Retirement may seem like a distant goal for many Malaysians, but the latest figures suggest millions could be entering their later years without enough savings. While more Employees Provident Fund (EPF) members are now meeting the EPF Basic Savings benchmark compared to last year, the majority are still falling short. According to the latest figures presented in Parliament, nearly 62% of active contributors have yet to reach the recommended savings level for their age, highlighting the ongoing challenge of building adequate retirement funds.
More Malaysians Are Meeting The EPF Basic Savings Target
Deputy Finance Minister Liew Chin Tong told the Dewan Rakyat that, as of 31 May 2026, 3.04 million active Malaysian EPF contributors aged between 18 and 60 had achieved the EPF Basic Savings target based on their age.
This represents 38.3% of the 7.94 million active contributors within that age group.
The figures show encouraging progress compared with the previous year. As of 31 May 2025, only 2.71 million members, or 35%, had reached the benchmark.
However, the latest data also reveals the bigger picture. Around 4.9 million contributors, or 61.7% of active EPF members, still have not reached the EPF Basic Savings target, indicating that retirement preparedness remains a concern for a large portion of the workforce.
What Is EPF Basic Savings?
The EPF Basic Savings benchmark is part of the fund’s Retirement Income Adequacy Framework, which helps members understand how much they should accumulate throughout their working lives.
Under this framework, members are encouraged to have RM390,000 in their EPF account by the age of 60.
According to EPF, this amount is expected to provide an estimated RM1,625 per month for 20 years, covering the retirement period between the ages of 60 and 80. It is intended to support essential living expenses rather than a luxurious retirement lifestyle.
The EPF retirement framework consists of three savings levels:
- Basic Savings: RM390,000 by age 60
- Adequate Savings: RM650,000 by age 60
- Enhanced Savings: RM1.3 million by age 60
While the EPF Basic Savings level is considered the minimum benchmark for essential retirement needs, the higher tiers are designed to provide greater financial security and flexibility during retirement.
New EPF Initiatives To Help Malaysians Save More
To improve retirement preparedness, the government and EPF have introduced several initiatives aimed at encouraging higher contributions.
One of the latest programmes is i-Saraan Plus, which allows gig workers, e-hailing drivers, delivery riders and other self-employed Malaysians to make voluntary EPF contributions.
Another initiative, i-Simpan, enables members to make voluntary contributions of up to RM100,000 annually, allowing those with additional income to build their retirement savings faster.
Employees and employers can also contribute above the statutory EPF contribution rate through i-Topup, helping members accumulate larger retirement balances over time.
Meanwhile, i-Legasi, introduced in February 2026, allows eligible members aged 55 and above with savings exceeding RM650,000 to transfer part of their EPF savings to their children’s EPF accounts.
As of May this year, 63 applications had been approved under i-Legasi, benefiting 86 recipients with transfers amounting to RM46.3 million.
Why Many Malaysians Still Struggle To Reach EPF Basic Savings
Although more savings options are now available, many Malaysians continue to face financial pressures that make retirement planning difficult.
Rising costs of housing, groceries, transportation, education and healthcare leave many households with little disposable income after meeting their monthly commitments. As a result, voluntary retirement contributions are often not a financial priority.
For self-employed individuals and gig workers, income can vary significantly from month to month, making it difficult to contribute consistently even when schemes such as i-Saraan Plus are available.
Career breaks, unemployment, and periods outside the formal workforce can also interrupt EPF contributions, reducing long-term savings growth through the loss of both contributions and compound returns.
These factors mean that while government initiatives can create more opportunities to save, the ability to take advantage of them often depends on an individual’s financial circumstances.
Building Retirement Security Requires More Than New Schemes
The latest parliamentary figures show that Malaysia is making gradual progress, with more contributors reaching the EPF Basic Savings benchmark than a year ago.
However, the fact that nearly six in every 10 active contributors remain below the recommended savings level highlights that retirement adequacy continues to be a national challenge.
Strengthening retirement security will require more than additional savings programmes. Stable employment, sustainable wage growth, higher productivity, and the ability for Malaysians to save consistently throughout their working lives will all play an important role in helping more people achieve the EPF Basic Savings target and enjoy greater financial security during retirement.
Sources: 1| 2| 3
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