The Malay Mail Online, Photo Credit to Yusof Mat Isa
clock 20-10-2017
hit 1,787

EPF: Gen Y, Z Should Consider Diversifying Investments

KUALA LUMPUR, Oct 20 ― Malaysians, particularly those between the ages of 16-35, should consider diversifying their investments and savings to avoid having an insufficient retirement fund.


According to statistics provided by the Employees Provident Fund (EPF), 64 percent of its members aged 54, had less than RM50,000 in their retirement account and it would only last four years beyond their retirement, at the rate of RM950 a month for expenses.

(RM950 is the minimum pension rate for the public sector and is thus used as a benchmark by the EPF to guide its members.)

Given this rather alarming situation, the EPF is urging Generations Y (21-35 years) and Z (16-20 years), who constitute more than 50 per cent of members, to reflect on their retirement plan, and is as such, aggressively promoting its Retirement Advisory Service (RAS) to advise and help them protect savings.

EPF Petaling Jaya RAS Adviser, Mogana Murugan said the majority of members had insufficient savings to sustain lifestyles upon retirement.

"Based on the quantum savings base issued by the EPF, the minimum amount in the base deposit is the predetermined amount set by age in the Account 1.

"The basic savings amount is set according to age, where members should have at least RM228,000 (or RM950 for monthly expenses for 20 years) in their EPF account by age 55" she told media during a briefing on the RAS.

She said only 21 per cent or 2.9 million of members had sufficient basic savings based on their age, and contributors were encouraged to engage with financial consultants in considering various investments, and not just depend on the pension fund.

Mogana also said most members aged beyond 55, opt for lump-sum withdrawals and would have fully utilised their savings within three to five years.

"There are cases where individuals spent all the savings at once, and ended up having to live the rest of their lives in poverty" she added.

She said the EPF offered five withdrawal options for contributors aged 55 and above, namely a lump-sum withdrawal, monthly withdrawal, partial withdrawal, a combination of monthly and partial withdrawal, or withdrawal of annual dividends or monthly dividends.

These options are aimed at helping contributors plan their finances and sustain lifestyles upon retirement.

According to Mogana, business owners can also top-up their EPF savings on a voluntary basis, while employees can opt to increase their contribution rate.

"This extra effort by contributors can prevent them from suffering later, as statistics revealed that 85 percent of Malaysians regretted not saving up for retirement" she said.




WHAT DO YOU FEEL ABOUT THIS?

0
LOVE
0
HAPPY
0
SURPRISED
0
SAD
0
ANGRY


COMMENTS
Use a Facebook account to add a comment, subject to Facebook's Terms of Service and Privacy Policy. Your Facebook name, photo & other personal information you make public on Facebook will appear with your comment.

SIGN UP NEWSLETTER

logo
Monthly Column
The staple of your property-related materials. It's all about being ahead of the game and with The Column, you get carefully selected information that will keep you informed and running with the pack. The best news, articles and properties on the market from the Property Hunter portal, conveniently wrapped and ready, just for you.

logo
Weekly Window
Your weekly dose of what's hot and what's not in property. The window is your view into the realm of real estate in Malaysia, curated from our portal based on the most popular pieces over the week. For those who just can't get enough, this is for you. Ain't nobody got time for dailies anymore, weekly is the new daily.