Introduction

Preparing for one’s silver years can feel daunting and too far down the road ahead, especially for young adults in their 20s. On top of that, the area of focus has always been centred around financial aspects of preparing for old age – “you need to buy an insurance now while you are young”, or “you need to save for your retirement”. For young adults who have just started their career and are building up their own savings, income never feels enough. To roughly illustrate, average monthly salary of Malaysians in 2021 is RM3,037 (2022e: RM3,119; based on 2.71% 5-year CAGR increase) while the estimated cost of living for a single person is RM2,031 excluding rent. That leaves around RM1,000 for everything else including rent and savings for old age (via insurance, pension scheme, or any other investment instruments).

Although I do agree and personally advocate readying for one’s old age, I also feel that focusing only on the financial aspect of aging is not the most sustainable solution. In this piece, I will argue (1) with a list of reasons why building one’s financial asset as the only strategy to prepare for aging is not sustainable, and (2) argue instead to focus on preserving and enhancing one’s physiological assets and change our overall thinking about aging.

Planning for aging should be based on when you will need care and support, and not when one reaches a certain age

By United Nations and WHO convention, individuals are only categorised as “aged” in national population statistics when they are 65 years old or older. But with better healthcare, this group of 65 year-olds can live for another 10 to 15 years before needing care and support. Inversely, if we think of “aged persons” as persons with very high risk of handicap and disability, that is, if the rate at which one’s risk of becoming handicapped and disabled instead becomes proportionate to the rate at which you are progressively considered as “aged” as an individual, then many who are not yet in the age category of “65 or older” would already require some type of care and geriatric support. Therefore, technically speaking, an individual preparing for his or her own old age would do best by assessing at which point in his or her life would he or she start needing care and support. The strategy would then be about delaying these needs, rather than just about being financially ready by a certain age.

To evaluate and strategise around an individual’s risk to requiring care and support, two important vulnerability factors can be introduced: (1) handicap and (2) disability. Handicap can be defined as reduced or loss of ability to participate economically and socially, while disability, or becoming “differently-abled” is defined as reduced or loss of ability to perform sets of Activities of Daily Living (ADLs). For example, preparing financially for old age would help mitigate the handicap risk directly as seniors will still be able to purchase goods or services like e-hailing rides for them to travel and meet friends at senior community centers, restaurants, or parks. Being financially healthy also means seniors can afford to buy assistive technology like motored wheelchairs, or hire human or robot caretakers to assist in their daily life e.g., cooking, delivering food etc.

Financial readiness is a good strategy, but being healthy is a better plan

At this point, one must have thought that having ample savings for old age expenses is the go-to strategy but allow this author to list down five reasons why it is not good enough a plan.

1. The solution is heavily reliant on the assumption that older individuals will completely lost the ability to make money (while they may still earn, a term now increasingly coined as the ‘silver economy’). This loss of ability to make money can result from either loss of bodily and cognitive function, becoming isolated or made redundant, and finally having lack of passion or drive to work.

2. Focusing only on financial readiness is myopic, as one should have a longer-term plan to delay or even diminish the age-related risk factors during their early years.

3. Focusing only on financial readiness promotes the “old age is a burden” mindset, whereas the value of age is significant in preserving culture and nurturing inter-generational knowledge transfers. Experience and procedural knowledge can be better leveraged if the seniors are healthy and able to actively be involved in volunteerism and family interactions.

4. Focusing on financial readiness of aging also puts stress on young adults to save more through working more jobs or ride on the hustle culture, just to afford old age, not realising that the physical and mental stress probably hastens the aging process and experience in themselves.

5. There is a lack of control over the result. Inflation, precarious returns on pension funds in recent years, and economic recessions are all external factors that can easily impact how much an individual would have accumulated, by the time they need it.