@AznRicy

This has been taken from an old thread
which has been closed.


You gave your girlfriend excellent advice.

I have been telling my nephew, as well as those in the
Fixed Deposits forum, to do the same, but they can't
see very far and don't seem to realize how important our
EPF will be in old age.

Like your girlfriend, my nephew and those in the FD forum
listened to silly rumors from their friends :

" Government is cheating us. EPF very hard to take out. "

" My friend's father said very hard to take out EPF. They give
him all kinds of reasons. "

" Goverment is going bankrupt. They are using our EPF. "

" EPF is a ticking time bomb. "


Did your read the papers ? 70 PERCENT of those reaching 55
have less then $ 50,000 in their EPF.


EPF sounds alarm as most contributors have less than RM50,000 at 54.

http://www.themalaymailonline.com/malaysia...n-rm50000-at-54


There are over 4 million people hitting 55 and over in the
country now.

This means that at least 3 million have less than $ 50,000 in
their EPF.


Like this woman in my ex-office. She said her brother, single,
an engineer, is now in his 60s with just $ 15,000 in his EPF.


If you are married, your children may not bother about you in
old age. Like my aunt in her 80s - I had to use my EPF to take
her see the doctor at the hospital just two months ago.


EPF is FORCED savings.


EPF is the only GUARANTEED support you will have in old age.
Nobody else is going to take care of you.

If you put everything in an FD, chances are you'll spent most
of it away by 55.


I told my nephew, either :

Direct his employer to deduct extra, say $ 500, to his EPF
every month, and/or :

Pump in yourself, as and when you can, up to the $ 60,000
limit EPF allows per year.


EPF interest has remained relatively stable between 4.25 and
8.50 percent for the last 50 years.

Take an average of 6.375 percent.

If you have the money, put in $ 10,000 in the EPF for a start,
rather than any of the fixed deposits.

Then fill in the required EPF form to direct your employer to
deduct an extra $ 500 from your salary every month.

If you are 30 now, you'll have over $ 400,000 by 55.

http://www.calculator.net/interest-calcula...it=0&x=106&y=13



Compounding interest separates the rich from the broke. The great Albert Einstein once said “Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn't … pays it.”


http://www.thepennieswesaved.com/compound-...-eighth-wonder/


https://www.youtube.com/watch?v=LK7iadUBPWw/

https://m.youtube.com/watch?v=LK7iadUBPWw

This post has been edited by Tham: Feb 15 2018, 03:50 AM

👍

Difficult to withdraw or not, I can't say as I have no experience doing so. My father however has done so a couple of times to my knowledge and he has yet to complain about their procedures or processing lead time.

But as to whether EPF is worthy investment platform, unless you have the appetite for high risks, then EPF is a very sound platform. Have yet to see a FD offering higher return than EPF so far. But would be happily corrected if anyone knows otherwise!

As mentioned, those are just rumors.


They were probably referring to the 30 percent limit to Account 2
for medical fees and housing, before 55, or voluntary full withdrawal
only from this account between 50 and 55.

Once you reach 55, all you have to do is take your IC to the
EPF office, tell them you want to withdraw.

The counter will take your thumbprints, ask how much you
want to take out (mininum $ 2,000), print out the form
and that's it. All done within half an hour.

They will then credit your bank savings account two working
days later.

There is a 30-day period required between withdrawals (i.e.
you can withdraw only once a month), so make sure you are
taking out enough for your needs each time.




This post has been edited by Tham: Feb 15 2018, 04:32 PM

The main advantage of EPF over everything else is not that it is
just a sound investment platform - as emphasized - it is FORCED SAVINGS.


During the mid-80s, at least two people - one, a Prudential insurance man,
the other my ex-office manager - warned me not to ever touch my EPF,
not even to buy a house, if I can help it.

They emphasized that EPF is the ONLY surefire financial guardian who will
take care of you in old age.

The insurance man said the Government was actually making a mistake
by allowing members to take it out to buy property before 55.


I'm lucky I heeded their advice.

Otherwise I'll be begging on the five-foot ways for food now.


https://www.thestar.com.my/news/nation/2017...ert-to-11-rate/

EPF forms.

http://www.kwsp.gov.my/portal/en/web/kwsp/...o-contributions

This video illustrates how fast compound interest will increase your EPF over time,
if you were to channel funds in every month, or as and when you can, rather than
just putting a lump sum in a fixed deposit and leaving it there.


https://www.youtube.com/watch?v=AdWczjgaD5c



This post has been edited by Tham: Feb 16 2018, 04:35 PM

Our EPF is no different from all the rest of those "" INVESTMENTS FUNDS " in all other countries around the WORLD .

