How to manage Malaysia’s silver tsunami

Malaysia faces a looming "silver tsunami" as its population greys, with the Department of Statistics Malaysia projecting that 14.5% of citizens will be over 65 by 2040. Currently, 8.4% of the population is aged 65 and above, a 0.4% jump from the previous year. This aging trend has prompted policymakers to consider how to best prepare for the demographic shift.

One proposed solution is the newly introduced EPF i-Legasi facility, which allows retirees aged 55 and above to transfer a portion of their savings to a spouse or child. While some argue that this scheme is a step in the right direction, experts believe it needs significant improvements. One concern is that the RM650,000 adequate savings threshold is too high, excluding many Malaysians who would benefit from such a facility.

Additionally, the current structure only recognizes spouses and children as eligible recipients, leaving out childless retirees and those relying on siblings or extended family for support. Critics argue that i-Legasi must be part of a broader, more comprehensive retirement-adequacy strategy in Budget 2027. This strategy should include widening eligibility, lowering the threshold, and integrating complementary measures for those who may never reach the savings target.

Ignoring these issues could leave millions of Malaysians underprepared for old age, with potentially devastating consequences for both individuals and families.