10 Things You Should Know About EPF i-Invest
Did you know that the Employees Provident Fund (EPF) has an online platform that allows you to diversify part of your EPF savings in approved unit trust funds? In fact, the platform, EPF i-Invest, has been around for a year.
But if you aren’t familiar with the platform, you could be missing out on a lot of great features and benefits that can directly impact your retirement savings.
Not to worry. Here are 10 things you need to know about how you can diversify your retirement savings with EPF i-Invest and Principal Asset Management (Principal).
1. I’m happy with my EPF returns – why should I start investing?
Yes, EPF has historically performed well, averaging at around 6% p.a. in the past 10 years.
But with EPF i-Invest, you’ll have the opportunity to invest part of your savings in approved unit trust funds for potentially greater returns. This means having more control over your savings and being able to improve your chances of reaching your retirement goals. For more information on fund performance, refer to point 7 below.
2. Am I eligible to invest in EPF i-Invest? And how much can I invest?
To invest, you’ll need to meet these criteria:
- Malaysian, Permanent Resident or non-Malaysian (who registered as EPF Members before August 1, 1998)
- Have sufficient savings with EPF
- No minimum or maximum age limits, but there are different requirements if you are aged 55 years and above:
|Can invest up to 30% of the total savings exceeding the Basic Savings in Account 1.||Can invest any amount from Akaun 55 or Akaun Emas, as long as you retain RM1,000 in the account.|
To view how much you can invest with EPF i-Invest, just log in to your EPF i-Akaun → click ‘Investment’ → ‘Transaction’ → ‘Buy’:
3. Do I need to pay any fees?
These are the fees when investing with Principal via EPF i-Invest:
|0%. From now until April 30, 2021, you’ll incur 0% sales charges for investing via EPF i-Invest.||Typically up to 1.80% per annum. But you don’t need to worry about forking out any cash, as it’s included in your fund purchase.||Will not be imposed if switching is made to a fund with lower or zero sales charges.|
Since there is 0% sales charges until April 30, 2021, there are no switching fees until then.
|Varies according to fund|
To view the charges by FMI, just log in into EPF i-Akaun → click ‘Investment’ → click ‘Transaction’ → ‘Charges’:
4. Can I invest with EPF i-Invest if I already have a unit trust agent?
Yes, you can! You can choose to invest via a unit trust agent or the EPF i-Invest platform, or even both.
|Investing through a unit trust agent||Investing through EPF i-Invest|
|● Face-to-face interaction and advice|
● Helps determine your risk profile and which funds are suitable for you
● Will submit your documents for you
|● Do-it-yourself investing
● No physical documents to fill up
● Invest anytime, anywhere online
● You can invest with more than one FMI
● View all your investment holdings from different FMIs
|Sales Charge: maximum of 1.5%*||Sales charge: 0%*|
5. How do I redeem my investments when I reach my investment goals?
To redeem your investments, you can sell them through the EPF i-Invest platform. Here’s what happens with the sales proceeds:
|The sales proceeds will be deposited back into your EPF Account 1.||The sales proceeds will not be returned to your EPF account, but will be deposited into your personal bank account.|
6. Can I continue to invest after I have redeemed my investments?
Yes, you can.
However, after you redeem your investment, you may not be able to re-invest these funds immediately. That’s because EPF refreshes your eligible investment amount every three months, so you’ll need to wait for the next refresh to see an increase in your eligible investment amount.
To check when your eligible investment amount will be refreshed, log in to your EPF i-Akaun, click ‘Investment’ → ‘Transaction’ → ‘Buy’:
7. Which funds should I invest in?
The right funds for you depends on how much risk you can tolerate, and how long you have until you retire. You can use this short quiz to figure out what type of investor you are.
You can also refer to this list of recommended funds according to risk tolerance:
You can also invest in a range of Shariah-compliant funds through Principal and EPF i-Invest.
However, investment returns with EPF i-Invest are not guaranteed, so you’ll also need to do your research to select performing funds. Use the Fund Selector (under Fund Tools) to analyse and compare information on any approved unit trust funds. It also helps you select the right funds based on your preferences. You can explore funds by using the following filters:
- Fund category (equity, bond, money market, mixed asset and property)
- Fund volatility (very low to very high)
- Fund consistent return rating
- Shariah or conventional
You can also use the Chart Centre tool (under Fund Tools) to compare fund performance. You can compare up to eight funds at once and view their historical annualised returns of up to ten years.
Here are a few featured funds by Principal with a range of objectives and prospects:
|Principal Greater China Equity Fund||China, Hong Kong and Taiwan||Achieve medium to long-term capital growth primarily through investments in a portfolio of equity securities||11.18%||https://bit.ly/Greater-China|
|Principal Global Titans Fund||US, Europe and Japan||Grow the value of investments over the medium to long term in an equity fund that invests in the global market with an exposure to the Malaysian equities market to balance any short-term volatilities.||6.78%||https://bit.ly/GlobalTitan|
|Principal Asia Pacific Dynamic Income Fund||Asia Pacific ex Japan||Provide regular income by investing, and at the same time aims to achieve capital appreciation over the medium to long term.||5.54%||https://bit.ly/APDIFund|
|Principal Islamic Asia Pacific Dynamic Equity Fund||Asia Pacific ex Japan||Achieve long term capital appreciation and income while complying with Shariah investment criteria, through investments in emerging and developed markets||4.76%||https://bit.ly/IAPDEFund|
|Principal Titans Income Plus Fund||Malaysia + Asia Pacific ex Japan||Provide an opportunity to gain consistent and stable income by investing in a diversified portfolio of dividend yielding equities and fixed income securities.||3.56%||https://bit.ly/TitansIncomePlus|
However, past performance does not necessarily indicate future performance. Your returns with EPF i-Invest also depends on the economic outlook and your risk appetite.
8. How often should I invest?
You can invest any time, as frequently as you want. However, your eligible investment amount will only refresh every three months.
If you are risk-averse, breaking your available money into smaller amounts and investing at a fixed schedule (also known as dollar-cost-averaging) can help you avoid investment losses in the short run. By keeping some of your money uninvested, you’ll be able to invest in more units if the market declines. This approach can be useful for minimising risk during an uncertain or volatile market.
A fixed schedule also helps you avoid investing based on market performance, which can lead to emotionally driven investing decisions that could negatively impact your returns.
9. How do I start investing with EPF i-Invest?
Here’s how to get started with EPF i-Invest and Principal:
10: How long does it take to process my EPF investment?
|Purchase||On weekdays,the cut-off time for transactions is at 4pm. All transactions before 4pm will follow the price on the day you perform the transaction.|
On weekends or public holidays, all transactions will follow the price on the next business day.
|Within 4 business days||T + 5 days|
|Switching||T + 4 days|
|Redemption||T + 4 days|
Take control of your retirement planning
Diversifying part of your EPF savings gives you greater control over where your savings are invested and can help you reach your retirement goals. Find out more about EPF i-Invest and Principal today.
Principal is also rewarding all new EPF i-investors now until 31 December 2020.
Earn an RM50 Touch ‘n Go eWallet reload pin when you deposit a minimum of RM2,000. Terms and conditions apply.