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Here's How To Maximise Your EPF Monies via MIS

Updated 29 Mar 2021 – By Kuah Soo Yee


To those who contribute to EPF regularly, did you know that you have the option to invest your EPF monies via Member Investment Scheme (MIS)?


So, what is MIS all about?



For your information, MIS has been introduced in November 1996 to let the EPF members enhance and boost their retirement savings. 

Under MIS, you may transfer part of your fund in account 1 (subject to eligibility) to invest in EPF approved investment via the appointed fund management institutions (FMIs) including Unit Trust Management Companies and Asset Management Companies. 

You would like to continue reading about MIS if you want to:

1. Have Some Control on EPF Investment

With MIS, you can decide to invest according to your risk profile. There are EPF approved investment options for you to match your objectives and risk appetite. 
 

2. Enhance Investment Return

Let’s look at the EPF Historical Dividend Rate. Just a few weeks ago, EPF announced the 2020 dividend rate for Conventional accounts (5.2%) and Syariah accounts (4.9%). How about the historical rate?


SK = Conventional Account , SS = Syariah Account | Source: EPF (as of 9 March 2021)

From the graph above, you can see that for the past 11 years, the EPF dividend rate has ranged between 5.2% - 6.9% (conventional account) and 4.9% - 6.4% (Syariah account). Via MIS, you may potentially increase your investment return and boost your retirement saving overall.
 

3. Have More Investment Exposure To Overseas Market 

How does EPF invest your money? EPF is mainly investing your money in the Malaysian market. As of December 2020, EPF invested 67% and 33% of its investment assets in Malaysia and outside Malaysia, respectively. If you would like to diversify more of your EPF money to the overseas market, MIS is the way! 

 

How to invest under MIS and how much do you need to start?

Eligibility For MIS:

  • Malaysians/ Permanent Residents/Non-Malaysians (registered as EPF members before 1 August 1998)
  • Below 55 years old
  • Have sufficient saving with the EPF



To confirm your eligible investment amount for MIS, you may check it under the i-Account website. Go to i-Account website →  withdrawal tab →  withdrawal eligibility → member investment scheme. The number appearing next to the member investment scheme is your eligible amount to invest via MIS. 

Not sure how to check your EPF i-Account online? Click THIS ARTICLE to help you get started.


You may invest up to 30% of savings above basic savings in account 1 with EPF.

The calculation on how much you can invest under MIS is as below:
(EPF account 1 value - required basic saving in account 1 based on your age) x 30%

Minimally, you need to have RM1,000 to start with MIS. 


Basic Saving Table from EPF website (as of 9 March 2021)

The minimum saving set by EPF will be updated from time to time. You may check out the latest minimum savings from the EPF website.


Sample calculation from EPF website (as of 9 March 2021)

You may continue investing via MIS every 3 months as long as your balance in account 1 exceeds your required basic savings and fulfils the EPF requirement.
 

Also, don’t forget to take note of the investment options under MIS

Under MIS, you may invest via EPF approved Unit Trust Management Companies and Asset Management Companies.
 
Investment Solutions
Unit Trust Management Companies Asset Management Companies
  • Companies that manage unit trust funds
  • Unit Trust Funds
  • Companies that manage investment according to their personal mandate.
  • Managed Account 
    - Portfolio of Shares
    - Portfolio of ETF
    - Portfolio of Unit Trust
 

Here’s a guide to know which solution to choose/suitable for you:

  Unit Trust Funds Managed Account
(Portfolio of Unit Trust)
What Do You Invest Into Invest in single unit trust funds Invest in a portfolio of different unit trust funds from various sectors
Investment Management Self-managed


You choose your own unit trust fund, or your agent may assist with the fund selection
Actively managed by the company

The company will construct, monitor and rebalance your  portfolio from time to time
Suitable For You If  You like to DIY on your own investment You are busy or unfamiliar with investment/ market conditions
Selection  Conventional or Syariah compliant funds Conventional or Syariah compliant portfolios
 


Other important points to note here before you start investing:

The amount you withdraw for MIS will not be eligible for the EPF dividend rate.

EPF has a minimum guarantee of 2.5% dividend, whereas your investment done via MIS does not come with any guaranteed return. You are solely responsible for the investment via MIS that you made. It means that you might get a higher or lower return compared EPF dividend rate, depending on your actual investment return 

Therefore, do understand the above-mentioned risk involved before proceeding. 

If you have further questions on how to go about your EPF investment via Member Investment Scheme, you may talk to financial professionals to discuss and design an investment plan that suits you in terms of investment objective and risk appetite.


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*The above article is intended for informational purposes only. Loanstreet accepts no responsibility for loss that may arise from reliance on information contained in the articles.


 
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