This is worrying

Average worker will have RM120,000 in EPF

By ZULKIFLI ABD RAHMAN

KUALA LUMPUR: An average worker will have about RM120,000 in his Employee Provident Fund (EPF) account by the time he reaches the age of 55, Deputy Finance Minister Datuk Seri Ahmad Husni Hanadzlah said in Dewan Negara on Monday.

He added that the amount, which was calculated based on the person's working life of 30 years, would provide him with an average of RM500 in monthly returns for 20 years after reaching 55 years.

Ahmad Husni said the amount would enable him to meet basic expenditures.

However, the person must contribute more than RM120,000 to his EPF account to enjoy a more comfortable retirement life, he told Senator Ikhwan Salim Sujak.

Ahmad Husni said the EPF had strategies to ensure workers were prudent with their savings and they should invest their savings in proper schemes.

He also said EPF contributors were allowed to withdraw from Account II to buy a house or a second house if they had settled the loan on their first house.

To a question, Ahmad Husni said there were no plans to compel contracted or part-time workers to contribute to the EPF.

If the Minister thinks a person can retire with just RM120,000, he must be living in somewhere else. RM120,000 can't even get you a decent house in the Klang Valley today, let alone 20 years down the road. Hell, RM120,000 is barely enough to pay for a Civic or Altis!

I read in an article not too long ago highlighting the adverse condition of our pensioners. It showcased the plight of single pensioners, those without children or widowed. You see, in the past, a lot of government servant opt for pension instead of savings in EPF. The promise was that, upon your retirement, you will be paid half of your last drawn salary every month. If your last drawn salary was RM5000, then you will receive RM2500 every month until you die. Sounds good?

The problem was that most of these pensioners were at clerical level and back then they only receive about RM600 to RM800 a month. Back then, RM600 could feed an entire family. But now, RM600 could get you nowhere. Imagine getting half of that. Try to survive 30 days with a monthly income of RM300. And I am not talking just about food. Consider electricity, water, medical, clothing and other essentials as well!

We need to take inflation into the big picture. Last year, a bowl of noodles cost about RM3.50. Begining of this year, it was RM3.80. After the recent petrol hike, it sky rocketed to RM4.00. And that is just one year apart.

Live for another 20 years after reaching 55 years old with just RM120,000? You must be dreaming, Mr. Minister. The only solution is that either you die earlier or keep on working like a donkey. Sorry for such a grim fact.