However the way to RATE is always to look at END OF YEAR DIVIDENDS !

Our EPF has a history of VERY IMPRESSIVE DIVINDENDS , hence returns which means their investment strategy is VERY GOOD !
But compared to the whole world , it appear the whole world is doing VERY POORLY !

So the EPF team is doing like BEST INVESTMENT MANAGER beating all the HIGHLY PAID INVESTMENTS throughout the world .

Why we wonder ------- these SUPERB INVESTMENT people are so UNKNOWN to the rest of the world , when they are CREATING HUGH WAVES giving STELLAR RETURNS ???

I think you are adult enough with thinking powers to know what is happening !

You still can't get the message.

The EPF is completely different.

I emphasized FORCED SAVINGS twice.

So did the people in the news link given.

Once you decide to put your money there, you can't take most of it out until you are 55.

All other private investment funds - unit trusts, etc - you can take out anytime you decide to.

And the EPF has the backing of the government.

They are the ones who decide the dividend rate each year.

The others don't. They're on their own.

And why do you bother how and why you get such good returns, as long as you get It, and are GUARANTEED to get it for life ?

The EPF has been around for the past 66 years - probably twice longer than you.

It won't run away.

As I told those in the Fixed Deposits forum - the advice has been given.

Ignore it at your own peril.




This post has been edited by Tham: Feb 16 2018, 09:40 AM

When you travel around the world , and get to know other CORRUPT countries & equally CORRUPT people whom manage these countries ---------- you will find EPF will also ------ be squirelled away by these CORRUPT officials . There is NOTHING that the ENTIRE population of depositors can do when these EPF with their so called SMART investments go seriously DOWNHILL or LOST due to SCANDALS !

The EPF has a guaranteed minimum annual dividend of 2.5 percent.

That's higher than most ordinary bank savings accounts these days.

Moreover, their dividend is compounded on a daily rest. I believe bank interest
is currently on monthly rest.

http://www.kwsp.gov.my/portal/en/web/kwsp/...-act/section-27

http://www.kwsp.gov.my/portal/en/member/faq/epf-investments

What if I opt for the 8% contribution and invest the rest elsewhere

During my earning years i deposited whatever additional cash i had into EPF. My plan was to retire with a handsome sum & live comfortably off the devidant.

Now at 69, live well,travel, even bought a new car a few years ago. EPF will stop devidants on my account when i reach 75,which is not too far away.

Will decide what to do when i come to that bridge!

This post has been edited by SKYjack: Feb 17 2018, 08:55 AM

Honestly, I’ve not heard about anyone actually encountering difficulties in withdrawal.

Even I used it to pay my ptptn and mortgage, fill in form, pass up, a week to approved. All done.

Even the rebate I receive for clearing ptptn was debited back to me efficiently and fast.

On top of that, by having epf, you’ll contribute have while the remain is from company, so 2 party involve.

Those without epf, company won’t pay exact 12% and maybe raise you say 5-8% which you’ll use it indiscriminately

And I think people who actually complain having problem withdrawing are people who have little money in epf, thus make up story to cover line

Self employed? What do you plan to invest in?

The employee's contribution has reverted to 11 percent in January
(luckily for you and the rest of the salaried population).

https://www.thestar.com.my/business/busines...t-from-january/


As mentioned, wherever you wish to invest your money,, that is your prerogative.

But if I were you, I would direct my employer to increase my contribution
to at least 17 percent immediately.

If you are earning $ 5,000, that would mean an additional $ 300
every month (assuming your pay remains constant).

If you are 30 now, you'll have over $ 200,000 more savings by 55,
based on an average dividend of 6.375 percent.

http://www.calculator.net/interest-calcula...tit=0&x=70&y=28


Obviously if your salary and/or the dividend increases over the years,
you would have more.



This post has been edited by Tham: Feb 17 2018, 07:13 PM

So you took the government's option, foresaw the long-term power of
compound interest, and self-contributed.

Very good for you !

That was very smart of you. I believe very few people in this country
have contributed on their own into EPF over its history.

And don't worry, your dividends will keep coming in until you are 100,

You can always drop by to see the PRO at the EPF at Jalan Gasing or
to confirm this. There are two advisory PRO rooms on the left as you
enter the main entrance. At least one is usually there until 4.30.


EPF PAYS DIVIDEND UP TO AGE 100

http://www.kwsp.gov.my/portal/documents/10..._19.07.2017.pdf



EPF CONTINUES DIVIDEND PAYMENTS BEYOND AGE 75

http://www.kwsp.gov.my/portal/documents/10...71_20062016.pdf



http://www.kwsp.gov.my/portal/en/news-list...DetailPage=true



http://www.thesundaily.my/news/1176988

http://english.astroawani.com/malaysia-new...dividends-58470

What if i contributed less, and invest in UT myself? isnt that more cost efficient?

