US T Bill 6 months is paying 5.5% . Include FX appreciation, EPF dividend should be more than 5.5% . If lower, EPF can fire their fund managers

If this elephant doesn't squeeze out at least 5.5% dividend yield, I don't know what to say already

If the big elephant posted less than 6%, I think those who have over 1mil may take out the excess to put into High grade bond.

If you explore the bond market, especially government bonds (local and foreign), u can easily get 6%.

Try interactive brokers

Then, u should choose Ringgit corporate bond by GLC. There's no perfect solution. Stay in EPF, get lower yield than 6% and money locked up.

But if EPF dividend stay lower for longer, I think many will start to look for alternatives. Money goes to where it's best treated

Amazing to see big elephant throw them a bone just to keep them alive. Luckily, fintech and global ETFs have opened up a lot of choices for the people.

Either UT change or get eliminated.

In your opinion,what is the return that will trigger capital flight from EPF to other vehicles?

Assuming 4% appreciation, your total return would be 6.5% only. If you deduct repair , maintenance and management, then net return would be lower. That also includes illiquidity and taxation risk.
From investment point of view, I don't think it's better than 6% gov bond.

But from personal point of view, I think I understand your choice

'Investment' in your own career is still the best way to retire comfortably

I totally agree with giving some assistance to children during the time when they most needed it....like buying 1st car, 1st home....some form of help like downpayment.....No freebies....Some parents cut off any form of financial assistance to their children after graduation. They only pass down whatever left after they spent their own funds. By the time they passed away, their children no longer be needing their money because they're already in their 50s. Major events of their life already over & most probably, their children already have millions

This post has been edited by boyboycute: Nov 20 2023, 11:36 AM

We know from the numbers, our government debt is around RM 1 trillion.

We also know EPF held around 50% to 60% of their portfolio in bonds. There are a lot of types of fixed income instruments held in there but Gov bonds and MGS are by far , still the largest holding.

Most bonds are held until maturity. So, there is no question of duration risk there.

I don't think EPF will sell those bonds anyway. Most likely, it's the price taker rather than negotiater.

But what if we mark those bond holdings to market?

OPR has risen about 1%.

The long duration bond value would go down tremendously , in theory.
This is just a theoretical question because there wouldn't any liquidity at all, even if EPF wanna dispose their holdings.

This is where you must understand that money doesn't fall from the sky. Gaji doesn't fall from the sky. EPF withdrawal also doesn't fall from the sky.
Taxes, Gaji, Pencen, bonus, or EPF withdrawal (whatever the label) must come from someone else, who is more productive and prudent in his financial management. He probably work harder and practise delay gratification too.

Without someone maximizing the EPF contribution to RM100k per year, EPF would have dispose its assets ,most probably at huge discount, because no institutional fund will buy asset from EPF at higher prices and deprive their shareholders/investors.

Always remember that money doesn't fall from the sky. Some "free" stuff like education, health care and scholarship came from "affirmative policies" to take from the productive segments (milk cow) of the society to "transfer" to certain ethnic group.
Milk cow is running dry now & some are leaving the country for greener pastures. Talented people goes to where they're best treated.


This post has been edited by boyboycute: Dec 29 2023, 03:14 PM

That's why no one pays for news anymore.

Deep analysis is more valuable.

This post has been edited by boyboycute: Jan 4 2024, 09:13 AM

Risk free? Nothing is risk free. The return reflects the risk premium.

If it's safety that you're looking for, then your return will reflects it as well. Most retireee here is looking for higher EPF dividend to hedge the rise in cost of living. It's disappointing to get under 6% since gov bond are paying higher + stock All time high. Looks like EPF owed their members a good open explanation. Keeping quiet on it and hope it will go off will only spark more speculation

2% is correct if the basket consists of the wages of employees

If account 3 can give 4.5% return, not many will put in FD anymore

Are u sure all 3 accounts will receive similar dividend rate?

Unker value peace of mind more than anything else. Maybe you are still young and have too much hair to understand that

This post has been edited by boyboycute: May 13 2024, 12:22 PM

Unker bought a PJ house almost 30 years ago for RM40k. Already 30x...Young fella running the numbers will never understand inflation like old fella