B40 and M40 people are there for gov to take advantage off... and for the then FM to help his buddies in banks.

assuming you never withdrew from EPF and you had been a salaried persons for majority of your working life, a low % could mean one of the following:
a) a very high savings rate... like 40% of gross pay
b) a superior investment skill better than EPF portfolio manager
c) some or a lot of good luck

I am just at almost 20%, which i attributed to me starting late working in Malaysia...

time... need time also... the greatest of the 4 dimensions...

just 1K per month into EPF from 22 years of age... at age 55 will have 1 million in EPF.
that is only a salary of around 4.3K rm per month without any increment.

I guess if one's salary is 43K rm per month, that will give 10 million in EPF. Now that is HIGH EPF balance. Top 246 persons. haha

you've partially answered your question already.
Lets say your gross salary is 10K. 11+12% = 23% of 10K, ie 2.3K will go into EPF.
You also mentioned that your savings is more than 50%. so that is like 5K rm into your DIY investments.

at start, assuming your DIY skills is same same as EPF returns, that would mean EPF portion is 2.3/(5+2.3) = 31% of your networth.
of course, if your DIY returns is higher than EPF's, the EPF portion will shrink as time passes.

btw, 50% savings rate is very high... because that leaves only like 20% of one's pay for spending. In this example, it is like 2K monthly spending on a salary of 10K. Super impressive really.

Well, just need to work backward/with different numbers on why others said their EPF portion is high.
In the example (using your scenario), the EPF portion is 31% of networth. That's from a saving rate of 50%.

But a normal person, most probably the saving rate is closer to 15%. based on that, EPF portion would be 2.3/(1.5+2.3) = 61%.

(haha.... btw, i didn't mean anything with 2K spending amount. I just used the parameters as described by yourself, and asssumed a salary of 10K rm since I don't know your salary. 10K is a simple round number easily scalable)


This example also shows why if someone has more than 1 million in EPF, very possible the person can have many more millions elsewhere. It is all about the ratio. Say for your case, you said EPF makes up 15%: so if you have 1 million in EPF, then you have like 5 million elsewhere. More often than not, a normal person would take out their fund from EPF the first chance they got.... and if they still have 1 million inside, well......

i think billionaires don't have to worry... they just hire 24/7 doctors, nurses, nutritionist, cooks... and just follow whatever they say.... these specialists can keep track of his/her intake and health...

I am guessing this is why a certain Dr is still alive...

yes, i would have to say that you are a odd one out.

u by any chance a biz owner?

i'm sure as a billionaire many times over, he can afford to buy as much blood as he needs....

somemore, being such a VVIP, he anytime can seek treatment anywhere and don't even need to wait in a queue.

power and money... what else can a mortal wish for?

end Feb announce...
i already assumed it will be 5.0% in my spending budget for 2023
but hope it is 5.8% lar...

I am just hoping politicians being politicians.... just declare a good dividend yield from all those reserve EPF been accumulating all this while and give it out to let all of us feel good.

imagine PMX choose to declare say 4% dividend... everyone will curse him. why be the bad guy?

with 1 trillion assets, 0.5 billion is just 0.5%. So not really sure what it is all about. It could be lighting rod for something else?
but if it is related to dividend, then my guess would be this local reit/education asset needed to be remarked to market and the only way to do so properly is to sell to realize the cashflow/gains.
maybe this is the extra 0.5% we all are hoping for to get to 5.8% div...

ah.... ok...

without this context, i thought you already know something is going to happen in 10 months time... that would be sad...

what will happen to those assets after you move on?
did you put them in a trust or gotten a will that can be enforced in those jurisdiction? hope you don't mind sharing, as I think I may need to keep those in mind when I get much older.

while not really directly related to EPF...

when one thinks about retirement funds/assets, diversity and safety of capital are key... no longer just about returns.
simple reason: time and energy in general are no longer in the retiree's favor.

So, make sure that whatever plan/strategy one execute, needs to be robust. If possible, aim to see if one's plan can afford one to live in a few different countries... I pick MY, SG, JP, AU, UK, US.... at least can run to those countries should other countries (ie malaysia for now) be in trouble.

edit: obviously MY cost is the cheapest for now... but what if MYR goes up to 2.88 against usd?

This post has been edited by Wedchar2912: Jan 16 2023, 03:39 PM

if usd crash, yeah, I also believe the impact will be negative to EPF's return. But don't really know how much of the close to 40% overseas investment is denominated in USD.
The good thing is when our ringgit crashed from 2.9x to 4.7x, EPF didn't declare oversized dividend, which by right they could have (they did declare good div, just not supersized).... during the period, our interest rate crashed too... so even the malaysian govies would be having oversized gains.
so if we didn't get the full benefits the past 10 years... hopefully means plenty of reserve to spare?
(previous years naysayers kept on saying money in EPF is bad while its better to invest directly in usd. But as we can see, EPF is a large pension fund, and has already diversified a large chunk into FCY denominated assets)

on selfish note, my fcy exposure is still below 50%... so a stronger MYR is better for me until I get my exposure closer to 50%.

I think cos most of us were "english" educated or influenced... hence been conditioned since young that anything west is good, even when we know thats not universally true for everything

But the problem is S&P dropped almost 20% in 2022
while our ringgit weakened about 6% in 2022. net effect is down 14% almost.

i guess that is financial planners always say that income and expenditure should be in same currency to remove currency risk.

if it is opposite, then most probably 14% gain on whatever EPF invested... which can signal got more reasons to give high dividend...

now that we know instead it is 14% loss, all it means is that EPF will find it hard to give good dividend...

but at end, it all depends on what EPF and gov of the day wish to give as dividend.

was trying hard not to comment about this because not related to EPF.

But in all seriousness, if we are talking about leakages due to corruptions etc since 1970s, no way it is 50 billion usd. Do we really think all leakages are just in the order of 1 billion usd range per year (present value based on 2022)?

Just for fun... there was a certain politician who in the national arena was not the biggest politician, but in charge of KL... networth of 1 billion ringgit and this is after all the spendings and I am very sure, doesn't include everything.

that is one chap. and we still think 50 billion usd is the right number?

ps: obviously I don't know whats the real number.. that's the sad part.

at 10%, I think you can run naked and also belanja dim sum.... haha

Ai yoh. Apa susah. For those selfish enough to think tiering is a good idea, just set the max amount a person can have in epf to 200K rm and force those with more than that to withdraw they money.

See how fast epf large aum disappear and how fast epf return will crash.

Silly selfish leeches. Too many around.