Financial Planning - Financial Goals for 2009

Have you got your 2009 calendar ready on your table? If not yet, you still have about 3 more days to go to get your new calendar. My bf gave me a beautiful 2009 table calendar. I noticed that this year, me and my family didn't received as many free calendars as compare to few years back. Even, the company I work with also only provide calendars for selected corporate customers. Since the global economy is still sinking and not stable, I guess everyone is trying to practise the cost saving methods in every way of life.

As 2009 is approaching, it's time for us to sit down and plan for the new year, 2009. I know some of us might not favour this new year resolutions stuff, but think of it positively. The plan itself will create a pathway for your and will make your journey much easier and meaningful. Experts said it'll be more effective if you write down your goals, rather than keeping it to yourself in your head. Basically, writing it down make us hold accountable for the promises we made to ourselves and thus encourage us to work towards our goals. I am glad to know that posting in a blog is also considered as writing it down.

So, here are my financial goals for 2009:

1) Increase my annual income by at least 10%. (to be completed by Dec 2009)

2) Moving the $$$ from my emergency account to fixed deposit accounts. I don't want my emergency account to just sit in the saving account. Moving the $$$to the fixed deposit accounts not only benefit me but also to the banks and the society as they need the $$$. (to be completed by Jan 2009)

3) Invest in a new unit trust fund. This time, I want to invest in equity fund. (to be completed by June 2009)

4) Continue to top up my existing unit trust funds. (all year long)

5) Keeping a separate file for each of my unit trust funds. Currently all my unit trust funds details are in the same file. It's time to separate them. Separating them will make my fund monitoring easier. (to be done by Jan 2009)

6) Monitoring my Public Bank Gold Investment Account and top up at least once. (to be completed by 31 Dec 2009)

7) Monitoring my investment-link Pru-link assurance and see if there's a need to review the coverage and purchase a second insurance. (to be done by Sept 2008)

8) Terminating my unused credit cards, and concentrate on 1 credit card with another two as backup. I must ensure that the active and backup credit cards are without annual fee. (to be done by June 2009)

9) File and submit my income tax early. (to be done by 15 April 2008)

10) Continue with my 'fun saving' account. My fun saving accounts keep all my fun expenses. This includes fun expenses for my family and for myself. It'sgreat to be able to provide some fun $$$ throughout the financial planning journey. Life can't be serious all the time, right :p (all year long)

I hope to be able to complete the above financial goals in 2009. Perhaps from time to time, I will have new goals which I wish to add in. And I am thankful to GOD for me to be able to meet most of my 2008 financial goals. The financial goal which was not in my 2008 financial goals was starting a blog on financial planning. I am really glad for this additional goals which I started in Oct 2008. It's making my life richer :)

If you wish to set up your financial goals, make sure they are S.M.A.R.T (Specific, Measurable, Achievable, Realistic, Timebound).

Have a happy and fruitful 2009!

Maybank eFixed Deposit - Fixed Deposit Placement Made Easy - Part 2

It has been 30 days since my first Maybank eFixed Deposit placement. Today, I uplifted the eFixed Deposit and everything run smooth. It's really easy and convenient. Just make sure you register or update your mobile number for the PAC before you continue with your online transactions. It's important, I repeat, it's important. You can't continue your online transaction without the PAC. It's for security issue and never, never ever reveal your PAC to anyone. Delete it from your mobile right after you completed your online transaction.

Also, noticed that Maybank2u has updated its banking portal. I remember I read from online news about a week ago that Maybank is halfway launching its new banking portal. Well, the new portal is more organized and has a more 'cool' look. Just that for today's visit, I faced 2 problems:

1) I can't differentiate between "Classic M2U : Click here to login" and the normal login. I tested both, I can login. I don't see the differences.

2) I can't find the eFixed Deposit rate when I was at the eFixed Deposit placement and uplifting page. Anyway, I managed to find it after I logged out. It's located at "Home > Accounts & Banking > Fixed Deposits > eFixed Deposit ". You need to click the 'find out more' to see the rates. 

Perhaps I need more time to get familiar with the new portal.

Related post: Maybank eFixed Deposit - Fixed Deposit Placement Made Easy - Part 1

Merry Christmas!!!

Merry Christmas to everyone!

I watched from RT news that for this year Christmas, generally people spent less $$$ compared to the years before. Whether we like it or not, the global economy crisis has strong impact on everyone life. Let's pray that we all will overcome this global economy crisis sooner than what's has been planned. May there will be more peace on Earth.

