This was the Question of the Month in Issue #93 of Personal Money Magazine. And below were the letters published:
Best Letters #1, Quah Su Boon. Selangor
My first priority has always been to reduce my home loan as soon as possible. I applied for monthly withdrawals from Account 2 to reduce my flexi home loan. In doing so, I am on track to reducing my loan tenure from 30 years to less than 10 years. In addition, I made use of some of the Quarterly Withdrawal Option from Account 1 to invest based on the ringgit cost-averaging concept in the middle of last year. I selected equity funds as most battered down 20% to 30% and it was an opportunity to accumulate on recovery in the next three to five years!
My first priority has always been to reduce my home loan as soon as possible. I applied for monthly withdrawals from Account 2 to reduce my flexi home loan. In doing so, I am on track to reducing my loan tenure from 30 years to less than 10 years. In addition, I made use of some of the Quarterly Withdrawal Option from Account 1 to invest based on the ringgit cost-averaging concept in the middle of last year. I selected equity funds as most battered down 20% to 30% and it was an opportunity to accumulate on recovery in the next three to five years!
Best Letters #2, Tarzo, Selangor
Nothing. Although there several withdrawal options available, I do not intend to take advantage of them. The EPF money shall form the cash portion of my retirement portfolio as it gives better returns than fixed-deposit rates, yet has lower risks. Funds held in the EPF account are risk-free as they are government guarantee while bank deposits are only guaranteed up to RMN60K by Perbadanan Insuranse Depost Malaysia (note: the mini budget has lifted the ceiling amount until end-2010). Once you withdraw any amount from EPF, you annot “re-deposit” it.
Letter 3, Hew Foo Lim, Pulau Pinang
The EPF is currently the main source of retirement income for Malaysians. How can we enhance our EPF funds, apart from the dividends (averaging 5%) that EPF pays annually? I have been withdrawing from Account 1 to invest in unit trusts, which is the most ideal investment instrument to generate potential higher returns in the long term. I practice dollar cost averaging as I withdraw the money quarterly to invest with reputable fund houses.
The EPF is currently the main source of retirement income for Malaysians. How can we enhance our EPF funds, apart from the dividends (averaging 5%) that EPF pays annually? I have been withdrawing from Account 1 to invest in unit trusts, which is the most ideal investment instrument to generate potential higher returns in the long term. I practice dollar cost averaging as I withdraw the money quarterly to invest with reputable fund houses.
The question remains, so what do I do with my EPF money? With so many advices and tips around, how do I make the choices? Most importantly, set your objective, know your risk profile and equip yourselves with the basic financial knowledge, and make your own decision!
The question remains, so what do I do with my EPF money? With so many advices and tips around, how do I make the choices? Most importantly, set your objective, know your risk profile and equip yourselves with the basic financial knowledge, and make your own decision!
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