Making your savings last after retirement
A STUDY commissioned by the EPF revealed the an alarming 70 per cent of contributors who withdrew all their savings at 55 exhausted their funds in one to 10 years. It was with the intention of ensuring that a contributor's retirement savings last longer than the EPF introduced the "Beyond Savings" initiative, which allows contributors to make flexible withdrawals, as opposed to a lump sum withdrawal
Q : What is Age 55 Withdrawal?
A : This enables you to withdrawal all your savings upon reaching your 55th birthday to provide financial support for your retirement years.
Q : How much can I withdraw?
A : As this is an Age 55 withdrawal, you are permitted to withdraw your entire EPF savings upon reaching that age.
Q : What are the new options available for Age 55 Withdrawal?
A : Upon reaching 55, you can now choose to withdraw your savings at any time, subject to a minimum withdrawal of RM2,000 every 30 days, or simultaneously exercise the option of withdrawing the balance from your accounts on a monthly basis. Of course, full lump sum withdrawal is still available should you still wish to withdraw all your savings.
Q : Are there any terms and conditions for the different modes of withdrawal?
A : For the monthly payment option, you can withdraw a minimum of RM250 monthly for at least 12 months, provided you have a minimum of RM3,000 in your account.
Q : If my EPF savings at 55 amount to RM100,000, what are the different ways I can withdraw the sum?
A : Besides making a full lump sum withdrawal, you can make partial or monthly withdrawals for which you can determine the overall total monthly payment for each month, number of months and the date the payment should take effect.
For instance, you can :
1. Make a partial withdrawal of RM50,000 and arrange to withdraw the remainder in amounts of RM500 monthly until savings are depleted; or
2. Withdraw the RM100,000 in five instalments within two years.
Q : How do I apply for this withdrawal?
A : You must first complete the KWSP9B(AHL) form and produce supporting documents, namely your public identification card/MyKad; your bank book or current account statements of an active account; and, your passport if you are a Malaysian residing overseas or an expatriate. You must submit your application six months before your birthday but payment will only be made after that date.
Q : How will payments be made?
A : The EPF will make payments directly into your personal bank account, according to the requested amount and number of months.
Sources : New Straits Times 14th June 2010