For you and your loved ones - May you have a blessed, meaningful and warm Christmas. And Happy Holiday too :)

(Picture Source From: http://www.christmas-corner.com/)

Online Banking @ E-Banking - Security Alert On Microsoft Internet Explorer

Which Internet browser are you using? If you are currently using Internet Explorer by Microsoft, you might want to consider to read further. Recently a friend from London sent me an email with news regarding security alert on Microsoft Internet Explorer (IE). Two days after he sent me the security alert email, our MIS Department circulated the same news to all of our staffs. You can read the news here.

If you are currently using Internet Explorer (especially version 7), and you access to online banking, you might have to consider to use other Internet browsers until Microsoft fix the problem. You never know what the computer hackers might do to your computer and your bank accounts. Act NOW!

7 Factors You Should Consider Before Investing In Unit Trust

For novice investors who wish to invest in unit trust @ mutual fund, there are a few factors which you should consider or at least aware of before you purchase your first unit trust fund. Based on my experience, I listed down below, 7 important factors you should consider before purchasing your first unit trust fund:

1) Investment objectives

The question is why you want to invest? For most of us, we invest because we want to make more money. The answer is not specific enough. To be successful in unit trust investing, you need to identify the objectives of your investment. Some refer this as investment goals. Your objectives or goals can be to prepare your downpayment for your dream home, to prepare education funds for your kids, to fund for your retirement or simply want to increase your net worth. Once you've set up your investment goals, it's much easier to walk down the investment road. This will also help you to identify the right funds for your. Your investment objectives and the fund's investment objectives should match.

2) Risk profile

Are you a high risk taker? Or you prefer to play safe? Different investor has different risk level. Make sure you know your personal risk level and are comfortable with the risk level of the desired funds. You must also aware that high risk funds provide higher return compared to low risk funds and vice-versa.

3) Time horizon for your investment

This is your age. It is one of the most important factors in successful unit trust investing. The longer your time horizon, the more benefits unit trust can bring for you. Because the younger you are, the more time for compounded interest to do their magic work. Younger investors also willing to take higher risk compared to matured investors. In other words, time is money.

4) Your affordability

How much you can afford for your unit trust investment? I would advise you to try with a minimum amount of investment first. As the time goes by, monitor your investment and learn more on unit trust investing. When you are more comfortable, then you can top-up the investment or invest in different funds or even different unit trust companies.

5) Fees and charges involved

Unit trusts funds are managed by a group of professional fund managers. They help unit trust investors to find ways to make more money by monitoring different stock markets. That's why there are fees and charges involved in unit trust investment. For example, for my Public Mutual- Public Divided Select Fund, the service charges range between 5%-7% of Net Asset Value (NAV) per unit and the management fee is 1.5% per annum of the NAV. Depending on the type of funds, there might be additional fees and charges involved. Read the factsheet clearly before starting your investment.

6) Investment amount are extra cash

You must also remember that the $$$ you invested in unit trust are extra cash which you will not need in near future (1-5 years). This is because in most cases, you will only see the return of investment after certain period of time. If you think you will need the $$$ in near future, unit trust is not the right place for you $$$. You must ensure that you have got your emergency savings ready, before starting your investment. This is to prevent the situation where you invested RM10K in Jan'08, then in July'08 you realised you need the RM10K for the downpayment of your new home. Depending on market price, the investment value at July'08 might be lower than RM10K.

7) Get a reliable unit trust consultant

If you walk-in to any unit trust companies, normally they will assign you with a unit trust consultant. If you are not satisfied with the service provided, you are free to request for a different unit trust consultants. Make sure your unit trust consultants will be able to provide investment advice based on your needs and not their needs. Try to prevent to deal with unit trust consultants who merely look for the sales commission from your investment.

I hope my sharing above will benefits those who wish to start their unit trust investment. I am still learning and there are more things to be learned from unit trust investment which I will cover in my coming posts. Always remember - Investment involves RISK. Happy Investing & Happy Winter Festival!

How To Maximize Your Personal Income Tax Savings?

Few days ago, I received an email from a good friend, Jamie on Tax Reliefs for individual. She's in financial industry and occasionally she'll email me some financial articles, which I find very interesting. I am glad that she gave me the green light to share the content of the email in my Money Magnet.

