Employees Provident Fund: Adequacy of Retirement Income Provision

Aims: Delve further into the Malaysia’s Employees Provident Fund (EPF) scheme by exploring the
perceptions of 300 retirees and prospective retirees on the adequacy of incomes in retirement
provided by the current EPF system.
Methodology: By employing the logistic model, the perceptions of 250 retirees and 50 currently
working employees, were evaluated as part of the overall assessment on the strategic pathway of the
EPF system towards becoming a reliable provider of financial security for elderly workers.
Results: The study obtained relatively similar results regarding key factors of retirement income
adequacy for retirees and prospective retirees. Key factors namely the number of dependent persons,
average non-EPF savings, housing loan, car loan and medical expenses are found to be negatively
related to retirement income adequacy.
Conclusion: Therefore, necessary improvements on the current EPF scheme need to be
implemented so that the provision of accumulated financial resources for both retirees and
prospective retirees aimed at ascertaining appropriate adequacy levels of retirement incomes can be
monitored in a timely manner.