The Employees Provident Fund (EPF) has announced a restructuring of its members’ accounts effective 11 May 2024 that seeks to enhance their income security after retirement while addressing members’ current life cycle needs.
Member accounts will be restructured from two (2) accounts namely Account 1 and Account 2 to three (3) accounts: –
- Akaun Persaraan to accumulate savings that will serve as income during retirement;
- Akaun Sejahtera to address life cycle needs that contribute to wellbeing during retirement; and
- Akaun Fleksibel as a new account that provides flexibility for short-term financial needs. Savings in this account can be withdrawn at any time according to members’ needs.
Mechanics of the EPF Account Restructuring
Starting from May 11, 2024, EPF members under 55 years old will have their accounts restructured into three: Retirement Account, Wellness Account, and Flexi Account. Balances in Account 1 and Account 2 will move to Retirement Account and Wellness Account respectively, while Flexi Account will begin with zero balance.
Contributions after May 11, 2024, will be distributed into these accounts as follows: 75% into Retirement Account, 15% into Wellness Account, and 10% into Flexi Account.
Between May 11, 2024, and August 31, 2024, members have a one-time option to transfer part of their savings from Wellness Account to Flexi Account. If not opted in, the existing balance remains in Wellness Account.
Flexi Account will receive new contributions after the implementation date. If members opt-in for an initial transfer, it will be based on their Wellness Account balance on the opt-in date. The transfer follows the breakdown below:
To know more, refer here.