EPF Attracts Record RM13 Billion in Voluntary Contributions
Confidence in the System
The Employees’ Provident Fund (EPF) has attracted a record RM13 billion in voluntary contributions last year, a testament to the public’s confidence in the statutory body. According to an EPF official, this amount is a significant increase from previous years and demonstrates the public’s trust in the fund’s ability to provide returns.
Why Choose EPF?
So, why are Malaysians choosing to save with EPF instead of banks? According to the official, the main reason is the much higher and consistent dividend rates over the last couple of decades. This has led to over 1.6 million members opting to save their money with EPF, with 1.2 million members contributing to the fund and another 400,000 joining through the i-Saraan scheme, a voluntary contribution for self-employed persons and casual workers without fixed income.
i-Saraan Scheme
The i-Saraan scheme offers a special incentive of 20% up to a maximum of RM500 from the government for total voluntary contributions. This has been a popular option for many, with 400,000 members taking advantage of the scheme.
Flexibility and Security
EPF members have the flexibility to top up their accounts voluntarily, with an annual limit of RM100,000. The official notes that 70% of members do not touch their funds in the Flexible Account (Account 3), which allows them to withdraw any amount at any time. This suggests that many members are using EPF as a long-term savings option, rather than a short-term cash reserve.
Savings Habits of EPF Members
Interestingly, about three million members who have reached the age of 55 and are eligible to withdraw their entire savings are still choosing to keep their money with EPF. This is likely due to the better returns and security offered by the fund. The official notes, "These show that Malaysians are taking their EPF savings seriously: RM13 billion in a year is a great start, and awareness of the advantages of voluntarily saving with EPF is catching on."
EPF Statistics
EPF has more than 15 million members, with about 8.5 million active contributors. Despite the large number of members, the fund remains committed to providing a secure and profitable savings option for Malaysians.
Conclusion
The EPF’s success is a testament to the public’s trust in the system. With its attractive dividend rates and flexible contribution options, it is no wonder that Malaysians are choosing to save with EPF. As the official noted, "RM13 billion in a year is a great start, and awareness of the advantages of voluntarily saving with EPF is catching on."
Frequently Asked Questions
Q: What is the EPF?
A: The Employees’ Provident Fund (EPF) is a statutory body that provides a savings and retirement plan for Malaysian workers.
Q: Why are people choosing to save with EPF?
A: Many Malaysians are choosing to save with EPF due to the much higher and consistent dividend rates over the last couple of decades.
Q: What is the i-Saraan scheme?
A: The i-Saraan scheme is a voluntary contribution for self-employed persons and casual workers without fixed income, offering a special incentive of 20% up to a maximum of RM500 from the government.
Q: Can EPF members top up their accounts voluntarily?
A: Yes, EPF members can top up their accounts voluntarily, with an annual limit of RM100,000.