Even middle class will sacrifice a percentage to the lower income group if tiered. I am definitely against it.

Those who has more funds in EPF, is due to their own effort in either; 1. studied well, and got themselves good paying jobs 2. doing well, and self contribute as well
And because of that, the compounding effect on their balance is well deserved.

Example : 6% dividend
A has 1mil in EPF = 60k
B has 500k in EPF = 30k
C has 100k in EPF = 6k

If tiered, EPF, A might get less than 60k, B gets same or less 30k and C gets more than 6k.

Example : Tiered
A has 1mil in EPF = 58k
B has 500k in EPF = 30k
C has 100k in EPF = 6k + 2k from A (or more if B gets less as well)

Just a simple minded possible scenario I am thinking of. Even B might be affected and then C suddenly has even more. This is pure leeching from those who worked hard to get where they are. Not only are they paying higher taxes, now they want to reduce their EPF dividends, to give to those who are on low income/low EPF funds? Yet it is mostly their funds that are being invested to get returns for EPF. Yes, tiered dividends won't affect EPF earnings. It is the distribution from that pool of dividend payout that would be unfair if tiered. All to support low income earners. Shouldn't that be the responsibility of the Govt? To create more jobs, to lower cost of living, to reduce poverty? It should not be the responsibility of the keeper of our retirement funds.

Been a long day today so far, a bit worked up when I see people supporting tiered dividends.

How true that is. At the very least, when we are no longer there, they are savvy and street smart enough to be self reliant. But thankfully, I have none

If one has several properties, and can't generate rental returns to cover those expenses, then his/her financial planning is f**ked up to begin with. But you are on point about hidup bermaruah



I intend to retire in about 2 years when I am 50 and these will be my projected expenses per month. I have no children to pass on any monies left with me, thus I have no issue spending it all till the day I leave this godforsaken planet Will be selling my beloved cars and only have my wife's new HRV for our use, and GRAB if ever both needs to go out separately, which is not often.

I am able to generate about 30+% over the yearly amount required, hence unless any super duper emergency, I should be good. And this is before touching EPF money. This assuming I don't touch capital. But as I age, eventually the capital will be used as the years go on. And whatever remainder, and the property/asset will be "willed" to the people closest to me. Travel now, before I get too old. I think once I touch 60, road trips and local excursions will be enough. Or just short distances travels like S'pore, Thailand etc. I get restless and fidgety on long haul flights of late.

If I missed out anything, let me know. The older I get, my priorities gets changed. This is when I look back, and bitch slap myself for wasting over RM500k on cars over the last 12-15 years of changing cars so frequently, and modding them. So, for the younger ones here, learn from my mistakes Had fun? Yes, but looking back, foolish.

Back to the topic of EPF, articles that says most Malaysian's don't have RM1k, or RM10k in EPF are just trying to encourage Govt to allow more withdrawals. With previous minimum wage of RM1.2k, say about 20% of employee+employer contribution, in 5 months, there would be more than RM1k. Anyone that has less, they either just joined the workforce or they stopped and became their own business via self entrepreneurship.

RM700 for the wife, once every 6 mths. Better to estimate more than less. 😅

As for me, almost every month as I don’t fancy my hair too short. I try to maintain a budget to at least maintain current lifestyle rather than cut everything. The time to reduce them is when I can no longer generate 60k per annum.

Exactly 😜

I believe historical data will show EPF dividends has always been higher than FDs. It rises and falls in tandem to EPF, for as long as I can recall without checking. When interest was at 7.x%, EPF div was at 8.x%. I'm guessing your funds are in other form of investments which can be liquidated quickly to provide need cash, when necessary, hence 10k in savings is sufficient as it is.

Logically, no abuse in my opinion. Say a B40 has RM50k in KWSP. A M40 or T20 has RM500k in KWSP. If EPF dividends pays 5%, each gets a fair share of their investment worth, RM2,500 and RM25,000 respectively. In fact, if the M40 or T20 voluntarily deposit a further RM500k, technically, it provides EPF more money to diversify their investment. If the returns improve in subsequent years with higher dividends, the B40 will benefit in terms of % returns, even though he/she has the same amount with no additional deposits. The pie is shared proportionately as there isn't a tiered dividend payout ratio, which I agree should not be discriminatorily implemented, to punish those who are prudent with their lives.

