Despite an increase in lifespan, Malaysian retirees are withdrawing 70% of their savings and spending that money in less than 30 days.
The Employees Provident Fund (EPF) said that many of its members ran out of their savings within three to five years after retiring and was concerned with cases of those exhausting their withdrawals too soon.
“More worrying are cases where retirees withdrew 70% of their savings and spent the money in less than 30 days,” said Kuala Lumpur EPF branch retirement advisory service officer Nornisah Mohd Yusof.
Speaking to national newswire Bernama, Nornisah advised EPF subscribers, especially those about to retire, to plan their expenditure and manage their finances well, so as not to be left in the lurch during their old age.
She said EPF subscribers would need to have Basic Savings, a certain amount based on their age in their Account 1 to enable them to have savings of at least RM228,000 when they reached the age of 55.
The amount is in tandem with the minimum pension in the public sector, which is RM950 a month for 20 years, from the age of 55 to 75.
She said as of last year, 65% of EPF subscribers aged 54 and below had savings of less than RM50,000.