Malaysians urged to save up RM1mil in EPF savings by 60: Sarawak EPF

PETALING JAYA: Building a millionaire’s fortune for retirement is within reach through strategic financial planning and early contributions to the Employees’ Provident Fund (EPF), says Sarawak EPF.

Utilising the power of compound interest and maintaining disciplined saving habits can help young contributors transform modest savings into significant wealth, ensuring a secure and comfortable retirement.

Sarawak EPF regional director

Aminuddin Abdul Aziz, highlighted that about 1,700 out of 850,000 contributors in Sarawak have already accumulated RM1 million in their EPF savings across various age groups.

Starting contributions early provides a greater chance of accumulating sufficient savings to last through retirement comfortably.

For instance, an individual earning RM3,000 per month starting at age 30, with an average annual return of 5% and a 3% salary increase, could amass over RM1.3 million by age 60.

“This is based on a contribution rate of 13 per cent by the employer and 11 per cent by the employee. But with the condition that no withdrawals are made from their Akaun Fleksibel or Akaun Sejahtera or Akaun Persaraan until the age of 60,” he told New Sarawak Tribune.

He emphasised that early EPF contributions prepare individuals better for the future.

Adequate savings can lead to a more comfortable retirement, free from financial concerns.

He also added that accumulating basic savings of RM240,000 by age 55 can ensure financial stability, allowing for a monthly income of RM1,000 over a 20-year retirement period.