4 LESSONS FROM THE MARKET

4 LESSONS FROM THE MARKET

Lesson 1

Markets move in cycles. They go down, but history has shown us that they always recover. (Similarly, markets that rise excessively will eventually come crashing down, so beware of buying into investment bubbles). The best approach is to accept market volatility, stick to your strategy and don’t panic. By withdrawing from the market you could be robbing yourself of the most valuable gains.

Lesson 2

Diversification reduces risk. Because it’s impossible to predict market movements, one way to manage market risk is to maintain a diversified portfolio. Spreading your investments across a range of carefully diversified assets, will minimize the risk and smooth your returns. As Certified Financial Planner (CFP), I can help you know and learn about funds that will help to diversify your portfolio.

Lesson 3

“Time-in” not “timing”. Be patient, especially if you are investing or the long term. When things look bleak it’s important to keep your goals in focus. Getting out of the market could mean you miss the rebound and the returns that go with them.

Lesson 4

Start early, save regularly. The sooner you start investing and the more often you do it, the better. Starting up a regular savings plan takes the guess work out of trying to find the right time to make an investment. Starting now will give your money time to grow through the power of compounding.

MENDIDIK ANAK MENGENAI WANG

Bilakah masa yang sesuai untuk mendidik anak-anak mengenai nilai wang? Tidak ada jangka waktu tertentu tetapi eloklah dimulakan seawal yang boleh. Mendidik, menggalakkan dan memberi kepercayaan kepada anak untuk bijak berbelanja sejak kecil akan menanamkan tabiat kewangan yang baik. Untuk memulakan anak anda mengenal tanggungjawab kewangan, ada enam panduan mudah di sini:

Berikan mereka wang saku

Memberikan wang saku boleh membantu membina keupayaan anak merancang perbelanjaan. Bagi memutuskan berapa banyak yang perlu diberikan kepada mereka, fikirkan dengan teliti jenis perbelanjaan yang boleh digunakan untuk wang saku itu. Misalannya, bagi belanja sekolah, elok kalau anda pergi tinjau harga makanan dan minuman yang dijual di kantin sekolah sebelum memutuskan berapa banyak wang saku yang diperlukan oleh anak anda. Jika perlu, berikan wang saku dalam beberapa pecahan wang bagi menggalakkan mereka menabung. Misalannya, jika wang saku RM2, berikan anak anda wang kertas RM1 manakala selebihnya dalam bentuk wang syiling supaya dia boleh mengasingkan beberapa keping wang syiling untuk dimasukkan ke dalam tabung.

Tentukan matlamat yang realistik

Berbincanglah dengan anak anda mengenai matlamat mereka kerana itulah kunci kejayaan dalam menabung. Matlamat tabungan anak anda mungkin merupakan sejenis barang permainan yang istimewa, buku, basikal atau permainan Play Station yang terkini. Walau apa pun, matlamat itu mestilah realistik dan boleh menggalakkan mereka untuk menabung. Walau bagaimanapun, berbincang dengan mereka dahulu. Matlamat itu mestilah matlamat mereka, bukannya matlamat anda. Kemudian, tinjau kos barang yang hendak dibeli itu dan congak berapa banyak anak anda perlu menabung setiap minggu bagi membeli barangan tersebut dalam satu jangka masa. Pastikan ia munasabah…

Bagi anak yang masih kecil, alat pandang dengar boleh membantu. Gunting gambar yang diperlukan dan lekatkan pada sebuah balang. Sambil dia memasukkan wang ke dalam balang itu setiap hari, dia boleh tengok wangnya semakin bertambah dan tidak lama lagi bolehlah dia mencapai matlamatnya. Anak yang lebih besar boleh menyimpan rekod simpanan dalam buku nota dan buat pengiraan setiap minggu.

Didik mereka mengenai nilai pelaburan

Memulakan tabiat menabung dan melabur sejak awal merupakan kunci kepada perancangan kewangan yang berjaya. Jika boleh, setiap kali anda ke bank untuk berurusan atau untuk melabur dalam unit amanah, bawa sekali anak-anak dan bukalah akaun simpanan untuk mereka. Laburkan sebahagian daripada wang simpanan mereka dalam dana amanah dan ajak mereka sama-sama melihat perkembangan pelaburan itu.