Wow, that is one real success story of the EPF.

This means that early this year, they would have credited you
with a dividend of about $ 34,000.

http://www.calculator.net/interest-calcula...it=0&x=109&y=26

Almost $ 3,000 to use per month. You can live on the dividend
alone. That should be more than enough for three good meals
a day and some travelling/entertainment, since I believe you have your own house.

I've reworked the average dividend over the last 50 years
since 1968, based on this, and it comes to 6.19 percent.

http://www.kwsp.gov.my/portal/en/about-epf.../dividend-rates



Assuming you use up all of last year's dividend of $ 34,000
by the end of the year, you will still have the $480,000 at the
beginning of next year, at age 57.

6.19 percent daily rest is equivalent to 6.385 percent yearly rest.

http://www.calculator.net/interest-calcula...it=0&x=104&y=18


I'm no investment consultant. but this shows from next year onwards,
that you have about $ 2,700 to use a month for the next 40 years till 97.


http://www.calculator.net/retirement-calcu...wmuchtowithdraw


http://www.calculator.net/retirement-calcu...wlongtowithdraw




This post has been edited by Tham: Feb 17 2018, 09:23 PM

" A lot of people are making a lot of money in the gig economy for now,
but the thing is if they don't understand that they need to also save for
the future, then they will be in trouble when retirement comes. "


http://www.theedgemarkets.com/article/epf-...tirement-scheme

Every form of investment is bound to have a certain risk.

But that of the government is quite minimal compared to private ones.


Singapore's CPF contribution rates at 20 percent for the employee up
to age 55, previously 50 is far higher.

And their interest is dismal.

Those up to 55 earns just 5 % and only on their first $ 60,000, above that 4 %.

Those above 55 earns an extra 1 % on their first $ 30,000.

Malaysians are already quite lucky as it is.

https://www.gpayroll.com/blog/payroll/singa...ntribution.html

https://www.pwc.com/sg/en/company-administr...0-chgetocpf.pdf


Yes, the charity homes are in trouble.

https://www.themalaysianinsight.com/s/21577/

You mean you are self-employed and contributing voluntarily ?

If unit trusts are giving you better returns, then that is your choice.

As I have said, you can put your money in anywhere you feel is more profitable.

I'm no investment consultant, but investments are basically all about
risk/benefit.

You can get sudden windfalls with stocks - but look at the risk involved
if the market crashes.

Their CPF interest at just 5 % on the first $ 60,000 for most of the population
is high ?

How do you do your arithmetic ?

Don't factor in the exchange rate.

Say you have $ 600,000 in your CPF.

5 percent on $ 60,000 is just $ 3,000.

4 percent on $ 540,000 = $ 21,600.

Total $ 24,600.


6.9 percent for a Malaysian with RM 600,000 is RM 41,400.

He has received almost RM 20,000 more than the Singaporean.


Look at the earlier poster with RM 480,000.

He just received RM 33,120 early this year.



As I have already said, and several of the others here have also experienced,
there are NO PROBLEMS taking it out so far.

I have withdrawn several times last year and once early this year.

Najib may not be perfect, but he endears himself to people and won't
touch your EPF.



This post has been edited by Tham: Feb 17 2018, 10:43 PM

Yes I did self contribution during the last 10 years of working life.

Actually I went overseas to work, so that I could afford to educate my children, as I am a non bumi, no handouts! 5 years on overseas, realised my EPF was too low to sustain a quality of life I needed when retired. Apart from compound interest there was no contribution. The moment my children finished Uni, I started self contribution and built up a tidy sum.

Was rather disapointed last years interest by EPF, that was very poor show. Glad to note this year will be above 6%. Glad to hear EPF has changed it policy on interest payment to age 100. Stopping interest payments at 75 was too early. PPL are living healthy lifes beyod 75! Is self contribution still limited to 60K/year? I can't understand the logic here!

Tq for the websites! Will be reading those to update myself.

This post has been edited by SKYjack: Feb 18 2018, 11:38 AM

That's the problem with posting in these local "Kopitiam"
forums and coming across young kids like you, who are not
only dumb, but extremely rude.

(That's why my friends don't post here. They say there's
just a bunch of kids here talking "c**k".

I have been very patient with you, answering your questions,
giving you advice in investing your money, and yet you have
the nerve to flame me ?

This reflects on your upbringing, obviously.

And either you have extremely poor eyesight, and/or you have
an extremely poor IQ.

