What is PRS?
PRS is a voluntary long-term
investment scheme to accumulate savings for retirement.
Who can apply PRS?
Anyone whom is 18 years old and
above is eligible to contribute to the PRS. You will need proof of
identification.
How to enjoy up to RM3000 tax
relief?
(i)
Individual tax relief
Tax relief
of up to RM3,000 per annum will be applied on taxable income, for individual
contributions for the first 10 years.
(ii)
Employers
Employers
contributing to PRS on behalf of their employees are eligible for a tax
deduction on their contributions above the EPF statutory rate, up to 19% of the
contribution. Please note that the employer tax relief is only applicable on
the company as an entity.
How to
entitle for RM500 Youth incentive?
Applicable
who youth age 20-30 whom has accumulated a minimum gross contribution amount of
RM1,000 within a year, government will contribute RM500 per qualified person to
be used to purchase units of PRS in the PRS account.
Why we
should invest now?
For
example, we have two person, Mr Now and Mr Later.
Mr Now
start his investment immediately at age 20, for 10 years only.
Where else
Mr Later choose to enjoy his life now, delay the investment for 10 years and
only invest when he is at age 30, more financially stable by then and continue
invest for 25 years until he retires, age 55
Let's take
a 8% growth annual with RM500 monthly.
Mr.Now:
Contributes RM500 monthly for 10 years with total investment of RM30,000.
Mr. Later:
Only starts his investment at age 30 and contributes for the next 25 years till
55 years old.His total investment is RM75,000.
Who do you
guess will be able to accumulate more money?
.
.
.
.
.
.
.
.
.
.
.
.
The answer
is...
At the age
of 60,
Mr Now will
accumulate a total amount of RM510,090 with total investment of RM30,000.
While Mr
Later will accumulate a total amount of RM375,872 with total
investment of RM75,000.
A total
difference of RM134,000!!!
Shocking
right? How is that possible?
Look at
graph below:
Even Mr Now
only invest for 10 years. His money continues to grow exponentially and surpass
Mr Later all the time! That's the power of compounding!
So don't
wait any longer, start and invest now!
TIME IS MONEY.
For more PRS info, you may contact Wan Khim (pangwankhim@vka.com.my), a
licensed financial planner, who can distributes products from multiple PRS
providers. Thank you and have a nice day! =)
