A recent international survey by HSBC Bank has indicated that 57% of local mass affluent respondents are most concerned about retirement. Revealed in the inaugural HSBC Quality of Life survey, these Malaysians also said that they will need an average retirement savings of around RM3.9 million to retire comfortably.

More specifically, millennial respondents (25 to 39 years old) said that they need about RM4.86 million for a comfortable retirement, while Gen X respondents (40 to 54 years old) need a little less at RM4.53 million. Boomers (55 to 69 years old), on the other hand, said they need RM2.57 million. Aside from that, the respondents shared that their top three retirement-related concerns include a decline in physical health, higher healthcare costs, and inflation that will reduce the value of their retirement savings.

Despite these worries, the Malaysian respondents also said that they aspire to retire early at the age of 57 years old – three years before the mandatory retirement age in Malaysia. 44% said that they will continue to work after retirement, while another 44% said that they will not; a remaining 12% is undecided at this point.

Additionally, the respondents revealed that they expect to rely on personal savings as their main source of income after retirement, followed by retirement savings schemes, then individual stock fund and bond investments. Meanwhile, at present, their top sources of income include salaries and wages, dividends, inheritance, profit from businesses, and property rental – sequenced in that order.

Another notable detail that was also unveiled in the survey is the fact that Malaysian respondents scored 77 out of 100 on the overall Quality of Life index. Briefly, this is a special index that measured respondents’ perception of a good quality of life, based on three factors: physical wellness, mental wellness, and financial fitness.

Country head of wealth and personal banking for HSBC Malaysia, Linda Yip said that the Quality of Life survey paints an interesting representation of the holistic needs of the mass affluent segment in Malaysia. “They aspire to retire early, but are also cognisant that they would need to build significant financial savings to retire comfortably. They are also concerned about their physical health and medical inflation that could eat into their retirement savings,” she said.

Yip further highlighted the importance of financial planning; it is not enough in the long run to merely rely on salaries and inheritance as sources of wealth. Instead, it would be wise to build a diversified and solid financial portfolio, consisting of steps like contributing to a pension plan and investing in financial assets that best suit your needs.

HSBC’s Quality of Life survey was conducted across different generations of mass affluent individuals in nine markets – including Malaysia, Singapore, China, India, Mexico, as well as the US and the UK – with a total of 2,250 individuals surveyed. You can read the full survey report here.

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• HSBC Quality of Life Survey
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