MANY retirees, especially those in the lower income group, are at a crossroads in their life over how they would fund their golden years, but many dont consider the impact it would have on them emotionally and psychologically. It is just as important to consider the emotional and practical implications of these lifestyle changes, as many will be in for a shock when they reach retirement.

The following is based on Scottish widow research studies: while money worries were the biggest challenge retirees faced after they stopped working (30% of them stating that they did not have enough money to enjoy their new free time to the full), many people also highlighted the lifestyle challenges that came with the transition .

In Malaysia, when private sector retirees in the lower income group retire at 55, the most they would have in their EPF is about RM50,000. This amount of money would sustain them for between three and 10 years, depending on their lifestyle and spending pattern.

Faced with a sudden lifestyle change, one in seven (15%) retirees said that one of the biggest challenges they faced was coping with their reduced social life after leaving work.

Further to this, nearly a quarter (23%) of retirees missed the sense of structure in their life that came with working, leaving them at a loss over what to do with all their free time, and three in 10 found they simply didnt have enough money to fully enjoy their new life.

The psychological effects of retirement are also a major concern with 29% of retired men, who say that the transition from working to retiring was hard to deal with, compared to 24% of retired women who felt the same.

Understanding the current situation with the rise in the cost of living and the increase in life expectancy of Malaysians to 75, the Government has proposed 60 as the retirement age for private sector employees, with a pension scheme plan at a discussion stage with various stakeholders.

However, the expectations prove to be worse than the reality, with the Scottish widow research studies revealing that more than two-fifths (43%) of over-50s expecting the transition to retirement to be harder than retirees actually find it to be.

This added anxiety can be seen in the increased concerns that future retirees have about the challenges they would face when they stop working, including more than one in eight (13%) who wont be in good enough health to enjoy their retirement, around one in five (22%) who dont want to leave a job that they enjoy, and a further one in eight (13%) wont know what to do with the extra time on their hands.

The magic formula is to stay healthy, maintaining social support, keeping spiritual life and finances in order, and developing a daily routine that can help prevent stress after retirement.

Original post:
Retirement challenges