Full EPF withdrawal age stays at 55, says Najib

Most Malaysians want to be able to withdraw their retirement savings at 55, not 60. – The Malaysian Insider file pic, April 23, 2015.

Prime Minister Datuk Seri Najib Razak today announced that the age for full withdrawal by members of the Employees Provident Fund will be retained at 55, after taking into consideration the views of the public.

Prime Minister Datuk Seri Najib Razak says Employees Provident Fund (EPF) members will be able to withdraw their savings at 55. – The Malaysian Insider pic by Nazir Sufari, April 23, 2015."This government always listens to the views of the rakyat. And it is clear that the vast majority of EPF members, while understanding the importance of retirement savings at the age of 60, want the right to use their retirement funds at the age of 55," he said in a special announcement made during his keynote address at Invest Malaysia 2015 in Kuala Lumpur this morning.

He said that in two days of the online consultation process that was recently set up, 50,000 Malaysians had taken part and given their views.

Most wanted to be able to withdraw their retirement funds at 55.

Najib gave Putrajaya’s assurance that EPF members would retain the right to withdraw their savings at the age of 55.

"The EPF will ensure that any new enhancement will only apply to new contributions if members decide to work beyond the age of 55.

"This strikes a fair balance between the rakyat's expectations to their hard-earned money at the age of 55 while protecting them if they retire at the age of 60," he said.

EPF chief executive officer Datuk Shahril Ridza Ridzuan recently said that they were considering changing the permissible age for members to withdraw their savings from the current 55 years to 60 years.

He said the deliberation was based on the fact that on average, people exhausted their retirement savings within 3-5 years after a full withdrawal from EPF.

"Roughly 70% of people who withdraw their retirement savings in full will essentially deplete the money within three to five years’ time.

"Malaysians now make the withdrawal first (at 55) before actually retiring (at 60), and we are looking at this issue for the right policy response," Shahril told a media briefing on April 10.

Najib in his keynote address today also announced, the EPF has embarked on an initiative to offer a Shariah compliant investment option for its members in 2017.

"This will create the largest shariah fund of its kind in the world, and will further strengthen Malaysia's position as a leading Islamic financial centre. As such, Malaysia is well placed to drive the sustainability agenda further," he said.

- TMI