Update – EPF Withdrawal For Unit Trust Investment
Effective 1 February 2008, the amount eligible for EPF members’ investment withdrawal from Account 1 will vary according to members’ age as in the chart below. This gives younger people with smaller amounts in the EPF the choice to invest in Unit Trust using their EPF money. In the past, you must retain RM 50,000 in your account 1.
Old Formula
If you have a total of RM 100,000 in your EPF (assuming you have not withdrawn any amount to buy a home or pay down you home loan), your Account 1 will have 70,000. Of this amount, you can withdraw 20% above 50,000. This works out to be
20% x (70,000 – 50,000) = 4,000
Therefore 4,000 is the maximum amount you can withdraw.
New Formula
Mandatory amount to be retained in Account 1 (Account 1 is forms 70% of the total amount in your EPF). Instead of a fixed amount of 50,000 in the past, the mandatory amount is different based on different age.
Examples of calculation for withdrawal
Eg. if you are age 25 and have 20,000 in Account 1 (with a total of 28,572 in your EPF), you can withdraw 2,200 to invest. In the past, you will not be eligible to make any withdrawal.
Other conditions are:-
- Amount eligible for investment must not be more than 20% of the total actual savings in excess of the Mandatory Retained Amount in Account 1.
- The minimum investment amount must not be less than RM1,000.
- Investments can be made at intervals of three months from the date of the last transfer from EPF, subject to the investment eligibility
Note: For older people, this new formula works against them.