i-saraan-kwsp-malaysia

i-Saraan (KWSP Malaysia)

i-Saraan (KWSP Malaysia)

i-Saraan is a voluntary EPF (KWSP) contribution program specially designed for:

  • Self-employed individuals
  • Gig workers (Grab, Foodpanda, freelancers, etc.)
  • Business owners
  • Housewives
  • Anyone without a fixed employer

You contribute voluntarily to your KWSP savings, and the government will give you a matching incentive.


What’s the Government Incentive?

The government will match 15% of your contribution, up to a maximum of RM500 per year. Your Yearly Contribution Government Incentive (15%)


How does it work?

  • Yearly Contribution: RM1,000 ; Return: RM150
  • Yearly Contribution: RM3,333: Return: RM500 (max)
  • Yearly Contribution: RM5,000; Return: RM500 (still max)


Assume

  1. You start from 18 years old
  2. You only invest RM3,333 per year under i-saraan and you get the RM500 matching grant
  3. The accumulated fund generate only 5% return per year thereafter


Question:

  1. At age 45 you would have invested 27 years x RM3,333 = RM89,991.
  2. How much would you have in EPF?
  3. What would be the Return to you?


Answer:

  1. Total Amount Paid Over 37 Years:
    You paid RM3,833 per year for 37 years.
    Total Paid = RM3,833/year x 37 years = RM141,821
  2. Simple Return:
    Future Value = RM412,301.26
    Total Paid = RM141,821
    Return = RM412,301.26 – RM141,821 = RM270,480.26
  3. Percentage Return
    = (RM270,480.26 / RM141,821) x 100%
    = 190.72%
  4. Simple Return per annum
    = 190% / 37 years
    = 5.14% per year


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