Walau bagaimanapun, jangan halang hak anak anda untuk mengeluarkan sedikit wang simpanan atau pelaburan mereka untuk membeli sesuatu kerana, jika anda menghalang mereka, mungkin akan melemahkan minat mereka untuk menabung atau melabur. Yang perlu dilakukan ialah memberitahu mereka bahawa jika wang simpanan dikeluarkan sebelum matlamat mereka tercapai, maknanya lebih lamalah masa yang akan diambil untuk mencapai matlamat mereka. Jika mereka mengeluarkan simpanan setelah mencapai matlamat mereka, itu juga merupakan pilihan mereka sendiri. Pendek kata, tak kiralah sama ada mereka mahu mengeluarkan wang simpanan sebelum mencapai matlamat mereka (sekiranya berlaku kes kecemasan atau ada barang yang mereka perlukan segera) ataupun tidak, terpulanglah kepada mereka keputusan sepenuhnya dan untuk mereka memahami kesan mengeluarkan wang itu pada masa tersebut.

Simpan rekod kewangan yang baik

Galakkan anak-anak anda menyimpan resit pembelian buku, permainan atau barangan lain dalam sampul surat atau menyimpan jurnal perakaunan yang mudah bagi membolehkan mereka menjejaki perbelanjaan dan tabungan mereka. Ini boleh menanamkan tabiat merekodkan perbelanjaan supaya mereka boleh belajar mengurus kewangan mereka secara sistematik pada masa hadapan.

Contohnya:

Matlamat : Ingin membeli Buku Cerita

Harga : RM25.90

Minggu 1	Elaun Harian Contohnya	Wang yang dibelanjakan Contohnya	Jumlah Contohnya (RM)	Wang yang disimpan Contohnya
Isnin	RM3.00	Makanan Alat tulis	RM2.30	RM0.70
Selasa
Rabu
Khamis
Jumaat
Sabtu
Ahad
Jumlah

Izinkan anak-anak mengatur sendiri perbelanjaan mereka

Belajar berbelanja secara bijak membabitkan beberapa percubaan dan kesilapan. Sama ada keputusan berbelanja yang mereka ambil itu baik atau tidak, mereka perlu belajar daripada pilihan mereka sendiri. Sebagai ibu bapa, anda boleh mengajak mereka berbincang secara terbuka mengenai kebaikan dan keburukan sebelum mereka berbelanja. Galakkan anda membuat sedikit tinjauan sebelum berbelanja besar atau menunggu masa yang sesuai untuk membeli, misalannya ketika jualan murah.

Tunjukkan contoh yang baik

Akhir sekali, sebagai ibu bapa, tunjukkan contoh yang baik melalui pengurusan kewangan anda sendiri yang baik dan bijak. Elakkan pembelian yang tidak dirancang atau mengejut. Elakkan daripada banyak membuat hutang tidak perlu, contohnya hutang kad kredit. Sama ada baik atau buruk, anak-anak belajar bagaimana menguruskan wang daripada ibu bapa mereka. Seperti kata pepatah, “Ke mana tumpahnya kuah kalau tidak ke nasi”. Oleh itu, mendidik anak anda tentang pengurusan wang yang baik serta menunjukkan pula contoh yang baik, pasti akan mendorong mereka berjaya mengendalikan kewangan mereka sendiri. Mulakanlah sekarang!

SAVING FOR RETIREMENT

Retirement can be a rewarding phase in a person’s life, which is why so many people want to retire early. Some plan to work until they are 45 years old, and thereafter to spend the rest of their lives on the beach, or traveling round the world. Of course, the ability to retire early would depend on how much money you can successfully set aside (during your working years) – and this would normally depend on how well you have planned for your retirement.

