e-ISSN 2231-8542
ISSN 1511-3701

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Factors Associated with Savings and Withdrawals among Employees Provident Fund Members

Halimah Awang, Nur Fakhrina Ab. Rashid, Tey Nai Peng and Norma Mansor

Pertanika Journal of Tropical Agricultural Science, Volume 28, Issue 3, September 2020

Keywords: Assets, Employees Provident Fund, Malaysia, savings, withdrawals

Published on: 25 September 2020

Financial security in life after retirement is a serious concern among older people, particularly as Malaysia is becoming an ageing nation. This paper examined saving and dissaving behaviours among members of Employees Provident Fund (EPF) aged 55 years and older. It examined the association between EPF balance outcome with socio-demographic characteristics, income, and withdrawal. Using data collected through interview surveys at selected EPF counters throughout the country, it revealed that 75% of respondents had less than RM200,000 in their EPF accounts at age 55 and 84% of the respondents made some withdrawals before age 55 and 67% upon reaching age 55. Both withdrawals were largely made to purchase property, pay for children’s education, and settle housing or car loans. Findings also showed that education and monthly income were positively associated with EPF savings of at least RM200,000 at age 55 while the opposite was true for small withdrawal amounts made before retirement. This suggests that EPF saving is very much dependent on income which in turn is determined by educational attainment and longer working years. While it can be said that in general members withdrew their EPF savings to either save elsewhere or invest towards the accumulation of their wealth, more opportunities should be made available for people to work longer beyond mandatory retirement age.

ISSN 1511-3701

e-ISSN 2231-8542

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