Withdrawing EPF money for Holidays

While I was in Malaysia, I heard a story that I thought was rather… shocking.

There’s this person that lives around my neighbourhood. He recently went overseas for a holiday.

What is shocking is that he had withdrawn a sum of money from his Employees’ Provident Fund (EPF) account to fund his holiday trip. In Australia, their version of EPF is called Superannuation Fund, and in the US, if I’m not mistaken, social security right?

Now that’s a ‘smart’ move don’t you think? Take note that he still has a lot more years to go through before his retirement.

I have no idea how is it possible for a person to withdraw money from their EPF accounts to purchase unrelated goods and services. I’m not really that familiar with EPF and its practices but I thought that you can only take out your money for certain things only? Like paying off your home mortgage, your children’s tertiary education, buying a computer, and etc., but for holidays? Hmm…

There’s a reason why it is called a retirement fund.

Now, to me, I think the money can be put to better use. Say, for investments? Then, use some of the profits from that investment to fund your holiday trips. If it is not enough to fund your Europe Tour, then settle for something low-key, such as a trip to Phuket? or Bali? Living within your means is the way to go.

However, of course, at the end of the day, it’s his money, he can do whatever he wants with it. Just that I hope, his actions now will not catch up to him in the future (not being able to enjoy retirement, children having to go for study loans to fund their tertiary education because daddy doesn’t have enough money, etc. etc.).

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When can I consider myself financially free? Part 1
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