[Updated] Everything You Should Know About EPF Account 3

Since May 2024, EPF members below age 55 have had their member accounts restructured from two (2) accounts namely Account 1 and Account 2 to three (3) accounts.

We have compiled a basic guide with all the frequently asked questions by EPF members on this restructuring.

Akaun Persaraan, Akaun Sejahtera and Akaun Fleksibel

The current Account 1 and 2 has now been renamed Account Persaraan and Akaun Sejahtera respectively. Meanwhile the new Account 3 is known as Akaun Fleksibel.

1. Akaun Persaraan – to save for income during retirement;
2. Akaun Sejahtera – to pay more major life cycle needs that contribute to retirement wellbeing
3. Akaun Fleksibel – new account for short-term financial needs that can be withdrawn any time

One time option to transfer part of EPF savings into Account 3 (Akaun Fleksibel)

If you qualify (under age 55) and do nothing, your existing funds in Account 1 and 2 will remain untouched and Account 3 will start from zero balance. 

However, EPF members who qualify have been given a ONE time option to transfer part of their savings in Account 2 (Akaun Sejahtera) to the new Account 3 (Akaun Fleksibel). The time given is between May 11 until August 31, 2024. If you do not choose to opt-in for this option, no transfer will be made. The existing balance will remain in Akaun Sejahtera.

How does the opt-in for initial transfer to Account 3 work?

If the member chooses to opt-in for an initial amount, the transfer of the initial amount to Akaun Fleksibel and other accounts (if applicable) is based on the balance in the member’s Akaun Sejahtera on the date the opt-in application is made. If you have more than RM3,000 in Account 2 when opting in, a percentage will also be transferred into your Account 1 along with the percentage transferred into Account 3.

Below is the sample calculation provided by EPF on how the initial transfer opt-in will be calculated based on a member’s Account 2 (Akaun Sejahtera) having more or less than RM3,000 in savings.

Source: KWSP

If the member chooses to opt-in for an initial amount, the transfer of the initial amount to Akaun Fleksibel and other accounts (if applicable) is based on the balance in the member’s Akaun Sejahtera on the date the opt-in application is made. If you have more than RM3,000 in Account 2 when opting in, a percentage will also be transferred into your Account 1 along with the percentage transferred into Account 3. The distribution is as follows:

Remember, you can choose the opt-in transfer to Account 3 (Akaun Fleksibel) only one time. This is from May 11 until August 31, 2024. After that deadline, the opt-in cannot be cancelled.

If you qualify and want to opt-in, submit your application through the KWSP i-Akaun application or at the Self-Service Terminals at any EPF branches nationwide.

How to withdraw from Account 3 (Akaun Fleksibel)

Withdrawals from Akaun Fleksibel can be made any time with a minimum withdrawal amount of RM50.

Members who want to withdraw can make the application online through KWSP i-Akaun or at any EPF branches nationwide.

If you do not have i-Akaun, you are encouraged to register with KWSP i-Akaun. By registering, you can just do the withdrawal transaction directly from your Akaun Fleksibel online.

Akaun 55 and Akaun Emas update

According to EPF, similar to current practice, all savings in Akaun Persaraan, Akaun Sejahtera, and Akaun Fleksibel of members who have reached age 55 will be merged into Akaun 55.

New contributions from members aged 55 and above will go into their Akaun Emas.

What is the purpose of Account 3 (Akaun Fleksibel)

The main purpose behind the implementation of Account 3 is to help EPF members sustain their livelihoods before retirement.

The Account 3 initiative came about after several COVID-19 related withdrawal programmes drained up to RM145 billion from the EPF. As of December 2023, EPF’s investment assets stood at RM1.13 trillion.

As such, the proposal of Account 3 was to assist EPF members with emergency cash needs. It also aims to attract those in the informal sector to make contributions to the EPF.

What is the dividend for Account 3?

As the money in Account 3 is not expected to be stored there for long periods of time, there is speculation that it will command lower returns overall compared to Account 1 and 2. However, the statement issued by EPF made no reference to the returns for Account 3 (Akaun Fleksibel). 

According to a Bernama report quoting EPF, the “dividends will remain the same across all three accounts”.

“However, this could change in the future as liquid assets by default do not attract higher interest rates or dividends.” EPF CEO Ahmad Zurqarnain Onn told the news service.

Check your EPF account through the new i-Akaun app

The updated app, called KWSP i-Akaun, features innovative and interactive features to make the user experience better.

EPF’s revamped app is a welcome new addition, as the previous version of the app has built an unsavory reputation of being slow and unwieldy for the visitors.

Some features included in the latest version are a more user-friendly interface that lets contributors check and monitor their contributions and investment growth and real-time access to financial information.

In addition to the new features, the new app also adds a function for users who have not registered as EPF members can now open an account directly through the EPF i-Akaun application using the e-KYC process.

Registration is open to all Malaysians or permanent residents who are not yet EPF members between the ages of 14 to 75. If you have registered already, you can log in using your i-Akaun user ID and password.

Steps to activate i-Akaun

If you haven’t registered as an EPF member, you need to do this first.
1: Download the KWSP i-Akaun app via Apple App Store or Google Play Store
2: Select the option ‘Not yet registered as member or i-Akaun?’.
3: Complete the electronic Know-Your-Customer (e-KYC) process and key in the required information.

After your registration as a member is completed, you can continue to register for your i-Akaun.
4. Just click ‘Ya’ (Yes) to continue and ‘Teruskan’ (Proceed).
5. Key-in your User ID, password, Secret Phrase and select your Secure Image.
6. Review and verify your personal information. Click ‘Sahkan’ (Confirm).
7. Read the terms and conditions. Click ‘Setuju’ (Agree).
8. Step 4: Wait for the notification signifying successful i-Akaun activation. Click ‘Selesai’ (Completed)

You can then use your User ID and password to log in to perform your transactions.

To get started, you can download the i-Akaun app on their page here.

This article has been updated on August 29, 2024.