EPF is one of the main retirement schemes in Malaysia, acting as a source of income for when you stop working. Workers in Malaysia make mandatory contributions to their EPF every month through salary deductions. Employers also contribute a percentage of the salary to the employees’ EPF.
The savings are managed and invested by EPF, who provides guaranteed dividends to its contributors. In 2023, EPF delivered an annual dividend of 5.5% for conventional savings.
However, there has been concern about the dwindling savings of EPF members, especially after several special withdrawals were allowed during the pandemic. This raised the question if Malaysians will have sufficient retirement savings.
Every year, EPF publishes data to give an overview of its activities and accomplishments of the year, including the savings amounts of its members. It can be beneficial to know where you stand in terms of your EPF savings compared to your peers.
Read Also: Guide To EPF’s Voluntary Self-Contribution For Growing Your Retirement Savings
EPF Savings By Age Group
According to EPF, the total contributions collected in 2023 were RM97.56 billion, which was an increase of 15% from RM84.78 billion in 2022. EPF recorded 16 million members in 2023 out of which 8 million are active members, meaning they have contributed at least once in the last 12 months.
Another notable observation is that EPF members had an average savings of RM67,686 in 2023. As expected, people tend to earn higher income as they become older and will accumulate higher EPF savings.
We look at the average savings of EPF members according to age groups. As expected, members nearing retirement between the ages of 50 and 54 had the highest average savings of RM137,903. Of course, EPF members can start withdrawing from the EPF from age 55.
However, this figure is not sufficient for Malaysians to retire with basic necessities. According to EPF, Malaysians should aim to have basic savings of at least RM240,000 in their EPF by the time they turn 55. This will give them a monthly retirement income of RM1,000 for a period of 20 years after they stop working.
| Age Group | Average Savings |
| Below 25 | RM5,674 |
| 25 – 29 | RM16,505 |
| 30 – 34 | RM35,390 |
| 35 – 39 | RM61,606 |
| 40 – 44 | RM89,226 |
| 45 – 49 | RM121,287 |
| 50 – 54 | RM137,903 |
| 55 – 59 | RM107,922 |
| 60 – 64 | RM118,779 |
| 65 and above | RM74,157 |
| Total | RM67,686 |
Source: EPF
EPF Savings By Household Income Level
We can also take a look at the EPF savings balance of members in different household settings. In Malaysia, there are three categories of household incomes, which are the Bottom 40 (B40), Middle 40 (M40) and Top 20 (T20).
Households in the T20 category has the highest income followed by households in M40 and B40. As T20 households earned the highest income, naturally they recorded the highest average savings of RM278,941.
Meanwhile, B40 households had the lowest average savings at RM1,713, which was significantly lower than the other household categories.
The data also indicated that only T20 households had average EPF savings that were sufficient for retiring with basic necessities.
| Household Income Level | Average Savings |
| B40 | RM1,713 |
| M40 | RM28,032 |
| T20 | RM278,941 |
Source: EPF
EPF Savings By Race Group
EPF also provided data on the savings balance of members according to race groups. As seen in the table below, members of the Chinese race had the highest average EPF savings of RM140,285 followed by members of the Indian race at RM67,602.
| Race Group | Average Savings |
| Malay | RM40,827 |
| Other Bumiputera | RM24,110 |
| Chinese | RM140,285 |
| Indian | RM67,602 |
| Other races | RM21,795 |
Source: EPF
Do Malaysians Have Enough To Retire?
EPF’s data indicated that Malaysians’ average retirement savings were off from the basic savings amount of RM240,000, recommended by EPF.
The government has identified the issue of depleting EPF savings and introduced several initiatives. For instance, EPF has increased the cap for voluntary contribution to RM100,000 a year. Members can contribute to their EPF directly via the KWSP i-Akaun app in any amount they wish to.
The government also encourages gig workers to voluntarily contribute to their EPF through the i-Saraan scheme. Contributors will be eligible to a 15% contribution from the government, with an annual cap of RM300.
Read Also: What Happens To Your EPF Savings If You Continue To Work After Retirement Age?
Follow Us On Telegram & Instagram!
Join our Malaysia Telegram channel (@dollarsandsensemy) and follow our Malaysia Instagram Page (@dnsmalaysia) as we bring you the latest finance content in Malaysia!
