M’sians face sustaining retirement life challenge

KUALA LUMPUR: With higher life expectancy, Malaysians will find difficulty in sustaining their retirement life, said Prof Dr Jomo Kwame Sundaram, who is the third holder of the Tun Hussein Onn Chair at the International Studies at Institute of Strategic and International Studies (ISIS) Malaysia.
“This is a very serious challenge if life expectancy continues to rise. So we need to apply ourselves to this challenge and have a variety of possible options to work on,” he said in his keynote address at the Khazanah Megatrends Forum 2016 here yesterday.
According to data from Khazanah Research Institute: State of Malaysian Households 2 Report, the average Employees Provident Fund savings of a 51- to 55-year-old of RM159,952 would, at the current rates of interest and inflation, only last 15.6 years if he or she draws a poverty line income every month.
“You will find the EPF savings would not be able to sustain for more than 16 years at poverty level,” he said.
Meanwhile, Jomo said the ageing population is also a serious problem to the country and that the government has to re-look current policy.
“But right now, we’re kind of stuck in the system which has not changed, partly because we don’t get to address the fundamental population issue,” he noted.
He declined to comment on calls by certain quarters to extend the retirement age to 62 from 60 years old.
“I don’t want to get into very specific discussion. I think the important thing is to recognise that a lot of workers in this country are not even recognised in the country,” he said, noting that the government needs to seriously look at the illegal foreign worker issue.