It is important to engage in basic retirement planning throughout your working life and update those plans periodically, especially when your situation change – financially or otherwise. While it is never too late to plan for retirement, starting early helps to avoid any unnecessary stress. In order to save for the future, there is of course that trade-off between spending and saving. For example, if you spend lavishly now, buying expensive sports cars, high-end hi-fi systems or overseas holidays, then you may not have much left in your bank account when you retire. Unless of course, you have managed to set aside some money through investing wisely, or have other forms of compulsory savings to provide you with a comfortable lifestyle when you retire.

Seven easy steps to work out how much money you need

STEP 1

Determining the number of years you have until retirement

The first thing you need to do is to determine how many years you have to achieve your retirement plan. In order words, how many more years until your retirement – this can be when you plan to retire (for instance, at age 45), or must retire (for example, age 55 or 56 in the civil service), less your current age.

Let’s take an example of Nazri, who is now 31 years old and plans to retire at age 55. The number of years to his retirement would be:

Planned age to retire	:	55 years
Less present age	:	31 years
Equals number of years to retirement	:	24 years

STEP 2

Determining your desired retirement income

The next step is to ascertain how much money you will need when you retire, and are no longer working. This is difficult to predict but it is not impossible. You can estimate this by considering changes you plan to make to your spending patterns and how (and where) you plan to live after you retire. Some of your expenses will probably be lower, for example, work-related expenses (like fuel or bus fare), clothing expenses and housing expenses. On the other hand, some other expenses may increase: for example, your travel expenses, since you may have more free time. At the same time, your medical expenses may also increase, as you get older and become more susceptible to illnesses. It is often suggested that you will need about 60% to 70% of your last drawn annual income after you retire.

In our example, let’s assume that Nazri’s last drawn income is RM200,000 per year. As such, his desired annual income upon retirement would be RM120,000 (that is, 60% of RM200,000), calculated as:
0.6 X RM200, 000 = RM120,000

Once we have done this, we need to estimate how long he would need this retirement income. The number of years this income is required is a function of how long he is expected to live. In Malaysia, according to the latest information from the Statistics Department, the average life expectancy is 70 years for males, and 75 for females.

Let’s assume that Nazri expects to live till 80 years old, and as such, he would need 25 years of retirement income (from age 55 onwards).

STEP 3

Calculating your inflation-adjusted retirement income

Inflation is one of the most important factors to consider in retirement planning. It erodes the purchasing power of your retirement savings, and thus needs to be taken into account in your planning. Here you need to determine how much your retirement income would be, adjusted for inflation.

In our example, we know that the current value of Nazri’ retirement income is RM120, 000 (from Stap 2) and he has 24 years before he retires (from Step 1). The average inflation rate in Malaysia (from 1990 to 2001) is 3.3% - see chart below. Let us assume that the average inflation rate over the next 24 years will be 5% per annum.

Source: Department of Statistics

A retirement income of RM120, 000 today at an average inflation rate of 5% would require James to have an inflation-adjusted income of RM387, 011 per annum in 24 years time. This can be calculated as:

FV = RM120, 000 x FVIF (24 yrs, 5%) = RM120, 000 x 3.225 = RM387,000

FV = Future value FVIF = Future value interest factor

STEP 4

Calculating the total funds needed at retirement

After you have ascertained the inflation-adjusted income needed for retirement in the future, you next determine the total funds needed.

Let’s assume that the average rate of return (on our investments) for the next 25 years until retirement would be 8%. As such, the ‘real’ rate of return from your savings (given that inflation is 5%) would therefore be 3% (that is, 8% minus 5%).

In our example, given that Nazri’s inflation-adjusted income at retirement equals RM387,011 per annum (determined in Step3), the total funds he would need can be calculated as:

PVA = RM387,000 x PVIFA (25 yrs, 3%) = R387,000 x 17.413 = RM6,738,831

PVA = Present value of annuity; PVIFA = Present value interest factor of annuity.

Hence, the total fund needed when he retires, 24 years from today would be approximately RM6,738,831.

STEP 5

Estimating funds available at retirement

The following step is to estimate the funds that will be available when you retire. Again, this amount is difficult to determine accurately and would depend on various factors such as the type of assets you have today, and those that you will accumulate in the future. Some of the sources of funds would include your EPF savings, personal ‘compulsory’ savings, insurance cash values, and financial assets such as stocks and unit trusts, which can be disposed of. To simplify our analysis, let’s assume that in Nazri’s case, his available funds amount to RM3,000,000 (accumulated from various sources) when he retires.

