Do you know that October 31 is World Savings Day?
This day was celebrated for the first time in 1924, during an international banking congress in Italy. It was meant to help people around the world see the value in saving their money in a bank, rather than keeping it under their mattress.
More than 90 years later, we are still reaping the benefits from it. Whether it is setting aside money for retirement, our children’s higher education, or just for a rainy day, we have learnt the importance of saving. However, how good are Malaysians actually at saving?
The Malaysia National Strategy for Financial Literacy (2019-2023) found that of Malaysians who claim to save, 84% of them typically withdraw their savings at the end of the month to cover their daily expenses. In fact, one in five Malaysian working adults did not save at all in the last six months.
While most of us have the intention of saving, it may not be easy to consistently set aside a sum of money every month. For parents, it can be even harder because of all the additional and unexpected monthly expenses.
When it comes to planning for your children’s education, it may seem like a daunting task. A report by OCBC Bank revealed that studying at a highly-ranked public university could cost between RM7,500 to RM15,000 for the entire length of study. According to a university cost guide by Public Mutual, that amount could go up to RM37,100 per year for private universities.
Thankfully, the National Higher Education Fund Corporation (PTPTN) wants to make it easier to save for your children’s education with the National Education Savings Scheme (SSPN).
Throughout the month of October, PTPTN has been running its SSPN 2020 Savings Month or “Bulan Menabung SSPN 2020” with the theme “Superhero”. The programme is organised in conjunction with World Savings Day, October 31, which is also the date when the programme ends.
The great thing about SSPN is that it allows you to start saving for your children’s education with just a minimum deposit of RM20. After opening an account, you can top-up your saving as much as you want, whenever you want.
SSPN gives you lots of benefits, including up to RM8,000 tax relief, and free takaful coverage when your savings hit RM1,000. On top of that, you get to enjoy government-assured savings and also competitive dividend rates. In 2019, the dividend rate was 4%.
To put things in perspective, if you set aside RM50 per month for 18 years, you would be able to save up around RM15,000 based on these rates.
Click here to find out more about SSPN and how you can start planning for your children’s education.