Personal Finance Term
EPF / KWSP
Employees Provident Fund
Malaysia's mandatory retirement savings scheme for private sector employees, administered by KWSP (Kumpulan Wang Simpanan Pekerja). Both employee and employer contribute a percentage of monthly salary.
Employee contributions are split across three accounts: Account 1 (75% — retirement, cannot withdraw until 55), Account 2 (15% — housing, education, medical), and Account 3 (10% — flexible withdrawal). As of 2024, the EPF dividend has historically ranged from 5%–7% p.a. for conventional savings and 4.5%–6.5% for Shariah savings.
Employees earning below RM5,000/month contribute 11% of salary; above RM5,000 they may choose to contribute more. Employers contribute between 12%–13% depending on salary level. Total contribution (employee + employer) typically reaches 23%–24% of monthly salary.