Did you even bother to look at the earlier links, particularly this ?


https://www.pwc.com/sg/en/company-administr...0-chgetocpf.pdf


As I said, I've lost my patience with you. I started this thread with
the intention of alerting some of you to the importance of saving
as much as you can in EPF while you are young.

No more time for you. Like I said - it's your money. Use it
anyhow you like - even at the casinos in Genting. I don't care.


You'll find out the consequences one day when you are in your
60s like the woman's older brother in my ex-office, with nothing
left but $ 15,000 in his EPF.

The last I heard, he was in severe depression, renting a run-down
$ 200 room (she said it was rat-infested) in one of the shophouses
along the main road at 2 1/2 mile Cheras (a few doors from the
funeral parlour).

And he is a qualified engineer.

The limit to $ 60,000 a year is to prevent money laundering,
according to the advisory PRO in EPF.

Even then, that's not so bad.


If you have $ 300,000 now, it will take just five years to put it all in.


2016's interest of 5.7 % wasn't really too bad either.

If you look at its history, it was 4.25 % in 2002.

And when EPF first started in the 1950s, it was just the minimum
2.5 %, climbing slowly up to 5.8 % 20 years later in 1971.

http://www.kwsp.gov.my/portal/en/about-epf.../dividend-rates


Do you think you can qualify for the 1 Malaysia Retirement Savings
Scheme ?

If so, why not transfer your money there, so they can give you
an additional $ 250 each year ?


https://www.thestar.com.my/news/nation/2012...-54000-members/

http://www.kwsp.gov.my/portal/en/general/1...-savings-scheme




Talking about lifespan these days.

I usually go to this unisex salon at Mutiara Complex in Ipoh Road
to cut my hair.

The hairstylist looks like Andy Lau, so they called him Andy.

When I went there two weeks ago, the shampoo girl said that
Andy had passed away last December.

Heart attack, 43.


Before that, up to end of 2013, I cut my hair at Taman Tenaga in Cheras,
at a small half-shop unisex salon.

The hairstylist and owner, Alan, passed away in Sungei Buloh hospital
in January 2014.

I don't even know what happened to him - all he said when I phoned him
before that, was that he had some fluid in his lungs.

So I thought lung cancer, but he was looking perfectly healthy before that.

In his 40s as well, I don't know his exact age.


And this Indian lawyer, Raj, whom I met at the pub below my old office
in Sri Hartamas - a really goodhearted caring person who always
bought me a meal everytime he saw me there.

He passed away about earlier last year, just before I lost my job
in June. Heart attack, 46.

Who is really the retard here by accusing people who try to give you good advice
by using that retarded phrase "bullshitting" ?

Who the hell wants to do that , and what does anyone gain, by "bullshitting" you ?

Where are your damned dinosaur brains ?

And who was really "screaming at the top of their lungs" ?

Nobody is trying to convince you to buy of their products - rather do
something for your own good.

As mentioned many times, it's your money. Dump it anywhere you like.


The facts given by the other posters, like Adri Wing and Skyjack, are not
enough proof ?

Adri Wing saved far more than $ 480,000, if you take into account
the expenses he has used on his family over the years - likely close
to a million.

And he just had $ 38,000 credited by the government into his account
in January.

How many people in the country have that much in the EPF ?

Do you think you can achieve that ?

What more proof do you need ?

If you are not interested in the EPF, and you think the government is
going to swindle your money, then you are free to keep your distance from
it and place your money anywhere else you wish.

Seems some of the high-risk unit trusts are getting returns of over 20 percent.

I suggest you take part in those investment sections of the forum.

Did he spend his money for medical treatment until he has to withdraw all from his savings?

That's because of changing demography in the country. People live longer and healthier these days, life expectancy increases.

Someone has to pay for this extra projected lifespan, so if it's not yourself, who else is going to do it for you? So you have to work more till 60 years, and at the time of your demise at age 75, the money in EPF would have been exhausted.

well, maybe you are financially very savvy and can take risk in higher return investments.

For me, so conservative and stupid, I put my money with EPF lor. Tried property , lost money. Tried stock market, lost money... thank you for your sympathy.

This post has been edited by Chrono-Trigger: Feb 20 2018, 12:39 PM

@tham that @TheRealist guy is a just a nuisance only or just plain stupid.. well it is hard to talk to a political motive asshole reply anyway... there is a saying with this kind of people..

"Aku mampu berhujah dgn 10 orang berilmu tetapi aku pasti kalah dengan yang jahil..." latterly means that dont argue with stupids that all

several of people scare to save in EPF bcoz they will think gov will know their secret not paying tax .

No, I don't know what happened to him exactly.

His sister said he was not really working all the time, and
those time he was, was more as some librarian in a Chinese
library. He's a Taiwanese graduate.

