Achieving sufficient basic savings in the Employees’ Provident Fund (EPF) is important for contributors to retire without concerns about sustaining their livelihoods after the age of 55.
Recent findings revealed that out of 746,000 EPF members aged 55 and below in Penang, only 199,000, or 27%, have achieved basic savings of at least RM264,000 in their accounts. In contrast, the remaining 547,000 members, or 73%, have yet to reach this minimum target.
Sharing these insights was EPF’s northern region director Jeffary Mohamed Isa, who also said that it was important for an individual to achieve basic savings for a decent retirement without the need to opt for other financial support.
Various reports have suggested that the inability of the majority of EPF members below the age of 55 to achieve basic savings was due to withdrawals made from their EPF Account 2 for purposes like education or first home purchase.
On Sept 26, a special engagement session was held by the EPF northern chapter with media members at Ascott Gurney in George Town.
Held for the first time here, the session was aimed at strengthening the ties between EPF’s northern chapter and the media in Penang while educating the public about the initiatives and programmes carried out by EPF.
Jeffary elaborated on three key challenges faced by the EPF northern chapter: insufficient basic savings, a shift in employment trends towards the informal sector, and the low participation rate of Muslim EPF members in Simpanan Shariah.
He also highlighted that the team at EPF is focused on enhancing its presence among the public to inform them about programmes and initiatives, especially aimed at increasing the participation of members in the informal sector.
“We want to build a better retirement future for Malaysians and help EPF members achieve a comfortable retirement income.
“i-Saraan, an initiative that certainly still requires the attention of many, has only an 8% participation rate as of December last year among active EPF members in Penang.
“This translates to only 52,176 have registered for the programme, which is designed as a retirement saving scheme for those in the informal sector, specifically those self-employed individuals,” Jeffary added.
Story by Kevin Vimal
Pix courtesy of Mardhiah Yunos