STEP 6

Calculating the shortage (or surplus) of funds at retirement

Once we have determined the total funds you require, and also the funds available at retirement, you can then plan for any possible shortfall.

Total funds we require (from Step 4):	RM6,738,831
Total funds available (from Step5):	RM3,000,000
Total shortfall:	(RM3,738,831)

STEP 7

Calculating the savings required to cover shortfall

Next, to meet the shortfall at retirement that was identified in the previous step, you need to calculate how much you must save during your working life.

For Nazri, we know that:

His total shortfall:	(RM3,738,831)
No. of years to retirement :	24 years
Average rate of return:	8%

Therefore, the amount that he would need to save in order to meet the shortfall (which is equivalent to an annuity), can be calculated as:

PMT = (RM3,738,831) / FVIFA (24 yrs, 8%) = (RM3,738,831)/ 66.764 = RM56,000

PMT = Periodic payment (annuity); FVIFA = Future value interest factor of annuity.

Hence, in our example, Nazri would need to save a total of RM56,000 per annum (or roughly RM4,666.7 per month), in order to meet his shortfall target.

We have demonstrated above how you can easily determine how much money you really need to retire, taking into account important factors such as inflation and the rate of return on your investments. The step-by-step process is intuitive, and allows you to estimate how much you need to save in order to build up your retirement fund. This will allow you to plan accordingly to achieve your retirement goals.

Summary of Retirement Planning Process

Step 1: Determine when you plan to retire

Step 2: Determine your desired retirement income

Step 3: Calculate inflation-adjusted retirement income

Step 4: Calculate funds needed at retirement

Step 5: Project funds available at retirement

Step 6: Calculate surplus/(shortage) of fund at retirement

Step 7: Calculate savings required to cover shortfall

Melayu masih lemah sistem kewangan

APABILA timbul skim cepat kaya dan pelaburan menerusi Internet, orang Melayu yang paling ramai berhimpun mendengar cerita dan sanggup menghabiskan wang untuk menyertainya.

Sedangkan orang Melayu tidak pernah mempersoalkan di mana wang itu dilaburkan dan siapa yang menguruskan dana tersebut. Betapa singkatnya minda bangsa kita untuk mendapatkan wang dengan cara mudah hanya dengan menaja beberapa orang kononnya akan mendapat pulangan yang lumayan.

Tetapi apabila terdapat sistem kewangan yang dipantau oleh kerajaan, kebanyakan kita mempersoalkan halal dan haram dan perkara remeh yang sengaja diperbesarkan untuk menyempitkan minda bangsa sendiri.

Dalam membicarakan soal-soal kewangan, orang Melayu agak jauh ketinggalan dalam sistem kewangan seperti bidang insurans, unit amanah dan lain-lain produk kewangan yang mendapat kelulusan kerajaan dan di bawah pemantauan Bank Negara.

Kelemahan ini wujud hampir di semua lapisan masyarakat Melayu dari yang berpendidikan tinggi hingga kepada mereka yang berpendidikan rendah. Amat mendukacitakan untuk mengakui bahawa hampir 80 peratus golongan profesional Melayu masih kurang memahami mengenai sistem perancangan kewangan yang boleh membantu menjana ekonomi keluarga mereka.

Sikap tertutup bangsa Melayu seperti ‘katak bawah tempurung’ masih tebal dalam soal membicarakan pengurusan kewangan khususnya melalui penasihat kewangan yang bertauliah. Malah keadaan ini juga mungkin disebabkan sikap negatif diri mereka sendiri (paling ramai) dan kemungkinan sikap ajen dan penasihat kewangan yang tidak profesional dan beretika.

Dalam membina kekuatan ekonomi, tugas perunding kewangan insurans dan wakil takaful adalah sangat penting demi memberikan pemahaman yang baik untuk bangsa kita mengubah paradigma dalam pengurusan kewangan.

