Understanding EPF (KWSP) in Malaysia — A Complete Guide for Employees and Employers

If you work in Malaysia, EPF (Employees Provident Fund / KWSP — Kumpulan Wang Simpanan Pekerja) is the retirement savings scheme you cannot opt out of. But most people only vaguely understand how it works — until they really need to. Here's what every employee and employer in Malaysia should know. What Is EPF? EPF is Malaysia's mandatory retirement savings fund, governed by the EPF Act 1991. Every employee earns a monthly contribution split between themselves and their employer. The money is invested by KWSP and pays an annual dividend — historically 5–6% per year. It is not just a retirement fund . EPF has multiple accounts with different withdrawal rules, and you can use it for housing, education, health, and more. The Three-Account Structure (2024 Onwards) As of May 2024, EPF restructured from two accounts to three: Account Malay Name % of Contribution Purpose Withdrawal Akaun Persaraan Retirement Account 75% Retirement Age 55+ only Akaun Sejahtera Wellbeing Account 15% Housing, hea