Mixed reactions to EPF RM500 one-off incentive

KUALA LUMPUR: Employees Provident Fund (EPF) announcement of a one-off RM500 government additional contribution incentive sparked mixed reactions on social media.

Some viewed the initiative as a positive step towards encouraging individuals with lower savings nearing retirement age to continue saving for their retirement.

They say it is a beneficial incentive to accelerate the accumulation of retirement funds.

A user from the X platform, @AbeMicksuka said the incentive is better compared to having no savings at all.

"After 20 years, the initial RM500 will multiply to RM1,556 (assuming an average dividend of 5.5 per cent), resulting in a total savings contribution of RM2,056.

"It may not be a groundbreaking solution to address savings shortages, but at least it's better than having nothing at all," he added.

Another user @Ashika0409 said citizens should be grateful for the assistance instead of criticising it as if it were disposable income.

"People should be grateful that the Federal Government also provides assistance by contributing RM500 to the EPF.

"This group doesn't seem to understand that the EPF is retirement savings, not for spending money recklessly."

However, some netizens criticised the initiative, highlighting concerns about individuals who, despite not actively contributing to EPF, still receive the RM500 assistance.

User @IlliFadli commented: "This should be rectified. Perhaps there are those who are not active contributors but still have a significant amount of money in the bank, yet they also enjoy the RM500.

"For instance, they contributed to the EPF at the age of 21, and after a year, they went to work overseas and stopped contributing. However, they benefit financially," said the user.

Another user @vhsvhs73 questioned the effectiveness of the RM500 incentive in encouraging individuals to save more.

"How will this encourage individuals to enhance their savings when they are the ones withdrawing money for spending and never bothering to contribute to EPF in the first place?"

Earlier today, it was reported that EPF announced that it had disbursed RM500 one-off government additional contribution incentive to 1.4 million members with EPF savings of RM10,000 or less in their Account 1 as of Feb 24, 2023.

The RM708 million payout is specifically for members aged between 40 and under 55 years of age. The contribution incentive was announced during the tabling of 2023 Budget on Feb 24, 2023.

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