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Working an extra five years could increase retirement savings by as much as 40%, according to the Employees Provident Fund (EPF), amid longer life expectancy and rising living costs
EPF chief executive officer Ahmad Zulqarnain Onn said the projection is based on simulations assuming a 5% annual dividend return and a 3% yearly salary increase.
"Working five years longer can increase retirement savings by about 40%, assuming a 5% annual dividend return and a 3% annual salary increment," he said.
Malaysia's average life expectancy is expected to rise from 76 currently to 81 by 2050.
This shift is increasing pressure on retirement adequacy, making long-term financial planning more critical than before.
EPF said extending time in the workforce could help individuals better cope with a longer retirement period and higher cost of living.
There won't be any immediate changes to the retirement age, at least for now
Currently, Malaysia's minimum retirement age is 60, while EPF members can fully withdraw their savings at 55, a structure that has remained unchanged since the fund was established.
Ahmad Zulqarnain stressed that any revisions to the retirement age or withdrawal policies would require careful evaluation, according to the New Straits Times.
He said factors such as health conditions, job sectors, and overall worker wellbeing must be taken into account before any decisions are made.
How EPF is trying to get Malaysians to save longer
To address the gap between withdrawal and retirement ages, EPF introduced the Akaun Emas (Golden Account).
Under this system, contributions made after the age of 55 are placed into a separate account that can only be withdrawn at 60.
According to Ahmad Zulqarnain, this ensures savings continue to grow during those additional working years.
"This encourages longer-term savings and reduces the risk of insufficient retirement funds," he said.
Ahmad Zulqarnain Onn.
Image via Harian MetroThe bigger picture
EPF continues to emphasise early financial planning as Malaysians face a future where they are likely to live longer and need more money to sustain those extra years.
The fund maintains that stronger retirement resilience will depend not just on policy, but on how early and consistently individuals build their savings.
