Roadmap to Retirement: Malaysia's Pension System

What you need to know about EPF in 7 questions

What is a Pension Scheme?

A pension is a tax efficient way for you to save money for your retirement. It plays a crucial role in providing financial security for retirees and safeguards their wellbeing during their golden years.

What is Malaysia’s Pension Scheme?

The Malaysian pension scheme is called the Employment Provident Fund (EPF) or Kumpulan Wang Simpanan Pekerja (KWSP). It is a compulsory fund; unlike the NHS pension scheme, employees cannot opt out of paying into their EPF.

The EPF is specifically designed for employees in the private sector. Malaysia also has the Public Services Pension Scheme (PSPS) for civil servants and the Armed Forces Fund Board (LTAT) for military personnel. However, this article focuses on the EPF.

What are the Rates?

Both the employee and employer makes regular contributions to the EPF. Contributions are based on a percentage of the employee’s salary.

The statutory minimum rate of contribution is

12% for employers

11% for employees

Although, the employer or employee can choose to contribute a higher rate.

When can I withdraw?

EPF members may withdraw 30% of their EPF savings when they reach 50 years old and may withdraw all of their EPF when they reach 55 years old. Withdrawals are tax free and ....

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Disclaimer

The information provided in this article is for general informational purposes only and should not be considered as pension advice. Pension planning and decisions can have significant financial implications, and the content presented here is not a substitute for personalized, professional advice tailored to your specific circumstances.

Readers are strongly encouraged to consult with qualified financial advisors, pension experts, or legal professionals before making any decisions related to their pension plans.

The authors and publishers of this article do not assume any responsibility or liability for any actions taken by readers based on the information presented herein. The content is provided for informational purposes only, and readers are urged to seek expert advice to make well-informed pension decisions.

Additionally, pension laws and regulations may vary by jurisdiction and change over time. Readers should verify the accuracy and currency of any information provided in this article by consulting relevant authorities or experts. Always conduct thorough research and consider your specific circumstances before making pension-related choices.