Then he went into depression several years ago, and was
under heavy treatment with clinics, then UKM.

I think his sister helped to pay for the private clinic in Cheras,
that Leong Polyclinic at 2 1/2 mile Cheras, near his shophouse.

The last I heard, he was taking several really heavy drugs
from UKM.

Wow.

This year's dividend (on last year's savings), at 6.9 % daily rest
is equivalent to 7.143 % yearly rest.

This would mean that the dividend was based on a total of

38,138.90 x 100/7.143 = 533,933.92

This would mean you now have -

$ 533,933.92 + 38,138.90 = 572,072.82

You can also try the Private Retirement Scheme started by Najib in 2012.

If you are between 20 to 30, and you put in at least $ 1,000 by the end
of this year, the government will also put in $ 1,000 for you.

Note that this offer ends this year.

The funds are similar to unit trusts, maybe a little less risky.


http://mypf.my/investing/prs/

https://www.ppa.my/

Several of the banks are managing it.


https://www.cimbbank.com.my/en/personal/pro...ent-scheme.html

http://www.aia-prs.com.my/en/index.html



https://www.fundsupermart.com.my/main/resea...ober-2017--9012

Note they also charge fees.


https://www.ppa.my/prs-providers/fees-comparison/



This post has been edited by Tham: Feb 23 2018, 05:53 PM

I invest 12k in 2014, my dad epf account and now i got 15500. can withdraw anytime i want cos my dad already pass retirement age.

If by age 55 i have 1million in my account 1 i think good enough

Earning more than 4k per month from the average 5% of annual divident

But in 20 years time 4k in 2040 would only worth 2k in 2017 i guess.

Property price wud skyrocketed. Donno in future 1m of property can get what.

Account 2 could only be used to as a downpayment haha

Try best to buy a good long term house in your 30s. And self co tribute as much as you can to kwsp before 55 that is the only way

By 55 you dont need a new car i guess

Can you explain this a little? I would like to know if i can do the same with my mom's EPF account. She is pass retirement age but she is still working.

once the person pass retirement age, he can withdraw or deposite voluntarily into the epf account. The dividend will continue to run until certain age.

What will happen if the person passed away before EPF withdrawal? does it gets pass along to his/her immediate family member?

I believe the person has to state a beneficiary for their EPF.

You should go to the EPF office and appoint your
beneficiaries, and their respective shares.

They will fill in a form, and then give a copy to you.

You can then also view it in your online account.

If you do not appoint a beneficiary, I believe the EPF will leave it to the court
administrators to decide on your nearest next-of-kins and their shares.

If you and your dad do not really need the money now,
I suggest you leave it in the EPF as long as you can.

After 15 years, based on an average dividend of 6.19 %,
you will have almost $ 40,000.

Compound interest drives up your savings very fast.

http://www.calculator.net/interest-calcula...it=0&x=113&y=16


If you could also put in an extra $6,000 every year,
you will have $ 192,000 .

http://www.calculator.net/interest-calcula...tit=0&x=99&y=25

Maybank also has its own retirement plan. Contact them to check it out.

http://www.maybank2u.com.my/mbb_info/m2u/p...l/INS-Insurance

-


This post has been edited by Tham: Feb 23 2018, 06:13 PM

He doesn't understand the power of :

Forced Savings + Compound Interest.

And he also doesn't realize that time passes by fast,
particularly as you age.

Before you know it, ten, twenty, suddenly thirty years has
passed you by.

It didn't seem that long ago when I was 30.

An average lifetime is just about 25,000 - 30,000 days.

And ten years is only 3,650 days.

As they say, our days are numbered from the start.



He still can't believe that the government will allow him
to withdraw all his money at 55 - everything he contributed
up to the end of 54, that is.

Since they extended the retirement age to 60, all contributions
from 55 to 59 can be withdrawn only after 60. But that's for
your own good. Otherwise you will tend to use up everything
within ten years.



https://www.thestar.com.my/business/busines...for-retirement/


https://www.thestar.com.my/business/busines...tirement-years/


This was in 2010.

http://www.kwsp.gov.my/portal/en/news-list...primaryKey=1901

https://www.thestar.com.my/business/busines...for-retirement/


This means that if you want to contribute only the minimum 11 %
in EPF, you should save 19 % elsewhere.


If you salary is $ 5,000, your EPF deducted will be $ 550.

That means you should save at least :

$ 4,450 x 19 % = $ 845 a month.


I would suggest you put that in the PRS or another retirement
scheme like Maybank's.

Otherewise, some of the banks and insurance companies are also
selling annuity-based insurance plans.


