Today, one of my staff is retiring.

Shoo! One of my staff is retiring today at 55 and I attended her farewell lunch with my colleagues today as well. Is 55 too early for retirement ? Well, we have a tough discussion on the way to lunch and back and I told her that she have a few good years in her. My Company is not offering her an extension because we have a tight HR policy but I have recommended her to work for my friend. She told me that she needs a rest. Yes, by all means but not too long. I told her that the job opportunity will not be waiting for her and she might lost her momentum in her working life.

Basically, I told her that we should keep our savings intact and if we do nothing, we will use our savings and it is not surprising that the savings will dry up very fast. I recommended to her to keep working as the income will be very useful and our savings remain intact. At this age, she can negotiate with her  new employer for a flexible working condition and compromise by getting reducing her salary. This is a matter of negotiation and to have enough time to wind down until the appropriate age of retirement.

In banks and government bodies today, the employers have extended the retiring age to 58 or 60 and in Singapore, it is at 65.  Maybe, it is a social problem because if the people retire early and with the extended life span, it will be difficult for the Government to bear the payment of the retirement gratuity.  In Japan, those retired senior citizen is getting more and more by the year and they have a longer life span because of advance medical care while the population is shrinking because of birth controls by the young couples and this post a big social problem as the contribution to the retirement gratuity is less than the payout to the senior citizens. This is a real problem and if it is not properly handled , it would caused a major financial crisis in the long run. Well, that is Japan and in Malaysia, the massive outflow of funds could also have a similar impact.

Coming back to my staff, I told her the medical expenses is escalating and soaring high. In 5 or 10 years, most of our savings would be used for medical care. It is not surprising as inflation is at about 3 to 4 % pa and it just build up. If our health is manageable, we could survive comfortably but if we are seriously sick then the formula would be different.  I have two relatives who have the big "C" and one is spending RM1,200 per month to extend his life and another is more serious  and he is spending RM50,000 a month to keep him living on.  This is a serious factor we have to face and be ready for the raining days.

So, if we have the money , retiring at 40 or 50 is not an issue but if we have just barely enough, it is better, we work a few more years to pile up our savings to face difficult times.  We have to balance our feelings, our savings and our comfort in life.  It is difficult but we have to face it squarely.

Namaste.