SHAH ALAM, DEC 28: The average EPF member who reaches retirement age will spend all his savings in 3-5 years while the life expectancy of Malaysians has increased to 75 years old.
Kuala Lumpur EPF Retirement Advisory Service (RAS) Officer Nornisah Mohd Yusof said it is more worrying as there are cases of pensioners withdrawing 70% of their savings and spending all of it in less than 30 days, a situation that should not occur.
Nornisah advised the public, especially soon-to-be pensioners, to be smart in managing their finances and to plan their expenses carefully especially as they get older.
“For members who need clarification or advisory services, they can refer to our certified RAS officers at their nearest EPF branches.
“We provide advice and insights in helping members make the right decisions before withdrawing their EPF savings,” she told BERNAMA.
“RAS officers also provide guidance on retirement fund management for members to earn a monthly income, ensure long-term sustainability and also the ability to support themselves after retirement,” she said.
Nornisah explained that EPF contributors need to have Basic Savings, which is a certain amount of money in Account 1 and defined by age, to enable them to have at least RM228,000 upon reaching 55 years old, in order to support their basic needs after retirement.
This amount is based on the minimum pension in the public sector, which is RM950 a month, for twenty years, from age 55 to 75, and based on the average life expectancy of Malaysians which is 75 years old.
She said that as of 2015, 65% of EPF members below 54 years old have less than RM50,000 in savings.
