I was born in Malaysia and one of my goals is to retire back in the country where I was born. Why? Relative to Singapore, the cost of living is lower and the pace of life is slower. Don’t get me wrong. Singapore is a nice place to live in but that is provided you have a nice stash of cash to enjoy the comforts that it can offer.
The issue of how much money one needs to retire in Malaysia depends on a great deal of what is the kind of lifestyle you want to lead. I have given my version in this post of how much you need to retire in Malaysia. For those who are too lazy to click on that link, it says I need $2200 Sing dollars to have a pretty good life in Malaysia. However, that number is just for me. Let’s look at other scenarios and see how much money is needed to retire in Malaysia.
How much do I need to retire comfortably in Malaysia
If I am aiming for a comfortable life, the $2200 number should cover it as it includes paying the mortagage for a large house, paying the loan for a car and having RM1200 to spend on food. However, that amount did not include traveling expenses. If you want to retire comfortably in Malaysia while being able to travel, here are some additional numbers to include:
- For folks who want to travel to more far off locations: adding another SGD500 to your monthly budget will be sufficient for you to take 2 trips in a year.
- For folks who want to travel to Asian countries: adding another SGD300 will give you enough to travel to 3 southeast countries that includes HongKong and Taiwan.
Overall, for those who want to travel, the total monthly income you need might be around SGD2700 to SGD2500. That is still very low when compared to living cost in Singapore.
How much to retire in Malaysia if I have little money
The good news is that if you have little money, Malaysia is still a good option to retire to. Avoid cities such as Penang, Johor Bahru, Kuala Lumpur etc. Go for smaller cities such as my hometown Batu Pahat. In such places, the cost of living is much lower as can be seen below:
- Mortgage payment: the price of a terrace house is around RM100,000 in my hometown or SGD45,000. Assuming a 4% interest rate, 30 year repayment and a 90% loan, you need only to pay SGD190 per month! That is insane! If we want a shorter loan, say 10 years, it is still only SGD400 per month.
- Car payment: let’s assume we get the same car as mentioned in my previous post, it will be SGD165 per month.
- Living expenses: Aggregating all the expenses on food, utilities, medical, insurance, parent’s allowance from the previous article, the total is about SGD1500. If you don’t have much money, you can reduce the allowance from SGD700 to SGD300 and your food expense from SGD500 to SGD250. That will give you about SGD850.
Adding these 3 numbers will give us SGD1415. This is a very doable number in terms of living cost. Much much lower than the SGD6500 that I need now to live in Singapore.
Such a low living expense means it is easier for you to build your passive income streams to a point where they can cover the expenses. In fact, you can probably do it in less than 3 years if you followed my path.
So, why am I not retired in Malaysia yet?
After running through the numbers, I can actually retire now in Malaysia if I want to. So, why am I not?
Answer: wife does not like.
My wife has become customsed to the lifestyle in Singapore so she thinks retiring in Malaysia is a comprise. I disagreed and see it as better way of life. Anyway, we have an agreement that if we do manage to sell our current Singapore condo for 2.5 million dollars in 10 years time as part of my early retirement plan, we will move back to Malaysia. This is why I am still here whereas I could be retired already and enjoying a nice cup of ice blended chocolate.
I hope these two articles about retiring in Malaysia has given you some information on how much you money you really need. If you have more questions, leave some comments please as I have yet to receive a single comment on this 5 month old blog. Sheesh!