Here are the 8 simple and practical last minutes action to maximize your 2008 tax savings:

1. RM1,000 for purchasing books, magazine, journal (except newspaper). If you don't read books then buy them as gift for others.

$$$Now I have a good reason to subscript to Personal Money magazine and buy more books on financial literacy. Oh! Also, can consider buying books for loved ones - refer to my previous post on Affordable, Meaningful and Healthy Christmas Gift Ideas.$$$

2. RM3,000 for computer purchase for every 3 years only.

$$$Great, PC with Internet is a MUST. Hope that Inland Revenue Board (IRB) will soon extend to provide relief for Internet Service Providers (ISPs) subscription fees.$$$

3. RM300 for purchase of sports and exercise equipment such as all types of racquets and balls, treadmill, exercise bike and airwalker.

$$$Not applicable to me at the moment coz my exercise is jogging and swimming. Perhaps can consider treadmill or airwalker in the future.$$$

4. RM6,000 for both EPF & life insurance.

$$$I just calculated mine. It's already over than RM6K. No, not because of my EPF, but because of my insurance ;p For those of you who has not purchase any life insurance plan yet, it's a right financial move especially if you're the breadwinner for your family.$$$

5. RM3,000 for education & medical insurance.

$$$Hmm... my medical insurance is linked with my life insurance. I will find out if I can transfer the medical insurance from item 4. Then, I can have more relief.$$$

6. RM5,000 for medical checkup (RM500 max) & medical expenses to treat serious illness/disease for you, your spouse or kids. Both combined, limits to RM5,000.

$$$Have you go for your medical checkup? If not yet, you better call up the wellness centre at your nearby medical practitioner. My advice is get a professional one. I've done mine, only in last month.$$$

7. RM5,000 for parents medical expenses includes (treatment, nursing & dental - subject to terms & condition).

$$$Next time, I must remember to get the receipt from my parents' medical practitioner.$$$

8. RM5,000 for personal education (there is a limitation on type of education tho). Go upgrade yourself. Take advantage by paying the fees by 2008.

$$$Maybe I save this one for 2009. It has been quite a long time since my last assignment.$$$

Jamie, thank you for sharing the tax saving ideas with us. It's now less than 2 weeks before 2009. Let's us maximize our tax saving for 2008. Anyway, if time is a constraint, we can always plan ahead for our tax savings in 2009.

P/S: $$$These are my personal comments.$$$

Money and Integrity

Today I am not happy because I found out that someone had copied one of my earlier posts without my permission and act as if it's his post. I never thought someone would copy my posts, at least not at such an early stage of my blogging experience. Anyway, I already take appropriate action.

So, it leads me to think of the topic of Money & Integrity. For some people, their greedy mind will never be able to differentiate what's right and what's wrong. It's quite disappointing as this group of people are violating not only other's pure and original contents or properties but also violating the most wonderful creation of God, our minds, the living human minds...

I am against those who're not professional in his field, especially those who are getting profits from others efforts. I always believe that integrity plays an important role in our life journey. I listed the reasons below why I believe integrity is a big part of your wealth accumulation:

1) Easy come, easy go

Those $$$ which you accumulate easily will also go away easily. It's the nature rules - easy come, easy go. In explanation, it's normal that we don't really appreciate stuff which we can get easily.

2) Honestly leads to long term success

Perhaps those who're really lucky can get some quick $$$ by selling away their honestly and integrity. But how long would it last? How long they can expect to receive their return? In long run, honestly will always win. Even in movies, the rights will always overcome the wrongs.

3) Lose you integrity, Lose your faith - Lose your life

It's easy to be tempted by the dark world. But in real life, once you're 'black' @ 'dirty' it's difficult to be 'pure&white' @ 'clean' again. It's hard to maintain or accumulate more wealth with a 'black' @ 'dirty' background.

In conclusion, think twice before you sell off your integrity for quick $$$. It's definitely not worth it!

Unit Trust Investment - 5 Reasons Why I Invest in Unit Trust

I you read my earlier post on 'My First Unit Trust Investment - Public Dividend Select Fund', I did mentioned that before I decided to place my first unit trust investment, I done some online research on unit trust and mutual fund investment. I would be happy to share some of the findings, which later become the reasons why I invested in unit trust.

Here are the 5 reasons why I invested in unit trust:

1) Moderate Risk

I am not a high risk taker. I consider unit trust investment provides me with the right risk level, which is moderate risk. This is in compare to fixed deposit which is very low risk and share trading which is very high risk.

2) Diversification of my investment portfolio

If you read investment books or articles, I realised one of the thing which always mentioned by the authors or financial planning advisor is 'never put all your eggs in one basket'. So, unit trust is another basket for my eggs.

