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Only 3% of Malaysians can afford to retire, says EPF

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An official says that 54% of EPF members aged 54 would have less than RM50,000 in their savings account by the end of this year.

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Free Malaysia Today
Covid-related withdrawals over the past two years have left EPF savings at a critically low level, a forum was told today.

KUALA LUMPUR:
Only 3% of EPF contributors can afford retirement, an official of the Employees Provident Fund said today, noting that Covid-related withdrawals over the past two years have had a massive impact on the savings of contributors.

EPF chief strategy officer Nurhisham Hussein said the Covid-related withdrawals, namely i-Sinar, i-Lestari and i-Citra, resulted in the EPF savings of many members below age 55 reaching critically low levels.

Should another round of withdrawal be permitted, he said those who had withdrawn from their EPF savings would now need to work an extra four to six years just to cover the amount that they withdrew over the past two years.

Since it is unlikely that the retirement age will be raised, they would not have enough for their retirement, he said.

He said 80% of Malaysian men and 90% of Malaysian women are expected to live until the age of 60, while one out of three men and two out of three women will reach 80.

“We now estimate that only 3% of Malaysians can afford to retire,” he said at a forum by Perdana Fellow Alumni Association.

In his presentation, Nurhisham said by the end of this year, 54% of EPF members aged 54 would have less than RM50,000 in their savings account; a majority of those who withdrew their entire EPF savings upon reaching age 55 would use it up within two to three years.

He noted that the withdrawals were allowed due to the extraordinary circumstances.

“We are very sympathetic to the plight of our members and hope that the (withdrawals) had achieved the intended purpose of helping them financially,” he said and noted that the reopening of the economy and the measures announced in the 2022 federal budget should help relieve the pressure on members.

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