save in order to be in a comfortable position to retire," he said, adding that the earlier an individual starts saving, the better.

As people fear that they will never be able to retire fully, the need for sound financial planning is stronger than ever, he said.

"Malaysians should consider these aspirations when planning for retirement and ensure they are making sufficient financial provisions for this new chapter in life.

"Even a small amount saved today can lay the groundwork for a comfortable retirement tomorrow," he added.

- Bernama

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