Namun kekesalan utama bidang kewangan ini ialah apabila ada wakil takaful menjalankan tugas tanpa etika profesional semasa berurusan dengan pelanggan. Apa yang berlaku di depan mata menyebabkan penulis terfikir mengenai sistem dan amalan perniagaan takaful yang kononnya ‘Islamik’ adalah benar-benar tidak beretika.

Daripada 10 penasihat takaful yang ada, saya berani mengatakan hanya seorang dua daripada mereka menjual produk syarikat dengan profesional, dan selebihnya memburukkan syarikat insurans konvensional dengan pelbagai tohmahan kononnya haram dan tidak Islam. Malah di kalangan penasihat takaful juga mereka memburukkan syarikat takaful yang lain demi menambat hati pelanggan.

Untuk pengetahuan, ramai penasihat takaful berhijrah dari sebuah syarikat ke syarikat takaful yang lain demi mengejar komisen dan ganjaran. Apa yang berlaku ini adalah realiti yang menjejaskan reputasi takaful yang dilihat sebagai sistem kewangan Islam. Malah pemegang polisi menjadi mangsa apabila wujud pelbagai masalah yang berlaku disebabkan sikap penasihat takaful yang mementingkan diri sendiri.

Bank Negara melalui badan khas yang mempunyai kuasa perlu menyiasat bagaimana begitu ramai pelanggan insurans konvensional yang menamatkan polisi mereka melalui usaha wakil takaful yang bermoral rendah ini. Terdapat banyak bukti pelanggan dihasut dan diminta menulis surat memberhentikan polisi yang telah dibayar bertahun-tahun kerana dikatakan ‘haram’ menggunakan wang tersebut.

Sepatutnya menjadi dasar Bank Negara untuk bertindak tegas jika amalan ini dikesan. Maklumat atau info insurans yang dikeluarkan oleh BNM melalui kerjasama syarikat insurans dan takaful di dada-dada akhbar yang tertulis “Membeli polisi insurans hayat, jangan jadi mangsa kepada penukaran polisi” jelas tidak diendahkan oleh kebanyakan wakil takaful. Adakah info tersebut hanya sekadar melepaskan batuk di tangga dan tiada usaha konkrit menanganinya? Kita bimbang jika industri kewangan ini terjejas pastinya merugikan ramai pemegang polisi dan kaum keluarga mereka jika terjadi sesuatu.

Keutuhan sistem kewangan juga secara tidak langsung akan terjejas akibat sikap penasihat takaful yang sebegini.

Apa yang tidak diketahui oleh pemegang polisi insurans konvensional ialah kebanyakan sistem konvensional telah lama mematuhi pelaburan berasaskan syarak. Malah hal-hal yang meragukan seperti riba tidak lagi menjadi amalan syarikat insurans konvensional kini. Paling terbukti ialah sistem takaful sehingga hari ini masih tidak dapat menanding operasi insurans konvensional yang jauh cekap dan efisien.

Malah rungutan mengenai masalah tuntutan adalah amat minimum berbanding surat pembaca yang terpampang di akhbar dan banyak lagi masalah yang sebenarnya tidak diadukan secara terbuka. Inilah natijah yang ditanggung oleh operasi takaful kerana sikap tidak beretika wakil mereka dalam urusan menambat hati pelanggan.

Pengalaman seorang rakan yang pernah menjadi ajen insurans konvensional dan dipujuk menyertai sebuah syarikat takaful menjadi asas dan bukti kukuh apa yang sedang berlaku dalam industri takaful. Setelah mendaftar dan lulus sebagai ajen beliau telah menghadiri sesi penerangan dan mesyuarat oleh agensi takaful berkenaan selama beberapa minggu.

Akhirnya beliau mengambil keputusan menjalankan semula perniagaan insurans konvensional apabila mendapati ‘modal besar’ syarikat tersebut memasarkan produk mereka ialah dengan memburukkan insurans konvensional. Persoalannya adakah mereka ini benar-benar memahami sistem insurans konvensional.

