Good news indeed if EPF 2021 dividend is really 6% or higher.

Good news indeed if EPF 2021 dividend is really 6% or higher.

The days when fixed deposits were firmly an investment for future

I come from a generation where the Fixed Deposit rates were good enough to be known as as investment savings. 5%, 5.5% or even 6% for example. Take a look at the chart below. Yeah, I think I start to know about fixed deposits in the 90s since that was the time when I was completed my secondary school… my university and even started working in July 1998 which was not so rosy because of the ASEAN Financial crisis in 1997.


Today, the fixed deposit rates are 1.8% or maybe 2% depending on how much we deposit and of course if we are taing a 12 month deposit, it may now be slightly above 2% as well. BNM is expected to adjust the rates upwards in H2 2022. (Read about the news here) Such low rates are not such good news especially for many who may not know about other investments beyond just the fixed deposits.

Article in The Edge’s back-of-the-envelope calculation shows that dividend from the EPF for year 2021 is set to beat the rate in 2020. In 2020, it was 5.2% for conventional and 4.9% for shariah. In fact there is that chance that the conventional dividend may reach its highest in three years, maybe even touching 6%.

The reason is because EPF’s performance for the first nine months of 2021 was RM47.67 billion and this is already more than the RM47.64 billion paid out to EPF members in 2020. Do read the full article here: Article in

What if it reached only 5.8% then?

Assuming EPF was not able to declare 6% but only 5.8%, what does this mean? Well, this meant that the dividend return is higher than the dividend returns from most of the companies which people have invested in. In fact, at 5.8%, it will be more than 3 times higher than the fixed deposit rate of 1.8%!

So, if it is 5.8%, I will personally be very happy. Remember, using Rule of 72, it will take around 12 years for our money to double if it’s 5.8% on average. However, if it’s 1.8% then it will take 40 years. It means that even after we have worked from the day we graduate until the day we retire, the money we have has NOT yet doubled! I am grateful. Thank you for working hard for me, EPF. Cheers.

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