Perhaps a method of reducing is to ease the withdrawals for those exceeding a certain threshold based also on age. Say, a 35 year old already having RM300k, is allowed a certain % withdrawal, likewise for a 40 year old having an excess of 400k and etc. And if bigger fund size is an issue, then limit the voluntarily deposit amount per annum. EPF should not be burdened to manage the money of well to do people who don't know where else to invest their spare cash when there are so many investment vehicles out there That's not the core function of EPF.

RM240k x 5% dividend = RM12k pa.

Theoretically, RM240k will last you a lifetime of RM1k monthly withdrawals if EPF consistently gives no less than 5% pa. Then as we age, we start increasing to 2k a month and so forth to match inflation, then eventually, it will drain the total sum away. This is good for those who has already planned their financial retirement without touching EPF. EPF is like spare money when needed. And if unfinished, leave it to nominee. But knowing people, even with financial literacy, some cannot tahan touching that money. That's why so many old people have so little money left after 5-10 years after withdrawal. Sudden influx of money, spend it and poof, gone before realizing it.

But seeing EPF the way it is, people are beginning to feel apprehensive to leave their money in there.

It's not about possible or otherwise. The Govt and/or EPF or even from some glue sniffing politicians always issue statements to say how many % of EPF members has less than RM10k savings. The calculation shows by 3rd year, a member would already have RM10k at RM1.5k salary even without increment. 11%+13% contribution would add RM360 per month to the account.

The high no of members with less than RM10k are from the likely from following categories:
1. Just entered employment
2. Entered employment, then quit to do GIG or be own boss or becomes unemployed. No further contribution.

It is almost impossible that, even with withdrawal for home purchase and what not, an employed person has less than RM10k after more than 5 years of working. All these statements are unwarranted and without providing factual information on who these groups of people are.

If someone stops at RM9,999, with 5 years of dividends of 5& pa also will give your EPF balance of RM12,761.00 by ABSOLUTELY DOING NOTHING WITH THE ACCOUNT. In 25 years, RM34k without doing anything. Now just imagine if with increments.

If one has RM2,000 in EPF, it will take 34 years of doing nothing with average 5% interest to reach RM10k. So, if one left employment at age 23 with RM2k in EPF, at age 55 pun won't have RM10k.

This post has been edited by McMatt: Jan 27 2025, 05:53 PM

Tikam 5.85%. Above that will be bonus. Agreed with a comment that hyping up a better dividend rate is never a good thing, unless FM2 knows it's considerably better. Otherwise, 0.1% higher pun higher jugak.

This is a narrative that they paint, to show how people are suffering. But in actual fact, someone earning RM2k a month will have RM5,520 in EPF after 12 months, given the 23% total contribution. This does not include dividends. Within 2 years, they would have exceeded that, even if they were to withdraw their account 3.

So, I always puke when politicians one after another keep spewing nonsense.

Even with current minimum wage RM1700, it would be almost RM5k by end of 1st year with dividend. And for those who don't have? They most likely started work, opened an account, then left for GIG economy or own personal business, hence no contributions. That is no one's fault why they have less than RM10k. Perhaps they make better money with their GIG/business, but cry about not enough money in EPF. The data is flawed. Just saying what % has what amount is just to stir emotions and make people angry.

I have a colleague who joined the company 12 years ago as a freshie with very very little pay, accounts clerk sahaja. As of now, just exceeded 6 figures with all the added dividends and additional contributions from increments and bonuses.

To me, if someone continues in the employment sector, I don't grasp why MAJORITY as you described have less than RM50k. I don't think I have anyone within our organization, new staff, old staff, young, old, low salary grade that have less than RM50k. Almost impossible. Withdrawing for house purchase, or other allowable withdrawal is a poor excuse for having less than RM50k. They have, but it was withdrawn. Same like during Covid days, when numerous withdrawals were allowed. Sudah pakai mah, now cry lor.

I get it when it is withdrawn for legit emergency reasons. But many do what? Renovate house, buy phone, buy car, buy gold, go holiday. Yes, I have colleague who withdrew to buy gold, some withdraw just because they can, even though they don't need it.

Ok, enough morning rant