ALTHOUGH the government estimates that two million Employees Provident Fund (EPF) contributors can make monthly withdrawals from their Account 1 under the i-Sinar facility, financial planning expert Datuk Chua Tia Guan doubts all of them are desperate enough to have to do it.
He reminded these contributors that unless they have no choice, they should think thrice before laying their hands on their retirement savings.
He said based on government statistics, some 500,000 Malaysians have lost their jobs in the wake of the Covid-19 pandemic but now as many as two million EPF contributors who are either jobless, made to take unpaid leave or have lost their incomes, are entitled to make withdrawals from their Account 1.
He said contributors should see the facility as an option instead of a “must-do”.
“The (i-Sinar) facility will help the genuinely needy people. After all, if they can’t put food on the table, is there a future for them to think or worry about?
“The measure is meant to help those facing critical financial problems, such as not having money to even buy bread and butter – people really fighting for survival.
“I am not certain if there are two million people who are in such a predicament,” said Chua, who is the head of tax and financial consulting at Asia Business Centre Malaysia.
He told China Press in a report published yesterday that those facing financial issues should try to alleviate their problems via the loan repayment moratorium, withdrawals from their EPF Account 2 and the Employment Insurance Scheme benefits.
Chua advised contributors to withdraw from their Account 1 only when they are still unable to put food on the table after seeking the aforementioned recourse.
“Dipping into the EPF accounts will definitely affect life in retirement. What’s more, 32% of EPF contributors have less than RM5,000 in their Account 1.”
He also advised contributors who are not stock market savvy against withdrawing money from Account 1 to dabble in shares.
Source: The Sun Daily