6 REASONS TO INVEST WITH YOUR EPF MONEY

Reason No.1

EPF dividends for the last 5 years has reported annualised returns of 5.38% p.a.

Annualised returns from properly constructed Unit Trust Portfolios has recorded annualised returns
over the last 5 years of not less than 13% p.a.

Annualised returns from properly constructed Bursa Shares Portfolios has recorded annualised
returns over the last 5 years of not less than 8 % p.a.

Reason No.2

As at 30 June 2011, EPF has given out loans to the government totalling RM83.70 billion. This
represents more than 60% of the EPF investments. It is therefore highly unlikely that EPF returns
would be able to surpass the annualised return exceeding 6.00% p.a. It is useful to note that the
total government debt as at 31 December 2010 stood at RM407 billion ringgit.

Source : The Star

Reason No.3

EPF introduced the “ EPF Member’s Investment Withdrawal Scheme” to allow you to increase
your retirement fund to support your life after retirement. “ This means that the Government has
handed you the opportunity to make your EPF money to work harder for you.

Reason No.4

Inflation erodes your purchasing power. Over the last 5 years, the EPF distributed an average of
5.38% dividends annually while the inflation rate averaged 2.7%. Thus you should make the best use
of withdrawal scheme allowed by EPF to ensure that you preserve the purchasing power of your EPF
money in future.

Reason No.5

You should let the power of compounding work for you. Albert Einstein famously said: “compound
interest is the eighth wonder of the world. He who understands it, earns it “. Thus you should let
some of your EPF money compound at a higher rate of return. Even a small positive difference in
annual return can make a big difference over time. To give you a better idea of the power of
compounding, you can use the Rule of 72.

If your money earns 5% a year, it will double in 14.4 years. If it earns 13% p.a., it will double in 5.5
years. For 8 % p.a. return, your money doubles in 9 years. ( to calculate the number of years for your
money to double, divide 72 by your rate of return )

Reason No.6

Investing in unit trusts and shares may be risky and may not get you the desired returns. A licensed
financial planner with an investment methodology and proven track record of investment success
can ensure that your investment objective to gain higher returns are met.