3) Higher return of investment

Over the long run (between 3-10 years, depending on fund performance), unit trust provides much higher return compare to fixed deposit.

4) Affordable initial investment

For most unit trust funds in Malaysia, the initial investment is RM1K, which is affordable for wage earner like me. Most additional investment is minimum RM100 per transaction. I would consider this as an easy and affordable learning step for those who wish to try on unit trust investment.

5) Convenient investment method

For initial investment, you just need to fill in the form and prepare the amount (cash or cheque) you wish to invest. You may pass it to your unit trust consultant or go to the respective unit trust offices to proceed with the investment. Within about 2 weeks time, they'll send you the details of your unit trust investment details. For additional investment, you may repeat the procedure above or arrange for a Standing Instruction (SI) with your banks to transfer a certain amount from your banks account to your unit trust account on monthly basis.

The above 5 reasons is convincing enough for me to explore further on unit trust investment. Since my first unit trust investment, I had also invested in other unit trust funds.

Feel free to share you unit trust investment reason with me.

*Always remember: investment involves RISK*

Holiday Spending List - Christmas 2008 Part II - Affordable, Meaningful and Healthy Gift Ideas

Among my early childhood memories of Christmas is Santa Claus with his huge red big bag filled with all wonderful Christmas gift. Another memory is beautiful Christmas stockings filled with Christmas gift and candy sticks hung over the fireplace. Yes, Christmas is the time filled with joy and gift exchange between friends and family members. Without Christmas gift, it doesn't really feel like Christmas. But sometimes, it can be a headache to get the right gift for the the right recipient. And most of the time, the gift can burn a hole in your purse @ wallet.

Thus, I come up with 25 affordable, meaningful and healthy gift ideas . To make your reading easier, I classify the list into 2 groups; personal gift ideas and general gift ideas:

Personal Gift Ideas (for loved ones-parents/spouse/ boyfriend/ girlfriend/family members)

1) Hand made Christmas card (beautify with your creativity - add beads/colourful papers)
2) Hand made cookies/cakes (you can show off your bakery skills!)
3) A silver necklace with a silver cross pendant (any girl will love this simple yet meaningful gift)
4) A pair of sport shoes (this is a healthy gift idea)
5) A bottle of perfume (this is a bit personal, make sure it's for someone very close and it's their favourites fragrance)
6) A hand watch (add personal touch with embroidery of recipient's name on the watchstrap)
7) An electronic shaver for men (for men who need to shave every morning, they'll love this gift)8) A make-up set for women (any women will love this gift)
9) A set of good quality colour pencils (any kids below 10 years old will love this)
10) Soft toys/teddy bears for young kids and teenagers
11) A set of barbie doll (a perfect gift for your daughter/young sister/niece or cousin)
12) A set of tool box for men (i think most men will love this. correct me if i am wrong ;p)
13) A bible (this is a perfect gift if you wish to share about Christianity with the recipient)
14) A big piggy bank for young kids (Yes, teach them to save young)
15) An MP3 player (suitable for music lovers)
16) Health tonic (more suitable for female recipient. Suggested Yomeishu/Benedict Dom)
17) Chicken/Duck/Fish essence for parents/grandparents
18) A lovely handbag for a lady friend
19) $$$ nicely fold in a cute gift box :) (I know everyone secretly wish for this :p)

General Gift Ideas (for everyone - friends/family/colleagues)
20) A box of chocolate , the evergreen gift ideas
21) Cash voucher from local shopping complex (this is for everyone. Suggested Parkson cash voucher. Receiver can purchase their desired gift)
22) An Inspirational books or Cash voucher from bookstore (suggested Popular Bookstore cash voucher)
23) A pen drive or a flash drive (this is a good idea for students and working adult too)
24) A purse/wallet (add surprise by slipping in a few pieces of $$$ in the new purse/wallet)
25) A good quality red wine or champagne (best shared during family/friends gathering)

I hope the gift ideas above will help or at least can give you some ideas in getting the right and affordable gift for your loved ones. May you find the right Christmas gift for the right recipient and may the gifts your received are in your Christmas wish list :P

P/S: Feel free to add in more... Just remember - must be affordable, meaningful and healthy!

