Friday, November 7, 2008

EPF @ KWSP contributions reduced to 8% - Part 1

"EPF contributions reduced to 8%". This is among the stories on cover page of yesterday's local news. For those of you who has no idea what is EPF, it stands for Employee Provident Fund, a forced saving fund by Malaysian government for old age. All employer must contribute 12% and employee contribute 11%.
At first, I thought employee who wish to have more money to spend, can submit a request to adjust their contribution from the current 11% to 8%. When I checked the news on EPF website today, it's the other way round. With effective from 1 Jan 2008, all EPF member contribution will be reduced to 8% for a period of 2 years. For those who wish to maintain their contribution at the current 11%, they can fill in the Form KWSP 17A (AHL).

I dont agree with this. I still prefer the rate to maintain at 11% for all employees. It's crucially important for working adults to save for their retirement. It's really sad to be old and not able to support oneself financially.
I hope the government will reconsider before the enforcement on Jan next year.
P/S: You may wish to read part 2 and part 3 of this post.

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