Paling menyedihkan kebanyakan orang Melayu difahamkan bahawa maksud ‘konvensional’ adalah ‘haram’. Sedangkan merujuk Kamus Dewan, ‘Konvensional’ bermaksud sesuatu amalan, ciri-ciri atau lain-lain yang sudah diiktiraf secara meluas dan dipatuhi.

Seperti yang dinyatakan dalam satu dalil “ Janganlah engkau menghukum tanpa ilmu, kelak engkau akan menganiaya orang lain.”

Sudah sampai masanya Bank Negara mengambil tindakan proaktif terhadap amalan niaga wakil takaful seperti ini agar mereka tidak menjadikan amalan ini sebagai budaya kerja syarikat takaful yang semakin ketara. Sikap mereka yang seronok memburukkan pihak lain tidak pernah diajar dan dibenarkan dalam Islam. Apakah rezeki yang mereka peroleh dengan usaha ‘memijak’ orang lain mempunyai keberkatan ?

Adalah amalan niaga yang berunsur kotor seumpama ini dapat meningkatkan kefahaman orang Melayu terhadap sistem dan pengurusan kewangan yang berkesan. Lihatlah teras dan amalan niaga bangsa lain yang mengutamakan kepuasan pelanggan dan menyediakan perkhidmatan yang memuaskan.

Jarang sekali kita mendengar sikap ‘menghentam’ orang lain dalam budaya niaga mereka. (Rujuk buku Rahsia Bisnes Orang Cina – Ang Wang Seng).

Orang Melayu sebagai bangsa yang beragama Islam wajar mengubah budaya ini dalam segenap kontek khususnya dalam bidang ekonomi, perniagaan, politik, kemasyarakatan dan sebagainya. Amalan bermoral dan membina kekuatan peribadi dalam kontek modal insan yang dibina dalam diri sendiri dan seterusnya masyarakat Melayu perlu terus diterapkan dan diingatkan sesama kita.

Panel syariah bezakan saham amanah

PELUANG pelaburan dalam unit amanah Islam timbul bukan semata-mata untuk mewujudkan pilihan kepada unit amanah konvensional, tetapi ia sememangnya diperlukan bagi memenuhi kepentingan pelabur-pelabur Islam. Pengenalannya turut menarik minat sebahagian besar pelabur bukan Islam kerana pulangan yang dihasilkan adalah sebanding dan kadang-kala lebih dari unit-unit konvensional.

Prosidur dan cara operasi dana-dana amanah Islam adalah lebih-kurang sama dengan cara konvensional. Yang membezakannya ialah kewujudan panel syariah bagi memantau dan memastikan unit amanah Islam yang ditawarkan adalah diurus dan ditadbir berlandaskan hukum syariah. Individu berkelayakan yang terpilih menduduki panel Syariah dalam setiap syarikat pengurus akan bekerjasama dengan Majlis Penasihat Syariah (SAC) dan Suruhanjaya Sekuriti (SC) dalam mempastikan dana-dana Islam mempraktikkan keperluan syariah dalam setiap sudut operasi dan pelaburan yang dijalankan. Dana-dana Islam ini hanya akan melabur dalam portfolio ‘halal’ dan sekuriti-sekuriti yang diterbitkan berlandas prinsip Islam.

Dana Islam yang melabur dalam portfolio saham halal contohnya, tidak akan melabur dalam kaunter-kaunter saham di mana syarikat tersebut terlibat dengan aktiviti, produk atau perkhidmatan seperti perbankan, insurans dan perkhidmatan kewangan konvensional, perjudian, memproses/memasarkan minuman keras dan makanan-makanan yang tidak halal (seperti yang mengandungi daging babi).

Khidmat panel syariah penting dalam industri untuk menjaga kepentingan pelabur. Secara ringkasnya, panel syariah adalah bertanggungjawab dan berkewajipan ke atas perkara-perkara seperti berikut:-

* Bertanggungjawab memberi nasihat kepada para pengurus berkenaan urusan pentadbiran dana Islam, perihal struktur dan operasi, serta dalam proses pelaburan yang dijalankan.

* Memastikan perjalanan dana-dana Islam mematuhi segala ketetapan dan peraturan yang diputuskan oleh SC berkenaan hal-hal unit amanah dan syariah.