If, however, you decide to put that in EPF, and you are 30 now,
you will have $ 600,000 by 55.


http://www.calculator.net/interest-calcula...it=0&x=117&y=15



This post has been edited by Tham: Feb 24 2018, 05:46 PM

thanks sifu.. but do you know is there any rules state that once the person reach certain age then no more dividend any more?

The interest in EPF is compounded by daily?

This post has been edited by prozdennis: Feb 23 2018, 11:44 PM

EPF dividends will continue to 100.


http://www.kwsp.gov.my/portal/documents/10..._19.07.2017.pdf

http://www.kwsp.gov.my/portal/documents/10...71_20062016.pdf

http://www.kwsp.gov.my/portal/en/news-list...DetailPage=true


Yes, EPF dividend is calculated on daily rest.

This year's dividend of 6.9 % is actually equal to 7.143 % annual rate.

http://www.calculator.net/interest-calcula...tit=0&x=92&y=17



This post has been edited by Tham: Feb 24 2018, 05:21 PM

Investment in EPF is safe. If EPF failed in future, Malaysia itself already gone case like Greece.

As long as new workers and contributors continue to grow and out number withdrawals, there will be enough money....but like all pension funds, the problem will come in future when the society matures, and there are less young people, and the current youths reaches retirement....there may not be enough money to pay out....

When that will come, if we look at other matured societies like Japan, even Singapore, we will see the population pyramid change from pyramid to fat man in the next 30 years....

Short of an economic disaster, or gross management negligence EPF should be safe for the next 30 years....

Correction, the advice given in the newspaper link was to save, ideally, 30 %
of gross income, before EPF deduction.

That means if you earn $ 5,000 a month, of which 11 % goes
to your EPF, you should save another -

19 % x 5,000 = $ 950

You can put this in the PRS or other retirement schemes as you wish.


If you put it in the EPF, assuming you are 30 now, you will
then have $ 680,000 by 55, based on the average dividend
of 6.19 %, which I had estimated earlier.


http://www.calculator.net/interest-calcula...it=0&x=117&y=10



Together with the 11 % deducted, and your employer's
contribution of 13 %, total 24 %, you will have an additional
$ 1,200 going into your account every month.

24 % x 5,000 = $ 1,200


This means a total of $ 1,200 + 950 = $ 2,150 a month.


By 55, you will have $ 1.5 million dollars. Safe and sound
for a good retirement.

http://www.calculator.net/interest-calcula...it=0&x=121&y=20


Even accounting for a bad case yearly inflation of 5 %, you will still have
the equivalent of $ 450,000 in today's buying power.

http://www.calculator.net/interest-calcula...it=0&x=120&y=24


And that does not even include your contributions and dividends accumulated
before 30, and the subsequent dividends compounded on them.



This post has been edited by Tham: Feb 24 2018, 06:03 PM

Even if it is managed properly, it can enter into trouble....once retirees outnumber new contributors.... because it means negative equity and shrinking fund....if caught in a recession, or in Japan's case, prolonged period of low growth, the liquidation of assets to fund the negative equity may be inadequate to cover excess withdrawals....and collapse of the fund becomes a real possibility....

At this point, EPF is quite conservatively managed...albeit needing to perform "national service" at times.... but it's a very sweet pot of honey, politicians always will be tempted to help themselves to the pot....

pro

i think i should use your advise.. each year deposite my money into my dad EPF account.. btw, the most accurate of timing to deposite the epf is when or after they declare the dividend right? So my gain from this investment can be calculated accurately

Why would u deposit money into your dad's EPF account??? Get your own!

Think he just wants the flexibility to withdraw at any time. I guess his father's probably >55.

Better make sure his dad name him alone as beneficiary then!

Haha. Yeah.


Back to the topic. I'd safe what I can keep aside for long-term, and invest the rest on my own.

A strategy could be to max out the tax deductions for epf and prs(total 8k), and invest the remainder on your own. You'd need good discipline and understanding of the market but you can get higher returns compared to epf. It's not for everyone, though.

From your experience, what kind of returns are you getting yearly overall,
from the PRS ?

Are the funds somewhat less riskier than those of the banks' usual unit trusts ?

Do you choose and mix the funds to invest, or do their managers do it for you ?

The highest risk "Growth" funds seem to be returning as high as 20 percent,
and the moderate ones around 10 percent.


https://www.fundsupermart.com.my/main/resea...ober-2017--9012





This post has been edited by Tham: Feb 25 2018, 07:44 PM

The 6.9 % dividend declared in January this year are on last year's savings,
from 1 January 2017 to 31 December 2017.

So what you save from 1 January 2018 this year would earn
dividends, on a daily basis, based on what they declare next January.