*Thank you to my 8 years old niece, fung who contributed the gift ideas for kids *

My First Unit Trust Investment: Public Mutual - Public Dividend Select Fund

It was end of April 2005. A close friend of my brother called me up and said that she has 'something' to offer to me. I knew she's someone I can trust. So, we meet up during the following weekend to see what offer she has for me. It's a unit trust @ mutual fund initial offer by Public Mutual, Public Dividend Select Fund (PDSF). She told me the return from unit trust investment is much better compared to Fixed Deposit. I knew the existence of unit trust and had read somewhere about it, but it's still a very blur topic for me. I asked her some questions, in which she did answer me but I was still not clear about unit trust. I told her I need to do some research before I decided whether I want to invest or not. During the weekend, I spent some time doing research on Public Mutual and unit trust or mutual fund. For most of the questions, I found the answers through my online research at Public Mutual website, Securities Commission of Malaysia website and some blogs & forums where they discussed on unit trust investment.

The following Monday, I called the friend and purchased my first unit trust from her, Public Dividend Select Fund (PDSF). I am the 'play safe' and not the high risk type, so I only invested the minimum initial investment which is RM1K. It was PDSF initial offer period, so there's free 1% additional units. The unit price is RM0.25. That means, I have a total of 4040 units. The calculations as below:

Initial investment = RM1000

Price per unit = RM0.25

Total Unit (RM1000/RM0.25) = 4000 units

1% free unit during initial offer period (1% x 4000 units) = 40 units

So, the total unit for my first investment is 4040 units.

Throughout the past 3.5 years, I did monitor the performance of PDSF from Public Mutual website. The peak performance was somewhere in Dec 2007, where the price shoot to about RM0.32/unit. So far, I had received 4 times dividends (May'06, May'07, Dec'07 & May'08). As at 31 May 2008, my total unit for PDSF is 5333.05. That is an increment of 1293.05 units compare to my initial investment (4040 units). Due to global economy crisis, the current price had dropped to RM0.2094/unit (price as at 5 Dec 2008). If I wish to sell off my PDSF now, I will be receiving RM1,116.74 (calculations: 5333.05 units x RM0.2094). After 3.5 years, the return is RM116.74 for investment of RM1K. NO, I am not going to sell if of yet. The price will go up again, just give PDSF more time.

The performance chart below summarize part of the story above.

From PDSF, I had also do more research and readings on unit trust and invested in other unit trust investments. I am still learning. And it will be great if you can share your unit trust investment experience as well. Feel free to comment.

Holiday Spending List - Christmas 2008

Christmas is in the air. I smell Christmas everywhere... Christmas songs at the shopping malls, Christmas wreath on my neighbour's office door, Christmas promotion sales on local newspaper, even Christmas post by blogger Ching Ya :)

I am not sure with you, but for me, I have a strong urge to spend a lot during holiday seasons, especially Christmas and Chinese New Year. Perhaps the happy feeling is somehow connected to the spending feeling. But, somehow since the past 3 years, I learned to and managed to control these strong urge. It's not easy, but definitely can be done by anyone... yes, anyone including you.

To fight these strong urge to spend unnecessary during holiday season, you must have a holiday spending list a.k.a budgeting. I don't really like to use the word budgeting because it brings a negative feeling of controlling and squeezing your $$$. Negative feeling will deter our mind from continuing what we plan to do, which is planning for our spending.

Based on my own experience, I hope the spending tips below will help you to manage your holiday spending well and enjoyable:

1) Start your holiday spending list early

You should start planning your holiday spending list a few weeks before the holiday arrived. From my own experience, the nearer to the holiday, the stronger the urge you want to spend.

2) Affordable and meaningful@useful items/gifts

Your spending list must be affordable and enjoyable to you. Make sure the spending list comprises of the items or gifts which are necessary and important to you or your loved one (Christmas gifts). Do not waste your $$$ to purchase item which later just sit in the cupboard.

3) Review your spending list

This is related to tips no 1. The earlier you start your spending plan, the more time you have to review your spending list. Try to review you spending list at least once before you do the actual shopping. This is the time you ask yourself whether you really need that new set of cookwares, or you really need 4 different pairs of new shoes... ;p

4) Stick to your spending list

The most important part is stick to your spending list. Else, you spending list is just another piece of plain white paper. If your spending list budgeted RM100 gift for a family member, do not give yourself excuses to spend RM200. Stick to your own spending list also mean you respect your own self.

