New EPF Retirement Savings: Helping Employers Support Financial Well-Being for Employees

According to EPF's recent statistics, only 36% of members aged 55 have reached the current Basic Savings target of RM240,000.

This is far below the amount needed for a comfortable retirement, particularly given the rising cost of living.

As life expectancy increases—averaging around 75 years in Malaysia—retirees must stretch their savings for at least 20 years.

This underscores the importance of proper planning, which is where EPF’s new initiatives come into play.

The Employees Provident Fund (EPF) has introduced two key tools to help Malaysians navigate this journey.

The Belanjawanku 2024/2025 guide and the Retirement Income Adequacy (RIA) Framework aim to provide a clear roadmap for achieving retirement goals while managing current living expenses.

As employers, supporting your workforce in understanding these tools can significantly enhance employee well-being and productivity.

Here's what you need to know about these initiatives and how they can benefit your team.

Overview of the Updated Belanjawanku 2024/2025 Guide

The updated Belanjawanku 2024/2025 guide is here to make retirement planning more practical and accessible.

Designed by the EPF, this guide provides a detailed breakdown of essential monthly expenses for different household types in Malaysia.

It’s all about helping people gauge their financial needs and plan for a comfortable retirement.

One standout feature of the updated guide is the introduction of the Retirement Income Adequacy (RIA) Framework.

This new framework focuses on helping Malaysians calculate how much they’ll need in savings to sustain their lifestyle post-retirement.

By using realistic scenarios and easy-to-understand tools, the RIA Framework empowers individuals to set clearer financial goals and track their progress toward achieving them.

EPF’s Mission to Improve Retirement Readiness for Malaysians

At its core, the EPF’s mission is all about helping Malaysians prepare for a secure and comfortable retirement.

But, the reality is, many are falling short. According to recent EPF statistics, only 36% of members aged 55 have reached the current Basic Savings target of RM 240,000.

This is a long way from what’s needed to maintain a comfortable lifestyle in retirement, especially with the cost of living rising year by year.

That’s why EPF has introduced tools like Belanjawanku and the RIA Framework. These initiatives are designed to help people understand how much they truly need to save and how to get there.

The goal is to bridge the gap between what people have saved and what they actually need to live comfortably in their golden years.

By making retirement planning easier to understand, EPF aims to improve the financial preparedness of Malaysians and ensure they have enough savings to enjoy their retirement without worry.

Belanjawanku 2024/2025 Guide

The Belanjawanku 2024/2025 guide is all about helping Malaysians figure out the minimum monthly expenses they’ll need for a decent lifestyle.

It shows how much money you should plan to cover basic needs like food, rent, and transportation to get by comfortably.

One big improvement this year is that the guide now covers 12 major cities across Malaysia, so it’s more accurate and relevant no matter where you live.

Plus, the guide gets updated annually to keep up with changes in the cost of living, making sure the figures stay realistic and useful.

For example, a single retiree in Malaysia would need about RM2,690 per month just to cover basic expenses.

That’s the starting point for what you’d need to save to maintain a simple, comfortable life once you retire. It’s a helpful benchmark to guide your financial planning.

Retirement Income Adequacy (RIA) Framework

RIA Framework is launching in JAnuary 2026 to help EPF members set realistic savings goals for retirement.

It’s designed to give Malaysians a clearer picture of how much money they’ll need to save to enjoy a comfortable retirement, based on their lifestyle and needs.

The framework is split into three levels of savings:

1. Basic Savings and Income

This covers the essentials, enough to meet basic retirement needs. The target is RM 390,000 by 2028.

2. Adequate Savings and Income

Aiming for a comfortable retirement with a reasonable standard of living. The target here is RM 650,000.

3. Enhanced Savings and Income

This ensures a higher level of financial security and freedom during retirement. The target for this level is RM1.3 million.

New Withdrawal Guidelines

EPF’s new withdrawal guidelines are designed to make your retirement savings last longer.

Instead of taking out all your money at once, these guidelines offer a monthly withdrawal plan to cover living expenses through retirement.

This system helps retirees have a steady income while making sure their savings don’t run out too soon. It’s like getting a monthly paycheck even after you stop working.

Here’s how it works.