If you are investing a lump sum in just once or twice a year, obviously
you would earn more dividends/interest in you invest, say on 1 March,
where your money would be in there for 10 months x 30 days = 300 days,
rather than on 1 December, where you would earn dividends for only one
month or 30 days.



This post has been edited by Tham: Feb 26 2018, 07:32 PM

My own IRR is about 4.8% with PRS (edit: actually, it's around 12.5%). Long story behind it. Won't elaborate here.

For the performance of the funds, try checking at fundsupermart. Generate the table there. Best annualised performance over 5 years is CIMB-Principal PRS Plus Asia Pacific Ex Japan Equity - Class C with 14.8%. The rest are under 10%. 1 year returns are high for China funds due to the fact that China had a great fall in 2016 and bounced back the past year.

PRS funds are supposedly more conservative compared to some of the normal UT "growth" funds.

For PRS, I started with two CIMB funds and am now only focusing on the above said fund. More like giving some business to a friend since it's only 3k a year, but performance for this fund seems pretty good so far.

For my own UT, I go through FSM and have an IRR of about 15.6%. Pretty happy with that vs EPF or FD over the past few years.

I'm someone with a trader mentality. I tend to sell off when the markets feel toppish and buy in after it drops. However, I monitor the markets quite closely as most of my trading is done on the US markets.

This post has been edited by thesoothsayer: Feb 25 2018, 11:02 PM

You're confused between two types of pension system. Defined contribution vs defined benefits.

Defined benefits such as government pensions is unsustainable, as you're guaranteed to get a certain amount of money until you die. And even after that, your spouse would get it. This type of system requires more and more contributor to support it. It's good for the pensioners, but bad for the system provider aka government.

Defined contributions, such as EPF (Malaysia) and CPF (Singapore) is sustainable. Because you'd only get the money the you put in the pot, plus interests.

Go and read more about pension system. Uncle google can help you a lot.

I belong to a defined benefit super in Australia. It gives you a choice to decide upon retirement of a lump sum or a pension for life (and wife gets 2/3 of your pension after you die) or you can decide on a part lump sum/part pension. As you have correctly stated, this kind of retirement scheme (defined benefit scheme) is sending the govt broke as they guarantee the payout (and need to meet any shortfall) - this is why the govt has slowly been phasing it out since the 90s.

Your gf is right, don't need to put too much money in EPF. Because u will never know if your money in EPF is used to pay back the 2.6b.

I am well aware of the different models of pension schemes....I am referring specifically to the defined contribution version as in EPF....

Epf type can have 2 potential problems to face....

When the time comes where withdrawals exceed contributions, the fund starts shrinking....and liquidation of assets starts....you just need a perfect storm of prolonged recession, low asset prices and low returns to see the fund getting into trouble....

And it's a sweet pot of honey politicians love to dip their fingers in....EPF bought into fgv IPO....to their credit, they got out fast once they sense it going sour....but still lost lots of money....this is the aspect many fear....

This post has been edited by limeuu: Feb 26 2018, 11:30 AM

Thanks for the good advice and tips.

I've never tried the share market (never had the resources,
rather). I know hardly anything about unit trusts, really, and
my sister is selling them, I think.

My ex-office manager told me two days ago that you must
be really patient and need good holding power in unit trusts,
since your money takes years to grow, and must be prepared
to make losses, just like the share market.


I had to go look up what IRR was.

With such a low IRR of just 4.8 %, barely meeting the inflation
rate, isn't that extremely low ?

I might join the PRS and invest a small amount into that
CIMB-Principal PRS Plus Asia Pacific Ex Japan Equity - Class C
fund you mentioned, a bit later.

Wonder if they allow someone my age to join.




This post has been edited by Tham: Feb 26 2018, 07:44 PM

The edited number after that is the right one 12.5%. I re-checked the numbers after the original post.

However, choosing a UT to invest in is not an exact science. Many theories behind it. Can take a look at the fundsupermart thread in the finance section to learn more.

If you go for the equity/growth funds, they basically invest in shares or foreign funds that invest in shares. You're just allowing the fund managers to choose what shares to invest in.

I believe in timing the market a bit. Other investors probably think of me as a heretic. But I think everyone should get a strategy they're comfortable with and follow that. I'm still tuning my strategy.

If you look at the fundsupermart table, you'll notice that the annualised return of a lot of funds is below what EPF/Amanah saham can give you. I'd say that if you're not in a hurry, keep your bullets safe for now and buy in at the next crash.

Thanks again for the info.

Will keep that in mind.

Yes, unit trusts are still basically the share market, though less riskier, any losses being buffered by the pool of funds the trust invests in.

It's still all about speculation, manipulation and market forces.



