PRS works in the same way as unit trusts. But PRS has zero sales fees.
PRS is also divided into Account A and Account B like EPF.
But I believe investors cannot take out the money until retirement age, i.e. 60 years old except for Account B with a 8% tax penalty on the withdrawal amount. There are different types of PRS as well, low risk, medium risk and high risk.
The returns have been good. More than 10% per annum for the Principal PRS Plus Asia Pacific Ex Japan Equity - Class C which I have.
You get diversification across different countries for your stocks since this is an Asia Pacific unit trust. Lower risk than investing in an individual stock in Bursa.
Besides being an additional retirement pot, the PRS is also income tax deductible. You will be able to deduct up to RM3,000 from your taxable income, which will count towards your final tax payable. Earnings generated by the PRS funds will also be exempted from tax charges.
What more can we ask for?
P/S : Of course, PRS is not capital guaranteed. We cannot ask for the moon!
So, we also need to choose the type of PRS that we are going to invest in carefully.
Stashaway seems more liquid than PRS since we can withdraw any time.