PETALING JAYA: Should Employees’ Provident Fund (EPF) members receive their retirement savings in monthly payments or a lump sum?
For many Malaysians approaching the retirement age, they want to have a choice.
Process senior engineer Adam Abu Bakar, 50, said having several options would allow eligible members to make a decision on how they want their savings to be disbursed.
“It shouldn’t be limited to either monthly payments or a lump sum amount. Personally, I am fine with either but there must be clarity on how the monthly payouts are calculated,” he said.
He also urged for EPF to have financial advisors readily available to help people manage their retirement funds.
“When a large sum of money suddenly presents itself, people may not know how to save or grow it,” he said.
The 13th Malaysia Plan (13MP), which was tabled in the Dewan Rakyat last Thursday, stated that the government was considering introducing a monthly pension payout under EPF.
In response, EPF said any decision on this matter would go thorough engagement with key stakeholders and careful consideration of members’ long-term interests.
Events supervisor Karina Cheng, 54, favoured lump sum payments, saying it can help during emergencies.
“We’ve worked hard for the money and these are our savings.
“It helps to have cash on hand, as any emergencies beyond our working years can be difficult to manage financially,” she said.
Accountant K. Shanmugam, 56, said he preferred the current system over a pension scheme.
“I have my Akaun Emas which I got at 55. I hope they will not force me to resort to a monthly pension scheme. It will not be sustainable for me as I will need my savings for expenses such as my children’s wedding and so on,” he said.
“If I am able to fully withdraw my savings, then I can plan my finances better. Also, considering a person’s age, there may be health emergencies as well that may require huge amounts of funds.”
As such, he said he wanted the government to maintain the current system.
Akaun Emas refers to an EPF account for members who reach the age of 55. Any contribution from members aged 55 will be credited into this account and can only be withdrawn once the member turns 60.
A senior bank executive who wanted to be known only as Henry, 56, said the current mechanism allowed him to financially support his child’s tertiary education expenses.
“Without the lump sum option, it can be very challenging to manage these expenses out of pocket,” he said.
“However, I do understand why the monthly payouts can help, as some people may splurge or even worse, get cheated of their savings.”
