The Employees’ Provident Fund (EPF)

EPF Dividends 2018 – 6.15%

The Employees’ Provident Fund has a good track record of declaring above average returns to Malaysians. Also, have a look at their very simple vision and mission.


Helping members achieve a better future


Safeguard members’ savings and deliver excellent services

Quality Policy

The EPF is committed to help members achieve a better future through continuous improvement in safeguarding members’ savings and delivering excellent services. 

With the EPF, Malaysians essentially have in place a system of forced savings, investing and reinvesting for their retirement.

An independent governmental body whose goal is not motivated by fees but to earn the highest possible return for its members.

In general, Malaysians are happy with the 6.15% declaration of dividends by the board of our good old EPF.

And YES! 
EPF = KWSP. They’re one and the same.

We’re all familiar with EPF as our retirement fund. But what does EPF actually invest in?

dividend magic - retirement
‘How late do you expect to be working?’

Main Assets of EPF

As of 2018, equities made up about 41% of EPF’s total assets.

A further 50% is invested in fixed income instruments.

Let’s have a look at some of EPF’s largest equity holdings.

It’s a good idea to have EPF’s investments as a reference, apart from my Freedom Fund of course. ; )

What Will Become of Your EPF Savings?

With the recent 6.15% declaration in dividend, what do you plan to do with your savings in the fund?

I’ve created a simple poll in an attempt to gauge the mentality and financial decisions of everyone here.

No pressure. Also, there are no wrong answers.

What Will You Do With Your EPF?

View Results

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What I Do With My EPF

I personally am leaving my EPF untouched till I reach 55. And then I’ll withdraw a monthly amount to keep me alive, slowly drawing down on the capital.

Your EPF is essentially forcing you to save a portion of your income every month. And it helps you reinvest those 6% and above dividends every single year.

Even though I’ve mentioned there being no wrong answers to the poll above, I do believe Option 2 and 3 – where you’re essentially drawing down on your funds from your EPF savings is the least financially sound decision.

I see no reason for one to forego that 6% return in lieu of mutual funds or property. If you’ve got to take money from your retirement savings to purchase something, you definitely can’t afford it. In my opinion, of course.

Has anyone done this long term and made good money from Options 2 and 3?


You may have heard from uncles and aunties telling you to withdraw as much as you can during times of uncertainty.

Mutual fund agents may have enticed you to believe their RM100 million funds are superior to our national fund – worth over RM800 fucking billion dollars.

Property agents may have hinted that your purchase of that 3BR apartment is a better decision than leaving your money in the hands of a professional investing team.

I think all are a load of hokum and I’ll stick with EPF for the foreseeable future.

I think you should too. 
And this is a plea to all Malaysians, don’t squander away your retirement savings.

TL;DR – Withdrawal from EPF? Bad idea.

12 Replies to “The Employees’ Provident Fund (EPF)”

  1. Leaving money in (EPF) savings account indeed a fool thinker according to Warren Buffett rules of Value Investing system. I still prefer to follow WB theory to invest in productive assets like Equities and Properties based on 80% and 20% respectively

    EPF average compound interest yield is 6.0% pa whereas my equities gained average 10% to 20% pa and properties or REITs offered 25% above. 🕵️‍♀️

    1. Hi Alwin Yau Min Sin,

      Fool thinker eh.. Look, there aren’t any right or wrong ways to invest. Different people have different ways, to each his own.
      You prefer equities and properties, that’s perfectly fine. No need to call people fools. Btw Warren Buffett 80-20 is in equities and bonds, not properties. Just saying.

      Also, if you get 20% per annum… you’re the new Warren Buffett man. Congrats. 25%.. you’re even better than the man himself. Fuhhhh

      As always, it is great to hear everyone’s’ opinions. Hope to see more of you around bro.

  2. Although the best option is the first option, I believe that many Malaysians CANNOT get by without touching their EPF at least once in their life – to withdraw from Account 2 for housing loan. The second time it will most likely be touched is to reduce housing loan. Then there is the third – to finance further studies. And a fourth, for medical fees. These are probably the necessary withdrawals that will be hard to avoid.

    As for the third option, self-contribute additional monies, there is a maximum. Self contribution is only a maximum of RM 60,000 per year (

    Alternatively, you can contribute more than the statutory requirements if you are working ( But is there a maximum limit? The current is 11% employee. Can an employee ask for say 30% or more?

    If everyone can contribute as much as they want, it is the best fixed deposit by far! Your answers to these questions are welcome!

  3. I’m with you, Leigh. I’m more than happy to leave my EPF funds untouched until I’m 55. The 6% (on average) returns are hard to beat, and compound interest with zero fees/costs that typically come with unit trusts, property investments etc is a magical thing over time.

    I might even top it up with additional funds to make the most of this benefit.

    Question: Would you know if leaving our funds in EPF and withdrawing only the annual interest an option?

    1. Hey Michele,

      Heh I think based on the poll, the majority of Malaysians and readers here would leave it untouched.

      And yes, I think withdrawing only the interest is an option. I haven’t really looked into it though.

    2. Yes, this can be done. My parents both above 60 are doing this. Only withdrawing the interest from past year dividend credited in monthly basis.

  4. Hey,

    Take any high-med risk local equity from any of the famous fund houses to do a 10/15/20 years cumulative returns. It should give you the numbers I mentioned earlier or maybe more. Its a long term game without frequent switching and strong perseverance.

    Regarding the house DP from acc2 I will leave it to the individuals as I dont agree with your stand on the outright NO you shouldnt touch your epf money till your 55 view.

    It would be dumb to blow all your savings thinking you would not live till 55 but on the flip side is also silly to live so frugal in your prime years saving up for the old age when you cant do half the things you wanted anymore due to whatever.


    1. Hey Alvin,

      Heh as I always say, to each his own. And there aren’t any wrong answers =D
      Always appreciate your opinion and input bro! I’m sure many others are of like mind and would prefer to invest on their own more aggressively.

      Cheers bruv!

  5. Long term play for option 2 and 3, talking min 10-15 years duration to see an annualized returned of 10-15%. Option 2 is you need a roof above your head and for DP and reno or even education like masters makes sense to utilize your acc2. Definitely you are also investing in insurance with investment plan linked, stock market, ETFs, gold crypto etc. Its just a good mix without leaving everything in EPF untouched at all. Who knows if you dont even live till 55?;)

    1. hey Alvin,

      Are those numbers verfified? 10- 15% annualised?
      As I said, if one is taking money from your future retirement fund to buy a house, they can;t afford it.

      Also, if we’re talking about not living till 55.. then just spend all the money now. Don’t think thats a valid point 😉

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