Let say you are now having a take home pay of RM5,000 a month and with this amount you are financially confortable and happy. Not taking into consideration inflation and future value of money, all you need to have in your investment can be calculated as follows:
Let assume that you can invest in ASB or unit trust earning an average return of 10%. The amount of money you need a year is RM60,000 (RM5,000 x 12 months ). Therefore the amount of investment you need to invest is RM600,000 ( RM60,000 / 10% ). It is only after the first year you are allowed to draw RM5,000 a month. The caveat here is you have to wait for 1 year before you can pay yourself RM5,000 ( maximum ) a month. The principalhave to left intact all the time.
If you need RM10,000 a month, the amount invested is RM1,200,000. It is not impossible for a retired husbang and wife to come out with combined EPF of RM1.2 million.
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