REALISING YOUR LIFESTYLE
According to the OCBC Life Goals calculator, which uses data fed into it to calculate tuition fees and living expenses, the average cost to pursue a tertiary education abroad currently adds up to RM1,355,000 in the US and will increase to RM1,521,000 within three years. In the UK, the cost is RM732,000, rising to RM903,000 within three years, and RM593,000 in Australia, going up to RM668,000.
Having a solid financial foundation is vital to seeing your retirement goals through. Understanding how much and how well you’ve saved is only one piece of the financial puzzle. One also has to factor in inflationary pressures, which will undoubtedly raise prices for products and services in the years ahead. The travel sector for instance will see consumers spending more on holidays in the years ahead. According to the 2018 Global Travel Forecast, travel prices around the world such as airfare and hospitality are due to increase by as much as 4% percent each year.
The same applies to education. At present, the cost of a non-engineering post graduate programme can cost an average of RM35,000 at a private university. However, taking into account the yearly increase of educational costs of between 3% and 5%, the same course will cost significantly higher in the years ahead.
People would also like to stay in shape both mentally and physically during the retirement years, which means investing in wellness-upkeep programmes as well as going for regular health care checkups. According to the Malaysian Health Care Travel Council, the average medical inflation rate in the country is between 10% and 15% per year, which translates to an increase in medical costs and higher insurance premiums.
Although retirement goals might differ, it is always best to benchmark against those goals we have listed with a yearly inflation rate of 3% to 4% to ensure you are able to see them through those post retirement years. To estimate how much you need for your retirement goals, you can try OCBC’s Life Goals Retirement Calculator for free within their website. This simple calculator helps to assess your current financial status versus your retirement goals in four simple steps.
As such it is prudent to set out to create a sound financial plan for a life of your own design for the future. Planning ahead will afford you the foresight of bolstering your long-term financial planning with additional finances and diversified investments. By gaining this head start, expanding on your plans becomes a distinct possibility.
In a time past, retirement was viewed as something you saved and prepared for, but now it has become an avenue to reinvigorate one’s life, purpose and ambition. A golden opportunity, if you will, to turn retirement into productive years to do more things and discover more meaning. Knowing what you want out of life and preparing for it will help secure the lifestyle and future you want and deserve during your retirement years.