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8/12/2019 Datuk Syed Inceif
1/21
INCEIF 201 2.
PRIVATE RETIREMENT SCHEME:An Academic & ShariahPerspective
6th September 2012
MFPC & FPAM Financial Planning Seminar 2012
Bukit Kiara Equestrian & Country Resort
PROF. DATUK DR. SYED OTHMAN ALHABSHI
8/12/2019 Datuk Syed Inceif
2/21
INCEIF 201 2.
Introduction
What is PRS
The Associated Advantages
Caution On Some Risks
Involved Some Shariah Issues and
Challenges
Conclusion
2
CONTENTS
8/12/2019 Datuk Syed Inceif
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INCEIF 201 2.
Introduction
What is PRS
The Associated Advantages
Caution On Some Risks
Involved Some Shariah Issues and
Challenges
Conclusion
3
CONTENTS
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INCEIF 201 2.
INTRODUCTION
4
The need to plan for retirement
Everyone grows older
Need to work hard when young to accumulate as much
wealth for old time sake Costs of living escalates every decade
Major cost is medical
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INCEIF 201 2.
INTRODUCTION (Contd)
5
If my body was a car, this is the time I would be thinkingabout trading it in for a newer model. I've got bumps anddentsand scratches in my finish and my paint job isgetting a
little dull...But that'snot theworst of it.
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INCEIF 201 2.
INTRODUCTION (Contd)
6
My headlights are out of focus and it's especially hard to seethingsup close
My traction is not as graceful as it once was. I slip and slideand skid and bump into thingseven in the best of weather.
My whitewallsarestained with varicose veins.
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INCEIF 201 2.
INTRODUCTION (Contd)
7
It takes me hours to reach my maximum speed. My fuel rateburnsinefficiently.
But here's the worst of it. Almost every time I sneeze, cough
or sputter, either my radiator leaksor My Exhaust Backfires! What do you think would happen if you dont plan for
retirement? Retirement is not just to sit around doingnothing, but you must have an active and healthy quality life,not sickly boring life
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INCEIF 201 2.
INTRODUCTION (Contd)
8
The Role of compulsory Pension funds
Basically to provide funds for retirement
You only get what you save
You can enhance it when you invest You should plan not only for your current but also your
future needs
More than often, the EPF is not sufficient if not well
planned
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INCEIF 201 2.
INTRODUCTION (Contd)
9
Theneed for other pension schemes
PRSis one
Can also take up good investments in various investment
schemes,such asunit trust, real estate, etc ASN,ASB, etc.
Gold bars
Should also think of insurance and takaful
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INCEIF 201 2.
Introduction
What is PRS
The Associated Advantages
Caution On Some Risks
Involved Some Shariah Issues and
Challenges
Conclusion
10
CONTENTS
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INCEIF 201 2.
WHAT IS PRS?
11
A voluntary pension scheme
Forced savingsfor the future that suits individual needs
Well regulated to avoid any unfair dealings
8/12/2019 Datuk Syed Inceif
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INCEIF 201 2.
Introduction
What is PRS
The Associated Advantages
Caution On Some Risks
Involved Some Shariah Issues and
Challenges
Conclusion
12
CONTENTS
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INCEIF 201 2.
THE ASSOCIATED ADVANTAGES
13
Possibility of growth in the fund because of the large scale
Allows planning and management of funds for the futureneeds
Good for employersto retain talents Supportsbetter quality of life
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INCEIF 201 2.
Introduction
What is PRS
The Associated Advantages
Caution On Some Risks
Involved Some Shariah Issues and
Challenges
Conclusion
14
CONTENTS
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INCEIF 201 2.
CAUTION ON SOME RISKS INVOLVED
15
Thefund issubject volatility of the capital market
It doesnot pay to begreedy
It is better to have small returns than chasing for higher but
very risky returns
8/12/2019 Datuk Syed Inceif
16/21
INCEIF 201 2.
Introduction
What is PRS
The Associated Advantages
Caution On Some Risks
Involved Some Shariah Issues and
Challenges
Conclusion
16
CONTENTS
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INCEIF 201 2.
SOME SHARIAH ISSUES AND CHALLENGES
17
Shariah compliant investments
Distribution upon death subject to Faraid
Should consider zakat payment
Be helpful to otherswhen you can
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INCEIF 201 2.
Introduction
What is PRS
The Associated Advantages
Caution On Some Risks
Involved Some Shariah Issues and
Challenges
Conclusion
18
CONTENTS
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INCEIF 201 2.
CONCLUSION
19
PRSisan excellent avenue for personal financial planning
It provides opportunities for better quality of life atretirement
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INCEIF 201 2. 20
Q & A
THANK YOU
8/12/2019 Datuk Syed Inceif
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INCEIF 201 2.
Tel:Email:Website:
+603 7651 4000
www.inceif.org
Prof Datuk Dr Syed Othman Alhabshi
Chief Academic Officer