* Merujuk kepada SC, yang kemudiannya merujuk kepada Majlis Penasihat Syariah, untuk mendapatkan khidmat nasihat sekiranya terdapat ketidakpastian dalam aspek khas urusan unit amanah Islam.

* Meneliti laporan pematuhan (compliance report) yang disediakan oleh pejabat pengurus, laporan transaksi selepas atau sebelum disahkan oleh pemegang amanah dan lain-lain laporan yang berkaitan, dengan tujuan setiap prinsip syariah telah dipatuhi.

* Menyediakan satu laporan pengesahan sama ada satu-satu dana itu telah diurus mengikut syariah, untuk disertakan sebagai satu laporan interim atau tahunan.

* Menyemak dan memberi nasihat terhadap bahan-bahan yang akan digunakan dalam mempromosikan dana syariah.

* Menghadirkan diri dalam mesyuarat-mesyuarat yang diadakan dari masa ke semasa oleh SC atau mana-mana pihak berkuasa, berkenaan perkara-perkara yang berkaitan dana amanah dan syariah.

* Menjawab keraguan pelabur berkenaan hal-hal syariah, yang bersangkutan dengan unit amanah yang ditawarkan.

Kewujudan panel syariah mempastikan dana-dana Islam yang dilancarkan bukan terbit atas nama sahaja. Peranan dimainkan meningkatkan keyakinan pelabur bahawa operasi dan cara pelaburan dana amanah Islam yang ditawarkan tidak akan menyimpang hukum syariah Islam.

SAVING FOR RETIREMENT

Retirement can be a rewarding phase in a person’s life, which is why so many people want to retire early. Some plan to work until they are 45 years old, and thereafter to spend the rest of their lives on the beach, or traveling round the world. Of course, the ability to retire early would depend on how much money you can successfully set aside (during your working years) – and this would normally depend on how well you have planned for your retirement.

It is important to engage in basic retirement planning throughout your working life and update those plans periodically, especially when your situation change – financially or otherwise. While it is never too late to plan for retirement, starting early helps to avoid any unnecessary stress. In order to save for the future, there is of course that trade-off between spending and saving. For example, if you spend lavishly now, buying expensive sports cars, high-end hi-fi systems or overseas holidays, then you may not have much left in your bank account when you retire. Unless of course, you have managed to set aside some money through investing wisely, or have other forms of compulsory savings to provide you with a comfortable lifestyle when you retire.

Seven easy steps to work out how much money you need

STEP 1

Determining the number of years you have until retirement

The first thing you need to do is to determine how many years you have to achieve your retirement plan. In order words, how many more years until your retirement – this can be when you plan to retire (for instance, at age 45), or must retire (for example, age 55 or 56 in the civil service), less your current age.

Let’s take an example of Nazri, who is now 31 years old and plans to retire at age 55. The number of years to his retirement would be:

Planned age to retire	:	55 years
Less present age	:	31 years
Equals number of years to retirement	:	24 years

STEP 2

Determining your desired retirement income

The next step is to ascertain how much money you will need when you retire, and are no longer working. This is difficult to predict but it is not impossible. You can estimate this by considering changes you plan to make to your spending patterns and how (and where) you plan to live after you retire. Some of your expenses will probably be lower, for example, work-related expenses (like fuel or bus fare), clothing expenses and housing expenses. On the other hand, some other expenses may increase: for example, your travel expenses, since you may have more free time. At the same time, your medical expenses may also increase, as you get older and become more susceptible to illnesses. It is often suggested that you will need about 60% to 70% of your last drawn annual income after you retire.

In our example, let’s assume that Nazri’s last drawn income is RM200,000 per year. As such, his desired annual income upon retirement would be RM120,000 (that is, 60% of RM200,000), calculated as:
0.6 X RM200, 000 = RM120,000

Once we have done this, we need to estimate how long he would need this retirement income. The number of years this income is required is a function of how long he is expected to live. In Malaysia, according to the latest information from the Statistics Department, the average life expectancy is 70 years for males, and 75 for females.

