EPF members with less funds than poverty level

EPF members with less funds than poverty level

RM20 and 5 days till salary day

When I started working, there was one particular month which due to an unforeseen circumstance, I had just RM20 and it was 5 days till salary day. I was already a working adult and thus did not want to ask my parents for money. Those 5 days were tough because I needed to go to office. I needed to go out for lunch which I did not and gave excuses to my colleagues and drank just the Milo provided in the office. For breakfast, it was Gardenia bread and for dinner it was the same. It was a feeling I would not wish for anyone at all.

This is why I always try to tell everyone that personal finance is not about saving those few ringgit from meals. Personal finance minimum stage is to have one property because otherwise, how could one survive paying rental every month and yet having no income after retirement?

It seems that for some EPF contributors, their retirement will be a tough one.

Article in 71 pct of EPF contributors aged 55 and below do not have enough to rise above poverty level. Prime Minister Datuk Seri Anwar Ibrahim said this was due to the four special withdrawals approved during the Covid-19 pandemic.

Anwar, who is also Finance Minister, said the number of active members who had reached the basic savings target of RM240,000 by the age of 55 had dropped from 36 per cent in 2020 to 29 per cent at the end of last year.

“The EPF estimated that members are required to work between four and six extra years to rebuild the savings that were withdrawn during the pandemic,” he said in a parliamentary written reply to a question from Datuk Seri Amirudin Shari (Pakatan Harapan – Gombak). Do read here for the full article: Article in

What does PM meant with ‘poverty level’?

Malaysia’s new poverty line income is RM2,208, over 400k households considered poor (Source here) If we assume a household to be two persons, this household has RM1,104 per person for 30 days. If we deduct RM1,000 for rental out of this amount, then it’s RM1,208 per 2 person or 3 persons or 4 persons depending on how many people are in the household. We can see one major reason why poverty happens is because of property. This is true for all advanced countries and not just in Malaysia. Without property, it’s hard to escape poverty. The household would continue to pay rental for generations to come.

Think about this really hard and understand why I always write against personal finance writers who kept writing about saving here and there but continue to say property investment is not needed. I think they must be very rich because they did not have to worry about renting.


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