M’sia & Australia Allow Their People to Draw Out Money from CPF During COVID-19 Period

As my illustrious colleague once said, Covid-19 isn’t just damaging to people’s health; it’s equally damaging, or worse, on our wallets.

The Singapore government is going to announce details for a second financial aid package for Singaporeans because it’s going to be a long fight.

And we’re not the only ones to do so.

Malaysia Allowing Citizens To Withdraw EPF 

First thing first, what’s EPF (Employees Provident Fund)? Basically, it’s their version of our CPF.

Image: memegenerator.net

On 23 Mar 2020, Malaysian Prime Minister Tan Sri Muhyiddin Yassin said that the authorities will allow Malaysians to withdraw money from their EPF accounts to tide over the tough period.

Malaysia has implemented a nationwide lockdown within the country, with only food businesses allowed to continue to operate.

It was slated to end on 31 Mar but could be extended by a further 2 weeks.

From 1 April, contributors to EPF under the age of 55 years old can apply to withdraw up to RM500 per month for “the next 12 months”.

This move is accompanied by a reduction of 4% in EPF contributions beginning Apr 2020.

With this, the Malaysian government hopes that their people would have more money in their pockets.

However, they hope that people wouldn’t splurge and instead, spend the extra cash on daily essentials, rental and bills.

Other initiatives include an increase in funding to buy healthcare essential items like ventilators and masks, as well as to hire more healthcare staff.

Loan repayment for the National Higher Education Fund Corporation (PTPTN) will also be extended to 6 months, he added.

He promises that more measures will come and he hopes it’ll make Malaysians’ lives better.

And Malaysia’s not the only country to allow withdrawal of their people’s “future money”.


Singapore has the CPF, Malaysia the EPF and Australia, the Super funds.

Here’s what Australia’s Super (or superannuation) fund is all about:

Superannuation (or “super”) is a compulsory system of placing a minimum percentage of your income into a fund to support your financial needs in retirement. Your super is invested in a range of assets to help grow your balance so you can have the best possible retirement outcome.

Basically, a cooler sounding name than CPF.

Similarly, on 23 Mar, the Australian government announced that they’ll allow individuals “in financial stress” to withdraw up to A$10,000 ($5,800) of their Super Fund in the financial year ending June 2020.

And from 1 July 2020, another A$10,000 ($5,800).

People who are eligible includes:

The amounts released will not be taxed and is meant for their people to meet mortgages, buy food and pay rent.


In addition, they’ve also cut the superannuation minimum drawdown requirements for account-based pensions and similar products by 50% for both FY2020 and FY2021.

Image: Imgflip

Yeah, it’s a bit cheem but here’s a simple explanation:

A minimum drawdown is basically the percentage a person must withdraw each year.

Which sounds like a great thing, right? Except it’s not.

Remember, the Super Fund helps to invest in a range of assets to help grow retirement accounts.

By having to take more out earlier, and at a time where the stock market is at an all-time low, older people will make a loss when they have to sell equity and bond investments to meet the minimum withdrawal limit.


With the reduction in minimum drawdown, people who do not need the money can choose to leave their assets in holding until the market improves, and they get better value from selling them.

Basically, those who need money can get them. Those who don’t need money urgently can let it grow within the funds.

Australia will also be providing a second rescue package worth A$66bn to support households on income support, help keep businesses afloat and people employed.

They’re not holding their breath either and predicted that a third package will be necessary in the next few months.

I Know What You’re Thinking:

Taking out CPF?! The Singapore government should totally let us do that too!


But here’s the thing: is being able to take out your CPF money really a good thing?

After all, you have to remember: What the Singapore government is doing now is to provide financial help with the government’s money.

But if you can withdraw money from your CPF account, that’s equivalent to using your own money to tide over this tough period.

And while you might not feel the effect now, trust us, you’ll feel this ten to twenty years later.

After all, you’re not just missing out on the sum. You’re also missing out on the interest that helps grow your retirement funds.

Basically, it’s like global warming lah.

Latest & Popular Articles You Must Not Miss:


Our Most Popular Videos You Must Not Miss: