KUALA LUMPUR, Nov 20 ― Less than 10 per cent of the country’s Employees Provident Fund (EPF) contributors can safely expect to live above the poverty line when they turn 55 next year, according to figures given by a deputy minister today.
Deputy Finance Minister Datuk Ahmad Maslan revealed to the Dewan Rakyat that just 8.9 per cent of EPF members have savings of more than RM201,000, noting that the government has estimated a minimum of RM196,800 to live on for 20 years after retirement based on a monthly earning of RM820, which is the poverty line.
Ahmad said during Question Time that 3.9 per cent have savings of between RM201,000 and RM300,000, 1.8 per cent have savings of between RM301,000 and RM400,000, 1 per cent have savings of between RM401,000 and RM500,000, 1.6 per cent have savings of between RM501,000 and RM1 million, while just 0.6 per cent have savings of more than a million ringgit.
Should retirees need RM2,000 a month to get by, a nest egg of RM480,000 is required, which only about two out of 100 EPF contributors currently have.
“We want to inform you that the EPF fund is a huge fund. It has RM597 billion. It’s the biggest fund in Malaysia,” said Ahmad.
The deputy minister also confirmed previous reports that that 69 per cent of EPF members have less than RM50,000 in their accounts.
Harveston Wealth Management financial adviser Annie Hor told Malay Mail Online last month that retirees would need at least between RM1,000 and RM2,000 a month, noting that medical expenses increase with age.
News agency Bernama reported last Monday EPF’s proposal to increase the age limit for the full withdrawal of retirement savings from 55 to 60, since the retirement age has been pushed to 60.
The Congress of Unions of Employees in the Public and Civil Service (Cuepacs), however, reportedly opposed the proposal, noting that some may choose to retire before turning 60.
Thanks to Mr TSK for sharing this.