Navigate Retirement

7 min read    I     Date: 18 March 2024

Navigating Retirement in Malaysia: Building Financial Resilience in a Era of Change

 

The Employees Provident Fund (EPF) has declared a dividend of 5.5% for conventional savings and 5.4% for shariah savings for 2023, a slight improvement from 2022. Most Malaysians are positive towards the performance of EPF and its dividend payout, but we must focus on the importance of building a robust financial plan for retirement due to several reasons:

Ageing Population
Ageing population challenge in Malaysia

Malaysia, like many other countries, is experiencing a significant demographic shift towards an ageing population. It is said that proportion of elderly citizens are expected to soar to 40% by 2043.
(Source: The Edge Malaysia, 3 March 2024)

Rising Cost
Rising cost of living and expenses

The relentless rise in living expenses, including healthcare, housing, and inflation, poses a significant challenge to retirees. Also, with the recent increment of Sales and Service Tax (SST) from 6% to 8% for certain services, it adds additional financial pressure short and long-term.

Savings
Inadequate savings upon retirement

Despite the availability of retirement savings vehicles like EPF, many Malaysians still find themselves with inadequate savings upon retirement. According to statistics, 35% of EPF members aged 54 years, have less than RM10,000 in savings.
(Source: NST, 1 January 2024)

On the pathway to financial security

It is important to build financial resilience to achieve positive well-being during your retirement years. Here are a couple of diversification options you can consider:

  • Invest a portion of your EPF savings through approved EPF funds via i-Invest
  • Invest in low-risk investment options like money market funds
  • Focus on investing in income-generating assets
Flower Pot

Take charge of your retirement savings with Principal.

Explore investing a portion of your EPF savings with Principal via our online investment portal. Learn more:
https://www.principal.com.my/en/invest-online

To access i-Invest, please use the classic KWSP portal: 
https://secure.kwsp.gov.my/member/member/login

Disclaimer: You are advised to read and understand the relevant Prospectus, Information Memorandum and/or Disclosure Document including any supplemental thereof and the Product Highlight Sheet (if any) before Investing. Among others, you should consider the fees and charges involved. The registration of the relevant Prospectus, Information Memorandum and/or Disclosure Document including any supplemental thereof and the Product Highlight Sheet (if any) with the Securities Commission Malaysia (SC) does not amount to nor indicate that the SC recommends or endorses the funds. A copy of the relevant Prospectus, Information Memorandum and/or Disclosure Document including any supplemental thereof and the Product Highlight Sheet (if any) may be obtained at our offices, distributors or our website at www.principal.com.my. The issuance of any units to which the relevant Prospectus, Information Memorandum and/or Disclosure Document relates will only be made on receipt of an application referred to in and accompanying a copy of the relevant Prospectus, Information Memorandum and/or Disclosure Document. Please be advised that investment in the relevant unit trust funds, wholesale funds and/ or private retirement scheme carry risk. An outline of the various risk involved are described in the relevant Prospectus, Information Memorandum and/or Disclosure Document. As an investor you should make your own risk assessment and seek professional advice, where necessary. Securities Commission Malaysia does not review advertisements produced by Principal.