by VEISHNAWI NEHRU

THE Employees Provident Fund (EPF) has launched the Belanjawanku 2024/2025 and the Retirement Income Adequacy (RIA) Framework, providing a comprehensive monthly expenditure guide and introducing a new three-tier savings benchmark to help Malaysians better plan for their retirement.  

Developed in collaboration with the Social Wellbeing Research Centre (SWRC) at Universiti Malaya, the Belanjawanku Guide estimates the minimum monthly expenses required for a decent living standard.

Initially focused on the Klang Valley, the guide now covers 11 major cities nationwide, offering a practical reference for households and policymakers alike.

EPF CEO Ahmad Zulqarnain Onn said the guide has played a pivotal role in revising EPF’s savings benchmarks. The framework transitions from the single-tier basic savings benchmark introduced in 2008 to the newly announced three-tier RIA Framework, which will take effect in January 2026.

He added the categories include basic savings of RM390,000 for essential retirement needs, adequate savings (RM650,000) for a reasonable standard of living and enhanced savings (RM1.3 million) for greater financial independence and a higher quality of life.

“These savings targets are designed to support a 20-year monthly withdrawal plan, reflecting Malaysia’s average life expectancy. For instance, RM650,000 in adequate savings enables monthly withdrawals starting at RM2,708 in the first year, growing to RM7,389 by year 20.

“Similarly, RM390,000 in basic savings provides RM1,625 initially, while RM1.3 million in Enhanced Savings offers RM5,417 in the first year, increasing to RM14,779 by year 20,” he said in a statement.

Ahmad Zulqarnain added that to ease the transition to the revised benchmarks, EPF will gradually increase the basic savings amount from RM240,000 to RM390,000 over three years.

The phased increments are RM290,000 by January 2026, RM340,000 by January 2027 and RM390,000 by January 2028.

Starting in 2029, these benchmarks will be adjusted every three years to account for rising living costs, guided by updated Belanjawanku data.

Ahmad Zulqarnain said RIA savings levels will be reviewed every three years to adjust for rising living costs.

“Members with savings over RM1 million can withdraw funds aligned with the enhanced savings benchmark, and 30% of savings above the basic savings amount can be transferred to approved funds,” he explained.

He said the initiatives not only underscore EPF’s commitment to adapting to evolving socioeconomic realities but also reflect its objective to stay relevant and responsive to changing times.

“Our goal is to ensure that no Malaysian is left behind in planning for a secure and meaningful future,” he added.