4th March 2025 - 2 min read
Allowing contributors too much flexibility to withdraw their Employees’ Provident Fund (EPF) savings before they reach retirement is essentially setting them up for financial hardship in their later years, Prime Minister Datuk Seri Anwar Ibrahim said. He likened excessive early withdrawals to ‘punishing’ individuals in old age, as it would leave them with inadequate savings when they are no longer working.
He stated that for decades, including during his previous tenure as Finance Minister, the principle upheld was to avoid excessive withdrawals, as EPF savings are meant for retirement.
“EPF has made it clear that the majority of contributors, especially among the Malays, have very small savings. So, opening up this (early withdrawal) option will cause problems when they retire,” he said during the Minister’s Question Time at the Dewan Rakyat sitting today.
He also explained that while certain exceptions and relaxations have been granted in the past, particularly for those facing hardship or illness, the government must strike a balance between addressing urgent, immediate needs and preventing a scenario where people find themselves in financial hardship later in life with no other means of support.
Anwar said this in response to Nurul Amin Hamid (PN-Padang Terap) on whether the government would consider introducing special EPF withdrawals for contributors in need, such as those who have lost their jobs, to help them cope with life’s challenges. While reiterating the government’s stance against broad-based withdrawals, Anwar said he believed EPF could still consider urgent cases, even if they did not conform to existing EPF regulations.
On Saturday, EPF announced a 6.3% dividend for both conventional and syariah accounts in 2024, its highest since 2017. The total payout for conventional savings stood at RM63.05 billion, while RM10.19 billion was allocated for syariah savings, bringing the total dividend distribution to RM73.24 billion.
(Source: Bernama)
Samuel writes about personal finance and financial news, focusing on how banking updates, policies, and promotions affect everyday money decisions. He enjoys making complicated financial topics easier to follow. Outside of writing, he spends his time watching TV shows and occasionally convincing himself he will only watch one episode.
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