Tuesday, 22 November 2016

“Akaun Emas”- A second retirement “nest egg” unveiled

Effective 1 January 2017, a new account called Akaun Emas (Gold Account) will be launched by Employees Provident Fund (EPF) for members working beyond the age of 55 following a consultation held with stakeholders.

Results from Members’ Consultation showed that 91,047 members had opted for an option to retain the full withdrawal age of 55 and to lock in new contributions until the age of 60. Akaun Emas was introduced in tandem with the increase of compulsory retirement age announced by the government from age 55 to age 60. Moreover, response from Members’ Consultation would have also been considered for the creation of this new account.

A HSBC Global report revealed that 91% of Malaysians aged 45 and above who would like to retire in the next five years are not prepared to retire due to financial constraints. This survey represented views of 18,000 people from 17 countries whereby 1,105 were Malaysians.  This is a major concern for people approaching retirement and it is hoped that Akaun Emas will be considered as a blessing for them.

Dr Yeah Kim Leng, Economics professor in Sunway Business University, was happy with the new initiative by EPF and considered it helpful for those who continue working beyond 55 years old. EPF chief Datuk Shahril Ridza Ridzuan assured that the current age 55 withdrawal will still be maintained.

Akaun Emas is EPF’s way of encouraging members to save up more and for a longer period of time in view of our increasing life-spans and decreasing ways to self-support upon retirement. Until the age of 55, members’ money will go into Account 1 and 2 and upon reaching 55, the funds will be combined into Akaun 55. If a member decides to continue working beyond the age of 55, that’s where Akaun Emas plays its role. Members’ funds will be parked in Akaun Emas and upon reaching 60 years, remaining funds from Akaun 55 will be combined with Akaun Emas and members will again have only one account.

Moreover, the move to raise the dividend payment age limit to 100 from 75 is welcomed as this would motivate members to maintain their savings, especially as Malaysians’ lifespans grow longer.

In summary, it is hoped that Akaun Emas will help to ease the retirement woes of all EPF members and to create a happier retirement environment with more savings.

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