Let’s assume that Nazri expects to live till 80 years old, and as such, he would need 25 years of retirement income (from age 55 onwards).

STEP 3

Calculating your inflation-adjusted retirement income

Inflation is one of the most important factors to consider in retirement planning. It erodes the purchasing power of your retirement savings, and thus needs to be taken into account in your planning. Here you need to determine how much your retirement income would be, adjusted for inflation.

In our example, we know that the current value of Nazri’ retirement income is RM120, 000 (from Stap 2) and he has 24 years before he retires (from Step 1). The average inflation rate in Malaysia (from 1990 to 2001) is 3.3% - see chart below. Let us assume that the average inflation rate over the next 24 years will be 5% per annum.

Source: Department of Statistics

A retirement income of RM120, 000 today at an average inflation rate of 5% would require James to have an inflation-adjusted income of RM387, 011 per annum in 24 years time. This can be calculated as:

FV = RM120, 000 x FVIF (24 yrs, 5%) = RM120, 000 x 3.225 = RM387,000

FV = Future value FVIF = Future value interest factor

STEP 4

Calculating the total funds needed at retirement

After you have ascertained the inflation-adjusted income needed for retirement in the future, you next determine the total funds needed.

Let’s assume that the average rate of return (on our investments) for the next 25 years until retirement would be 8%. As such, the ‘real’ rate of return from your savings (given that inflation is 5%) would therefore be 3% (that is, 8% minus 5%).

In our example, given that Nazri’s inflation-adjusted income at retirement equals RM387,011 per annum (determined in Step3), the total funds he would need can be calculated as:

PVA = RM387,000 x PVIFA (25 yrs, 3%) = R387,000 x 17.413 = RM6,738,831

PVA = Present value of annuity; PVIFA = Present value interest factor of annuity.

Hence, the total fund needed when he retires, 24 years from today would be approximately RM6,738,831.

STEP 5

Estimating funds available at retirement

The following step is to estimate the funds that will be available when you retire. Again, this amount is difficult to determine accurately and would depend on various factors such as the type of assets you have today, and those that you will accumulate in the future. Some of the sources of funds would include your EPF savings, personal ‘compulsory’ savings, insurance cash values, and financial assets such as stocks and unit trusts, which can be disposed of. To simplify our analysis, let’s assume that in Nazri’s case, his available funds amount to RM3,000,000 (accumulated from various sources) when he retires.

STEP 6

Calculating the shortage (or surplus) of funds at retirement

Once we have determined the total funds you require, and also the funds available at retirement, you can then plan for any possible shortfall.

Total funds we require (from Step 4):	RM6,738,831
Total funds available (from Step5):	RM3,000,000
Total shortfall:	(RM3,738,831)

STEP 7

Calculating the savings required to cover shortfall

Next, to meet the shortfall at retirement that was identified in the previous step, you need to calculate how much you must save during your working life.

For Nazri, we know that:

His total shortfall:	(RM3,738,831)
No. of years to retirement :	24 years
Average rate of return:	8%

Therefore, the amount that he would need to save in order to meet the shortfall (which is equivalent to an annuity), can be calculated as:

PMT = (RM3,738,831) / FVIFA (24 yrs, 8%) = (RM3,738,831)/ 66.764 = RM56,000

PMT = Periodic payment (annuity); FVIFA = Future value interest factor of annuity.

Hence, in our example, Nazri would need to save a total of RM56,000 per annum (or roughly RM4,666.7 per month), in order to meet his shortfall target.

We have demonstrated above how you can easily determine how much money you really need to retire, taking into account important factors such as inflation and the rate of return on your investments. The step-by-step process is intuitive, and allows you to estimate how much you need to save in order to build up your retirement fund. This will allow you to plan accordingly to achieve your retirement goals.

Summary of Retirement Planning Process

Step 1: Determine when you plan to retire

Step 2: Determine your desired retirement income

Step 3: Calculate inflation-adjusted retirement income

Step 4: Calculate funds needed at retirement

Step 5: Project funds available at retirement

Step 6: Calculate surplus/(shortage) of fund at retirement

Step 7: Calculate savings required to cover shortfall