Have you started your Christmas spending list? If not, it's time to get a pen and paper... and wishing you a joyous Christmas shopping :)

EPF @ KWSP Contributions Reduced to 8% - Part 4 - Download Your Form KWSP 17A(AHL)-KHAS Here

I have been trying to access the EPF website and try to download the KWSP Form 17A(AHL)-KHAS. It seems like almost 95% of my attempt were failed since 1 Dec 2008. Even late at night, the EPF website still very busy. And I understand how frustrating is it when you are not able to download the form from EPF website. So, I found Scribd (Thanks to Peter Chen), a wonderful file sharing options for me to share the KWSP 17A(AHL)-KHAS with you.

FORM KWSP 17A(AHL) KHAS - For Individual Employee

Publish at Scribd or explore others: Asia Government kwsp Retirement Planning

KWSP 17AA(AHL)KHAS - For A Group Of Employees

Publish at Scribd or explore others: Asia Government kwsp Retirement Planning

If you are an individual employee, mostly you will need to fill up the first form, Form KWSP 17A(AHL)-Khas. If your company decided to submit the details of a group of employee under the same form, then your Human Resources @ Admin Department will arrange for Form KWSP 17AA(AHL)-Khas. For KWSP 17A(AHL)-Khas (individual), employee just need to fill in Part B & C only. The rest, it's your Human Resources @ Admin Deparment or your employer's responsibility.

Hope this help!

EPF @ KWSP - Advantages and Disadvantages of 3% Cut

Are you in your EPF @ KWSP dilemma? Whether or not to opt to fill up the Form KWSP 17A(AHL) KHAS? Or just follow the new EPF @ KWSP regulation to reduce the employee contributions from 11% to 8% for the period of 2 years (Jan2009-Dec2010)? To see the options clearer, I listed out the advantages and disadvantages of the new reduced contributions to 8%.

The advantages of the 3% cut:

1) More disposable income
For those who can manage their finance well, more disposable income also mean they have more free money to plan for their own investment, be it unit trust investment or stock investment or protection/insurance plan. They can even transfer the extra $$$ to reduce their housing loan. Perhaps the money smart type can even get more return (compare to the average 6.98%) Instead of letting the $$$ to be managed by Mr EPF.

2) Help to boost private consumption and improve the global economy as a whole
If half of Malaysian wage-earners agree with the 3% cut, there will be about RM2.4bil annually circulating in the nation economy. This definitely will improve the overall health of our economy, and globally as a whole.

The disadvantages of the 3% cut:

1) More disposable income (again?)
For those who is ill disciplined on saving and budgeting, have more disposable income also mean you have more money in your pocket to buy those 'unnecessary but tempting' stuffs

2) More taxable income
The current tax-free limit on EPF contributions and insurance premiums is RM8K. Paying less EPF contributions will increase your taxable income. Meant, you will pay more to the Mr InlandRevenue

3) Less dividend paid
Well, this is simple mathematics. If you have less $$$ in the EPF account, your annual dividend will also be less.

4) Less retirement fund
This is the main reason why I would opt to maintain my EPF contributions at 11%. After all, this is the whole purpose of EPF right? - "Savings For Old Age". Even though 3% is not a significant amount, but in long run, taking into consideration of compounded interest (3% x 12 months x 2 years x (the number of retirement years)) the final amount could be enough to support your old age for a few months or years!

Bear in mind the main objective of EPF is to fund for your retirement. The choice is yours. If you are confident that you can manage your 3% better than Mr EPF, you may opt for the 8% employee contributions. If you are unsure, it's advisable to opt to maintain the 11% employee contributions.

Let's keep building our nest egg!

EPF @ KWSP - Annual Dividend Rate from 1983-2007

It's a hot topic since 6 Nov 2008. Everyone has his/her own views on the new regulations by EPF @ KWSP to reduce employee contributions from the current 11% to 8% for year 2009 till year 2010. Today, I am a bit curious on this coming EPF dividend rate for year 2008. I digged out my EPF statements and done some research on EPF website. I got the list of annual EPF dividend rate from year 1983-2007 as below:

The EPF dividend rate has been dropping since year 1988. The highest was when it's first introduced, in year 1983 with dividend rate of 8.50% (This is impressive. Almost similar to some good performing funds). The lowest dividend rate was in year 2002 with dividend rate 4.25% only (This is not good for a huge fund like EPF. But, at least still better compare to normal Fixed Deposit). From the list, I calculated the average dividend rate for the past 25 years is 6.98%. The average return is not bad. But, looking at the dividend for the past few years (especially after year 2000), the rate is not so encouraging. Hmm... I am wondering what's the dividend rate for this coming year - 2008. Let's hope it'll not be lower than 4.25%.