This post has been edited by Tham: Mar 1 2018, 11:18 PM

It seems the EPF also provides you to invest under their
Members' Investment Scheme in these unit trusts.

http://www.kwsp.gov.my/portal/en/member/me...ment-withdrawal


For the CIMB-Principal PRS Plus Asia Pacific Ex-Japan Equity,
they invest 95 % in this CIMB-Principal Asia Pacific Dynamic Income Fund.

http://www.ppa.my/prs-providers/cimb/


So if you invest directly from your EPF to this fund, it is
almost the same.

http://www.kwsp.gov.my/portal/documents/10...sh_28022018.pdf


EPF does not charge any fees, but I am not sure if the fund's fees
may be higher than that investing thru the PRS.

Haven't tried the Members' Investment Scheme yet, but I have the forms ready.

IIRC, from what the FSM agent told me, you need to submit the form with the amount you want to purchase and the top up is less flexible. Not sure about the selling part. For this scheme, I'm only going in when there's a huge market crash. Otherwise, I doubt it can beat EPF dividends. Eg. If you go in now and the market crashes 60%, your NAV will drop almost as much. Will take years to recover your NAV.

Years !

The Net Asset Value = The price at which you purchased the units, minus all fees ?

That means unit trusts are extremely risky, basically the same as the stock market.

@TheSoothSayer


As I said, I know hardly anything about unit trusts, but
this CIMB Principal Asia Pacific Dynamic Income Fund
seems a real performer ?


http://www.cimb-principal.com.my/cimbFunds...ncome_Fund.aspx


If you key the three of them in the chart over 10 years, it way
outperforms both the Dynamic Growth and Ex-Japan funds, which
are already among the top performers.

https://www.fundsupermart.com.my/main/fundi...ter_switch.svdo

I think a lot of the UT for foreign markets basically buy into foreign funds. Like CIMB Greater China fund actually buys into Schroder International Selection Fund Greater China which in turn invests in stocks in the Greater China region.

I believe u refers to this thread.
U failed tagging 😳
https://forum.lowyat.net/index.php?showtopic=4352999&hl=

Now why did the government choose unit trusts as a tool to encourage
youngsters to save their money, if their savings can actually be wiped out
overnight as easily as the stock market ?

And how do they expect these young guys to have the
technical know-how like you to analyze and wade thru the
all the intricacies and unknowns ?

I wouldn't even know which fund to choose if you didn't
tell me about that Japan equity.

I think EPF does allow withdrawals every 3 months so that's sort of doing DCA, but someone investing really need to know the risks and what he's buying into.

Also, if you'd bought into a peak at 2007/8 like the fund below, would you have continued buying after seeing it plunge 30-40% like for the fund below to DCA? It's a big ask for inexperienced investors.

http://my.morningstar.com/ap/quicktake/NAV...ivetab=NAVChart

Saying that, if you buy in after a big crash and buy in every 3 months for the next 5-10 years, you should be better off than leaving the money alone in EPF.

It seems the dividends declared by unit trusts are meaningless -
they just lessen the NAV, and it's just the same as passing from
the right hand to the left ?

That means for unit trusts, you have sell it off sooner or later,
in order to make any gains ?

This would mean those guys in the PRS won't be able to save
anything from the annual returns - i.e. the dividends, unlike
those of EPF, and the only way for them to save throughout
their period they are in the PRS, is from the gains (if any)
made from buying and selling over the years.

How can this be chosen as a medium of saving, as I put
earlier, by the government ?

What if they make losses, and end up with a minus balance
at the end, which is quite possible, since most of these young
guys are inexperienced ?

This would mean that holding a unit trust like that Japan
Equity or the CIMB Dynamic fund as a long term investment
is meaningless, and won't accumulate your savings, like the
annual compound interest by the EPF.

By the way, what does DCA mean ?



This post has been edited by Tham: Mar 17 2018, 03:42 PM

I was at the Shah Alam EPF office on Thursday. The Jalan Gasing
branch has been closed until further notice.

So this young advisor, about 30, I was talking to, told me
that the Members Investment Scheme are meant for those
below 55.

So I can't go in.

Then he advised that unit trusts are too risky - even he
self-contributes to the EPF.

Question, how to make self contribution?

Searched online, but no credible or solid response for the query.

I think dividends for equity based unit trust are deducted from the NAV but for fixed income funds, they are accounted for separately and didn't affect the NAV. Of course, the NAV for those funds are probably pretty static.

Yup. It's more risky for sure. Your gains are mostly in capital gains. That said, so's Buffet's Berkshire Hathaway shares.

DCA is dollar cost averaging. Basically meaning averaging the price of the unit trust you buy over time.