KUCHING: Sarawak Business Federation (SBF) is urging its members to seriously consider saving in the EPF Voluntary Contribution scheme with the Employees Provident Fund (EPF) posting a stronger performance now.
According to SBF Deputy President and EPF Board Member Datuk Philip Ting, by law EPF is required to provide a provide a guaranteed dividend of at least 2.5 per cent a year.
However, he pointed out that EPF had historically and consistently exceeded its mandate by delivering significantly higher rates throughout the years.
“With EPF paying good dividends, it makes good sense for our members to consider saving in the Voluntary Contribution scheme.
“EPF announced its headline dividend of 6.1 per cent for its conventional fund and 5.65 per cent for the Syariah fund in early March. This latest dividend rate is the highest in the past two years,” he said in a statement on Tuesday (March 8).
“For this kind of yield we want our members to consider depositing spare money, as it makes a sound option for retirement. This is to ensure that they have enough savings in EPF to afford retirement as Covid-19 related withdrawals have massively impacted contributors’ savings,” he said.
He disclosed that the federation had expressed concern over the issue of inadequate savings for retirement as pandemic-related withdrawals under i-Sinar, i-Lestari and i-Citra resulted in critically-low levels of savings for those below 55.
Ting said it is estimated that almost half of EPF members aged 54 and above would have less than RM50,000 upon retirement, adding it is important that this issue is addressed urgently.
Under the EPF Voluntary Contribution scheme, a member must contribute at least RM5 a month or RM60 a year and contributions can be made at any time according to individual financial capability.
“Sarawakians working overseas, the self-employed, business owners, commission agents even pensioners may pay any amount up to RM60,000 a year. Those not mandated by law to contribute to EPF should also take advantage of this scheme.
“Meanwhile, EPF is exploring many more benefits for its members which will be announced soon such as insurance scheme, financial planning and consultation” he added.
