No Backup Plan? Think Twice Before Opting For Early Retirement, PSD Tells Civil Servants

PUTRAJAYA, Sept 11 (Bernama) -- Civil servants planning to opt for early retirement must ensure they have a strong support plan in place, such as a second career, alternative income sources, and financial stability, to avoid hardship after leaving government service, the Public Service Department (PSD) has cautioned.

PSD Pension Division deputy director Anom Akmar Mohd Omar said that among the most critical factors to consider before making such a decision are debt obligations, family support, and the ability to sustain oneself without relying on social welfare programmes.

“If someone in their 40s is considering early retirement, they must have a backup plan. They must make sure they have another job lined up, an alternative income stream, or solid support.

“This is to avoid getting to the point where they are deluged in financial issues and end up appealing to reverse their retirement or applying for aid like e-Kasih,” she said during a live one-hour podcast hosted on PSD’s official Facebook page today, which attracted thousands of viewers.

According to Anom, civil servants who apply for early retirement generally fall into two main age categories.

Those in their 40s typically opt for early retirement to pursue new careers, further their studies, join the private sector or government-linked companies (GLCs), take up overseas job offers, or continue a family business.

“For example, someone who started working at 25 may, by 40, want a career change, skill upgrade, or a new job offer abroad. This is part of long-term planning, but they need to be thoroughly prepared,” she said.

In contrast, those in their 50s, nearing the mandatory retirement age of 60, often cite health reasons, a desire to spend more time with family, or challenges adapting to new technologies as their motivation.

“Many say they want to retire alongside their already-retired spouse. Some suffer from health issues like knee pain or osteoporosis.

“A growing trend now is opting for retirement at 55, as they qualify for immediate pension payments,” she noted.

Anom said that the minimum requirements for early retirement include serving more than 10 years and being at least 40 years old.

Applicants must also pass a vetting process by the Malaysian Anti-Corruption Commission (MACC), undergo regular medical check-ups, and have no integrity issues.

“Those declared bankrupt can still apply for early retirement, but must first consult with their head of department and get clearance from the Department of Insolvency. A valid bank account is also required for pension disbursement,” she explained.

She also urged public servants to be financially literate and evaluate the risks involved before deciding to leave service early.

“Early retirement doesn’t just impact the individual. It can affect families and society if not planned properly,” she concluded.

-- BERNAMA