When you are 55 years old, you can't withdraw all your EPF savings! But it is paid monthly like a pension allowance. Are you okay?
An expert has suggested that the system of full withdrawal of EPF contributors' savings at the age of 55 be stopped for those who start contributing after 1 January 2026, and replaced with a monthly payment scheme starting from the age of 60 to 75.
The proposal was voiced by People's Financial Consultant, Shamsuddin Abdul Kadir, who stated that this move will make the EPF truly function as an old-age protector and not a short-term savings fund.
He explained that new contributors can be allowed to make withdrawals from Account 2 at the age of 50 to pay off a home loan, while Account 3 remains open for emergency needs, including for those with critical illnesses.
Shamsuddin said the monthly payment scheme could be implemented provided flexibility was maintained so that the current needs of contributors were not neglected, while stressing that the proposal was not intended to restrict contributors' rights but to ensure that the country's retirement fund remained strong.
He also referred to a World Bank report which stated that the EPF full withdrawal age of 55 years was now considered too low given that Malaysians' life expectancy was increasing and the country's retirement system needed to be adjusted according to demographics.
Previously, the age limit for full withdrawal of EPF savings for members was 55 or 60 years depending on the category, but this new proposal calls for a comprehensive structural change so that the country's retirement system is more sustainable in the long term.