If someone has RM 650,000 saved (Adequate Savings), they can withdraw about RM2,708 per month in the first year of retirement.
Over time, this amount will increase, reaching about RM 7,389 per month by year 20 to keep up with rising costs.
For those with RM1.3 million saved (Enhanced Savings), monthly withdrawals start at RM5,417 and grow to RM14,779 by year 20.

Gradual Implementation of New Targets

EPF is rolling out higher savings targets step by step to help members prepare for a more secure retirement.

These gradual increases give Malaysians time to adjust their financial plans and work toward the new goals.

Here’s the timeline and what it means:

RM290,000 by January 2026: The first increase ensures that members aim for a more realistic amount to cover rising costs.
RM340,000 by January 2027: A further adjustment as living expenses continue to grow.
RM390,000 by January 2028: This final target aligns with the new Basic Savings benchmark, giving retirees better financial stability.

Flexibility for Higher Savings Members

For members with higher savings, EPF is offering more flexible options to make the most of their retirement funds.

These updates give individuals greater control while still focusing on long-term financial security.

If a member has more than RM1 million in savings, their withdrawals will follow the Enhanced Savings benchmark, allowing for higher monthly payouts that reflect their larger savings.

Additionally, for those whose savings exceed the Basic Savings target, up to 30% of the extra amount can be transferred to approved investment funds under the Member Investment Schemes (MIS).

This provides an opportunity to grow their money even further while enjoying flexibility in managing their retirement funds.

These options are ideal for members who have saved beyond the basic requirement and want to explore ways to maximize their financial potential in retirement.

Future Updates and Review

The RIA Framework isn’t set in stone. It’s designed to adapt as the cost of living changes.

Starting in 2029, EPF will review the framework every three years.

These reviews will ensure the savings benchmarks and withdrawal guidelines stay realistic and relevant to what Malaysians need for a comfortable retirement.

How will these updates work? The EPF will rely on Belanjawanku's guide, which provides detailed estimates of living expenses across Malaysia.

This ensures that savings targets reflect real-world costs, like housing, food, healthcare, and more.

For example, if the cost of living rises significantly in a particular city, the framework can be adjusted to account for those changes.

By regularly reviewing and updating the RIA framework, EPF is making sure that retirement planning stays on track, no matter how the economy evolves.

EPF’s Vision

EPF’s CEO Ahmad Zulqarnain Onn emphasized the importance of the Belanjawanku Guide and RIA Framework in helping Malaysians plan effectively for retirement.

He stated that these initiatives aim to provide an up-to-date understanding of monthly expenses and set new savings benchmarks, guiding Malaysians toward a fulfilling, secure retirement.

To assist members in planning their finances, EPF offers the Belanjawanku Guide, which can be downloaded for free from the EPF website.

Additionally, the Belanjawanku app is available for downloaded on the Apple App Store, Google Play Store, and Huawei App Gallery, providing easy access to budgeting tools and resources.

How Can Employers Play a Role?

As an employer, you can take proactive steps to integrate these retirement tools into your employee benefits program:

1. Educate Employees

Host workshops or provide informational materials on the Belanjawanku Guide and RIA Framework to empower your workforce with essential knowledge about retirement planning.

2. Offer Financial Planning Support

Collaborate with financial advisors to help employees assess their current savings and set realistic retirement goals based on the RIA Framework.

3. Encourage Regular Savings

Implement payroll deduction programs to make saving for retirement effortless for your employees.

4. Promote the Belanjawanku App

Encourage employees to download the free Belanjawanku app, available on all major platforms, to track expenses and plan effectively.

Why This Matters for Employers

Studies show that employees with financial security are more productive and less stressed, which directly benefits workplace morale and performance.

Moreover, aligning your company’s efforts with EPF’s initiatives demonstrates a commitment to employee welfare, enhancing your reputation as an employer of choice.

Additional Tips for Employees

Encourage employees to consider:

Diversified Investments: Beyond EPF, look into investment funds or private retirement schemes (PRS).
Emergency Funds: Build a savings buffer for unexpected expenses.
Regular Reviews: Periodically reassess savings goals to align with changing financial circumstances and living costs.

Encourage your team to explore the Belanjawanku 2024/2025 guide and start planning for a secure retirement with the new RIA Framework.

For more information, visit the EPF website to download the guide and learn about these initiatives.

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