Sunway University economist Dr Yeah Kim Leng said the amount, although small, can be seen as a means to raise retirement savings through income transfer. theSun theSundaily contribution Budget2023 EPF savings
Those nearing retirement without adequate savings will likely be caught in a poverty trap if they do not have other means of support. BernamapicEconomists have welcomed the government’s move to contribute RM500 in Budget 2023 for Employees Provident Fund members aged between 40 and 54 who have less than RM10,000 in their Account 1.
“The middle-aged group nearing retirement without adequate savings will likely be caught in a poverty trap if they do not have other means of support from family or income generated from ownership of fixed assets such as property, land or businesses. “The financial situation and needs of individuals vary. EPF withdrawals for specific needs are best treated on a case-by-case basis based on careful evaluation by EPF or the authority dedicated to helping distressed individuals,” he said.
“Hence, promoting greater economic dynamism, faster growth of high-value industries, and skilled job creation through advanced technology and digitalisation are needed to address the inadequate retirement savings,” he said. “An increase of 1% in government contribution to the EPF of these groups of contributors would be more impactful on their savings,” he added.
On Friday, Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim said the government aims to help individuals affected by the Covid-19 pandemic to rebuild their retirement funds.
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