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What Is The National Education Savings Scheme (SSPN) In Malaysia?

SSPN fund announced a dividend of 3.05% for year 2022.

 

Malaysia’s National Higher Education Fund (PTPTN) is known for providing education loans at a low interest rate to students studying at higher education institutions within the country. PTPTN also has a National Education Savings Scheme (SSPN), which helps Malaysians save for their higher education through dividend distribution.  

Last year,  PTPTN announced a dividend of 3.05% for SSPN savings for the year 2022, which has increased by 0.5% compared to a dividend of 3% for the year 2021. In addition, you also enjoy tax relief and other benefits like receiving a matching grant from the government. 

Read Also: How Much Does It Cost To Study Medicine In Malaysia? 

SSPN’s Savings Funds 

SSPN offers two Shariah-compliant savings products: Simpan SSPN Prime and Simpan SSPN Plus.  

The first product, Simpan SSPN Prime, was launched in 2004. The second product, Simpan SSPN Plus, was introduced in 2015 through collaborations with Hong Leong MSIG Takaful Bhd, Great Eastern Takaful Bhd, and Takaful Ikhlas Family Bhd. This later product includes takaful protection for savers. 

Saving With SSPN 

For Simpan SSPN Prime, there is no minimum amount that you need to save. You can contribute to your account through salary deduction by filling in the SSPN Prime Save Monthly Salary Deduction Authorization Form. You will then need to send the form to your employer to authorise salary deductions and a copy to PTPTN. 

On the other hand, Simpan SSPN Plus savers need to save a minimum of RM30 a month. Additionally, you will also need to make a minimum takaful contribution of RM10 a month. Takaful is a form of Shariah-compliant insurance to safeguard insurees against potential losses. 

You can choose any of the following six Simpan SSPN Plus packages:  

Packages  Monthly Savings (RM)  Takaful Contribution (RM)  Total (RM)  
Diamond  20  10  30 
Pomegranate  40  10  50 
Topas   90  10  100 
Emerald  180  20  200 
Sapphire  270  30  300 
Diamond  200  300  500 

Source: PTPTN 

Benefits Of Saving With SSPN 

SSPN offers various benefits to savers to encourage Malaysians to save for their higher education instead of relying on loans.  

The following are benefits for saving with Simpan SSPN Prime and Simpan SSPN Plus: 

Savings Products  Simpan SSPN Prime  Simpan SSPN Plus 
Income tax relief 
  • Enjoy up to RM8,000 tax relief per year based on the current year’s net savings. 
  • Enjoy up to RM8,000 tax relief per year based on the current year’s net savings. 
  • Enjoy additional tax assessment relief of up to RM7,000 per year based on the current year’s takaful contributions. 
Matching grant 
  • Get up to RM10,000 (incentive for entry to a higher education institute) per family. 
Nil 
Takaful protection 
  • Death/permanent disability benefit (accident) Ringgit to Ringgit. 
  • Death/permanent disability benefit (regular) Ringgit to Ringgit. 
  • Death benefit:
    i. Depositor – RM2,000
    ii. Beneficiary – RM500 
  • Death/permanent disability benefit (accident) up to RM1,200,000. 
  • Death/permanent disability benefit (ordinary) up to RM1,000,000. 
  • Charity of death:
    i. Depositors – up to RM25,000 
    ii. Spouse – up to 12,500
    iii. 5 children – up to RM5,000 per person. 
  • Partial permanent disability benefits up to RM200,000 
  • Benefits for up to 45 critical illnesses up to RM200,000 
  • Hospital admission allowance up to RM250 per day.
    You may check the specific takaful protection benefits for each Simpan SSPN Plus package here. 

Source: SSPN

Do note that you may need to fulfill certain requirements to enjoy the benefits mentioned above.

Depositors who are saving for their children through Simpan SSPN Prime are eligible for tax relief whereas depositors who save for themselves are not eligible for tax relief. 

Similarly, a matching grant of RM10,000 is only given to Simpan SSPN Prime depositors who are saving for their children and not to depositors who save for themselves. The grant is also only eligible for families with a basic monthly income of less than RM4,000 and beneficiary has not reached the age of 29 when application is made.  

In addition, the grant is given to beneficiaries who have enrolled in a Higher Education Institute and course that is recognised by the government.  

To enjoy free takaful protection, Simpan SSPN Prime savers also need to be aged between 16 to 65 years old and have at least RM1,000 in their account.  

Withdrawing Your SSPN Savings 

You can withdraw your Simpan SSPN Prime savings at any time you want. There are several ways to withdraw your savings: 

Meanwhile, for Simpan SSPN Plus savers, you can only make withdrawals 3 years after the account opening date. You can make up to RM1,000 withdrawal per day. 

In addition, your Simpan SSPN Plus account needs to have a balance of RM1,000 after withdrawal.  

Opening An SSPN Account 

If you’re interested in saving with SSPN, you will first need to open an SSPN account. You’re also required to have an SSPN account with a minimum deposit if you want to apply for the PTPTN education loan. 

You’re eligible to open an Simpan SSPN Prime account if you fulfil the following requirements: 

  • The depositor is at least 16 years old and not more than 65 years old. 
  • The depositor is a Malaysian citizen. 
  • The beneficiary is aged between 1 day and before reaching the age of 29 years old. 
  • Each depositor can only open 1 account for the same beneficiary. 
  • A beneficiary who already has an account can open another one for himself or for another Malaysian citizen. 
  • Multiple depositors can open accounts for the same beneficiary and there’s no limit to the number of accounts for the beneficiary. 

You can open the Simpan SSPN Prime account online through the myPTPTN app, PTPTN official portal, or at any PTPTN branch or authorised agents.  

Do note that you can only open up to 10 accounts online. There is no limit to the number of accounts opened at branches. 

Read Also: Guide To Investing In Malaysia’s Private Retirement Scheme (PRS)  

 

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