Common Questions About EPF & Retirement Savings

Account 1 is your main retirement fund—you can’t touch it until you hit 55 (or meet other withdrawal conditions), and it’s meant to grow until retirement. Account 2 is more flexible and covers healthcare costs; you can withdraw up to 10% of your balance annually if you need it, and it’s designed for medical emergencies and smaller financial needs before retirement.

If you’re under 60, your employer contributes 12% of your basic salary and you contribute 8%—that’s a total of 20% going into your EPF account. Of that 20%, roughly 70% goes into Account 1 (retirement) and 30% goes into Account 2 (healthcare and flexibility). The exact split depends on your age, but the combined 20% is pretty consistent for most working Malaysians.

Voluntary contributions are worth considering if you want to boost your retirement savings and you’ve got some extra cash. Here’s the thing: every ringgit you contribute gets invested and earns returns—if you contribute an extra RM200 monthly for 10 years, you’re looking at way more than just RM24,000 because of compound growth. Plus, you get tax relief on voluntary contributions up to RM60,000 annually, which can bring down your taxable income.

i-Saraan is EPF’s voluntary contribution scheme specifically designed for self-employed people and those without traditional employment—it lets you contribute directly to build your retirement fund. You can contribute between RM10 to RM60,000 annually depending on your income, and like regular voluntary contributions, you get tax relief. It’s basically a way for freelancers, gig workers, and business owners to access the same retirement savings benefits as employed people.

You can withdraw from Account 2 anytime you need it (up to 10% annually), but Account 1 is locked until age 55—unless you’ve retired early, lost your job, become permanently disabled, or are emigrating. At 55, you can start withdrawing from Account 1, though most people use the Flexible Withdrawal option to take what they need while leaving the rest to keep earning returns. At 60, you must withdraw everything, but you can ask to keep some money invested if you want.

That depends on your salary, how long you’ve been contributing, and what returns you get. Someone earning RM3,000 a month and contributing for 30 years could realistically have somewhere between RM800,000 to RM1.2 million (depending on market returns), but someone earning RM6,000 would have double that. The best part? Every year you delay retirement, your money keeps growing—that’s why consistent contributions early on make such a massive difference in the long run.