KUALA LUMPUR: The EPF proposal to withhold lump sum payment at 55 has stirred a storm of reaction among contributors, with many expressing frustration they would not be entitled to control the outflow of their money.
Lai Fatt Sian, 52, a faculty dean at Universiti Tunku Abdul Rahman, said the EPF might have made some bad investments and that could be why the fund did not have enough money to disburse.
He questioned the EPF’s right to monitor contributors' financial earnings and said he was upset that it wanted to play a parenting role.
An office administrator in a legal firm, Ching Tak Meng, 45, said: “It has no right to do that. It can manipulate other funds, but not my money.”
Businessman K. Pathmanathan, 54, said it was up to the contributors to do whatever they wanted with their money.
“This is our money. What we want to do with it is up to us,” he said.
Anna Makaddan, 36, a public relations assistant and a mother of two, said: “We need the lump sum money to support our children’s education. To take the money away is wrong, very wrong.”
A senior manager at a financial institute, J. Selvathesam, 53, said there was something terribly wrong if EPF did not allow the lump sum payment, and added that the EPF should look at giving incentives for education.
|Age 55 EPF withdrawal scheme |
Current Options1) Lump Sum payment2) Periodical payment of savings3) Annual dividend paid on savings
Proposed Changes1) Only 20-30% of EPF can be withdrawn and will be paid over a 15-20 year period2) Those reaching 50 are not allowed to take 1/3 out of their EPF savings
Lawyer A. Selvakumar, 53, said the proposal would restrict the contributors’ ability to plan for the future.
“Normally upon retirement, we will have certain plans in our mind on how to spend the money.
“We might look for suitable opportunities to invest and use some part of it for our children’s education, to settle bank loans or other things,” he added.
In Penang, industrial officer N. Balakrishnan, 54, said he was concerned that he might not be able to sponsor his daughter’s studies overseas on retiring next year if he is not able to withdraw all his EPF money.
“I know how to manage my money and I even had plans to invest the balance of the money either in unit trust funds or into a fixed deposit account,” he said.
In Taiping, factory worker Halim Abdullah, 50, said the matter was subjective and the EPF should allow contributors to make a choice regarding their savings.
“I have bank savings of RM50,000 and less than RM20,000 in the EPF.
“Of course I prefer monthly payments from the EPF because I already have an adequate amount of personal savings to depend on.
“But if I don’t have any personal savings in the bank, I should be allowed to withdraw one lump sum from the EPF,” said the father of three grown-up children.
Former petrol pump attendant Abdullah Mohamad, 82, who did not receive much EPF savings when he reached 55 as his employers went bankrupt, said it was a good idea not to pay in one lump sum.
“If the savings is paid in monthly allowance, it will be like a pension payment,” he said.
Security guard Abu Bakar Hussin, 43, was against the proposal.
“Why must the EPF keep our money? We have plans like performing the haj or building our house,” he said.
Ex-serviceman U. Rajoo, 61, said the argument that some contributors might waste their EPF savings was a trivial one.
“Maybe 15% of the contributors do that but the rest normally use it either to do petty business or for other uses.
“It is better to pay a lump sum to the contributors because it is their right to receive it,” he said.
Did you find this article insightful?