EPF’s NEW POLICIES TO HELP CONTRIBUTORS AVOID OVERSPENDING
Minimum withdrawal of RM100 per month will help retirees with small savings
THE new policy announced by the Employees Provident Fund (EPF) allowing a minimum withdrawal of RM100 per month will give an option for contributors to avoid overspending.
This policy will benefit contributors with small EPF savings to better manage their finances in comparison with the RM250 minimum monthly withdrawal previously.
Public relations officer Rashdan Mustafa, 57, from Setapak, said as he was from the urban poor category, the minimum withdrawal amount would keep him grounded besides assisting him during emergencies.
“If I am desperate to use the money for my daily expenses, I can withdraw RM100 and leave the rest in my EPF account.
“It will teach me to spend money wisely.
“I do not have much in my EPF account, so this is a good way for me not to overspend.”
Many also breathed a sigh of relief with the announcement as it could help them cope with the high cost of living.
Sales marketing and project administrator Prem Nizah Mat Tazin, 51, said her plan was to use the money for emergencies, such as medical treatment.
“I have plans to manage my finances, as I also have other savings accounts and not dependent on my EPF savings.
“With the rising cost of living and healthcare bills, at least I can rely on this option.”
She said as a long-term plan, she would use the funds for her umrah (minor haj pilgrimage) trip to Mecca.
Another EPF contributor, Muhammad Nadzrein Johari, said he could use the money to pay for his children’s education as the cost increased each year.
“My children are young, and my plan is to use the money as a backup when they continue their tertiary education,” he said.
Federation of Malaysian Consumers Associations secretarygeneral Datuk Paul Selvaraj said financial knowledge must be given to those who were allowed to withdraw their EPF savings. He said retirees needed to know how they should manage their funds although they were now allowed to make partial withdrawals of any amount any time starting January.
“We need to acknowledge that no amount of money is going to be enough for retirement.
“Malaysians tend to spend their money for enjoyment, but do not have good financial management.
“We need to start teaching youths to manage their money properly,” he told the New Straits Times.
Malaysian Employers Federation executive director Datuk Shamsuddin Bardan said he feared even with such withdrawal flexibility, it would not change the current scenario where many retirees had little savings to get through the age of 75.