1. Every now and then, our clients and friends will enquire about savings programmes that assist in reducing taxes and building a retirement nest egg. 2. We dutifully show them the various options available and give them a projected value on maturity. 3. Most plans tend show 2 sets of Illustration, one being the most favourable and the other, the most conservative. In all reality, both will not occur as it is improbable to have a consistent set of returns every year. There will be up’s and equally, downs. 4. A mid-point would thus be the most practical value to gauge expectations. Although simplistic in approach, it is still better than relying on either extreme. 5. At this point, one in two times, we get remarks like “The plan gives back Rm100k in 20 years time? What is the value of Rm100k then? What can it do with inflation being so high?” 6. Usually, this remark comes from those who are highly educated and holding decent paying jobs. The so-called below excellent ones usually just get things started and move on to other matters. 7. In our years of practice, the ones who got things done are living reasonably comfortable lives and are midway through their retirement plans. When they retire, they will cash out their EPF/CPF as well as live off the Private Pension Plans that we have helped structure. 8. They may not be wealthy, but they will have money to live, eat, go for vacation and enjoy the simpler things in life with dignity. They will not have to beg and depend on anyone else but themselves. 9. The intelligent ones however, keep talking about how inflation eats away values and are constantly seeking for plans that will beat inflation. Even after 10 years, they are still talking and talking but just never getting down to doing. 10. They are just too smart for their own good. They are procrastinators who just keep delaying and delaying. When they do get down to doing it, they will analyse it so much that in the end, they are back to square one. 11. Back to Point 5 above. we agree that Rm100k can get a bungalow 20 years ago but can only be the down payment for a cluster house today. Purchasing power has deteriorated over the years due to inflation. 12. But the fact remains, Rm100k is still a big sum of money back then and still is now. Just how many ordinary people can casually raise Rm100k as and when needed? The sooner we take the first step towards implementing a savings plan that disciplines us, the safer we are in our greying years to come. 13. The decision made by the Young You today determines’ how the Old You will be in years to come. If you have yet to start any, get it done. If you have done one, get a second one started. If you have done an Endowment, get an Annuity started. There must be progress. 14. Here’s wishing you all the best in getting things moving. Just don’t let too much analysis lead to paralysis.
Posted on: Mon, 16 Sep 2013 09:46:39 +0000
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