Tuesday, June 19, 2012

EPF, I want to withdraw all my money by 55

It is a cause for concern when there are mentions of we may not be allowed to withdraw all our money come 55. There's no smoke when there's no fire. Here, I am not saying that EPF is mismanaging our money. I will be fair with my reasoning.

The very government that has asked to believe in them for indebting the nation further has asked us to trust them in managing our money for us. It is already a cause for concern when we have continued to be in budget spending deficits over the last 14 years until we are to reach a total debt to GDP of almost 55%. Yes, these numbers are better than some European nations but until when you are to continue to overspend. For a government who continues to overspend, how are we to entrust our lifelong savings to you until our late age in life.

While it is true that over the last decades, EPF has done a decently good job at managing our savings fund, it does not mean that we can blindly allow you to continue to manage these funds until we are 60. What happens to the call for us to have money management education? When you hold a large sum of our savings and you feel that you can manage them better we will not have the experience and ability to proof to you aren't we? Since when does the government knows better, and has proven that they have acted best for its people until we are to assign a huge chunk of our savings to you to manage?

With the EPF's fund growing at much more than RM1 billion a month, I am sure you already have problems allocating these money. Already, EPF's investment into equity is reaching 35% of the total fund size of a staggering RM475 billion. The last few years I am noticing that it is getting more and more difficult to put those money in the Malaysian equity market. Which is also why you have gone to buying properties in UK and more recently into Australia. Our money in EPF is now being used to own PLUS. Not a bad move, but it shows that managing these funds successfully is getting tighter. How many more PLUSes are there? Already, the fund is asking for more allowances to invests these money overseas. How confident are you in making a better return overseas? Remember, by going overseas, you will not be given with the same preferential treatment as in locally. Sometimes, a large fund such as EPF may even be treated to be a sucker for deals.

In fact, I have felt that Khazanah has been suckered in the private healthcare deal in Singapore and Turkey. How sure are we EPF will not be treated the same when you are moving more aggressive overseas?

Moreover, while there are calls for us to work until 60, at 55 years of age it is important for us to be allowed to enjoy some of our savings. I am sure there are better ways than for the government to continue to say that it is better for them to manage those funds for us. If there are those who prefer to park their money in EPF, let them do so. Create an annuity fund, if you may. However, do allow for those who feels that they can do better without EPF's assistance. Let us have liberty to choose. As it is now, the option is very limited.

This very idea and mentality of government knows best is perhaps the very reason where you have ballooned up our nation's debt. Maybe it is better to give us back the money at our earlier age so that we can have better and more careful planning with them. After all it is still our money!

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