A retirement target is personal. Someone expecting to spend RM3,000 a month will need a different amount from someone planning for RM8,000. The number also changes with retirement age, life expectancy, inflation and the returns earned before and during retirement.
Start with retirement spending
Think about the monthly lifestyle you want in today's Ringgit. Housing, food, transport, healthcare, travel and family commitments can all continue into retirement, although the mix may be different from today.
Inflation means today's RM won't buy the same amount later
If retirement is decades away, the future cost of your desired lifestyle can be materially higher than today's cost. A useful planner therefore grows your spending assumption toward retirement instead of simply multiplying today's monthly spending by a number of years.
Your existing EPF is only the starting balance
Current EPF savings can continue to grow, and future employee and employer contributions can add substantially to the balance over a long career. Salary growth and the dividend assumption also affect the projection.
Test the assumptions
Retirement projections are estimates, not promises. Try a later or earlier retirement age, different spending levels and more conservative return assumptions. Seeing how sensitive the result is can be more useful than relying on one forecast.
Kira your EPF path
KiraFirst's Retirement & EPF planner compares your projected retirement savings with an estimated amount needed to support your chosen retirement spending. Use it as a planning tool to understand the direction of travel and the assumptions driving the result.