WHEN I was eight, my parents took my siblings and I to a bank in Petaling Jaya New Town, Selangor, for a big financial milestone – opening an account.
Our home was within walking distance to the bank where we handed over our coins and notes to a teller.
It was savings from the tuck shop allowances given to us for school.
Half-an-hour later the teller handed me a book and a Disney character saving box.
I was thrilled as I flipped the pages of the savings account book.
From a young age, my parents taught me to put aside a portion of any money I was given or earned.
Financial planning is important for retirement but when is the right time to start?
This was the question posed at a recent financial planning workshop I attended.
Most of the participants at the workshop were in their late 20s and 30s.
Among them were civil servants who were buoyed by Prime Minister Datuk Seri Anwar Ibrahim’s announcement of a record 13% pay hike from December this year.
They vowed to set aside a portion of their salary increment for their retirement and were grateful they could afford to do so.
But financial planners at the workshop told participants that saving for the future would not just “happen” but required commitment.
With rising life expectancy, people need to be prepared for a long and hopefully, physically active retirement.
One of the best strategies is to make saving automatic.
By setting aside a certain amount each month consistently, we are more likely to make saving a priority and see our nest egg grow.
Planners advised us to “Pay Yourself First” to enhance our savings.
We were told that for those employed, there was some form of retirement planning by default through the Employees Provident Fund (EPF).
EPF’s structured saving fosters disciplined financial habits, which is an important “Pay Yourself First” strategy.
But this is insufficient and there is a need to supplement with a separate retirement savings plan.
Setting aside a certain amount each month can enable most people to save for their future and achieve financial goals that fit their lifestyle.
Having a financial cushion also allows individuals to weather unexpected expenses without having to go into debt.
For Gen Z, when it comes to saving for retirement, time is their best friend.
Topping up RM100 a month in their EPF over a period of 30 years can make a big difference.
So, start saving today. You and more importantly, your future self will not regret it.
