Those who are working under self employment are always subject to risk of inadequacy in the funding when they retire (well, to some extent, so are those who work for other people. Read: Worker has RM120,000 in EPF after 30 years). So the Employee Provident Fund, EPF is coming up with some ‘special’ retirement scheme beginning next year.
Called the 1Malaysia Retirement Saving Scheme, the program was introduced to manage the welfare of the self-employed who do not own or contribute to any formal retirement or saving scheme. The idea was first mooted by the Prime Minister, Datuk Seri Najib Tun Razak, during his presentation in the 2010 Budget a few months back.
Through the retirement scheme, the self-employed businessmen can contribute the monthly contribution based on their income, which varies depending on their business situations.
Unlike the normal workers who usually receive consistent wages throughout the year, the self-employed face different scenarios – they have slow months, average months, and good months. And the amount of the savings contributed to the 1Malaysia retirement scheme will reflect how well they do in particular months. More importantly, the individuals can decide on his/her own the amount he/she wants to contribute for their saving scheme.
The scheme is open to self-employed individuals such as traders, hawkers, real estate agents, as well as those doing jobs on freelance basis such as disc jockeys, dance instructors, singers and so on.
Contributors would receive annual dividends as declared by the EPF based on the business performance of the body. Those interested to take up the retirement scheme can fill the KWSP 16(G) form which is available from any EPF branches or download from EPF website at kwsp.gov.my.