RM1.3 million in EPF: This is How Much You Need to Contribute Every Month.

Author

The Futurizts
June 01, 2025

By now, you should have seen (or at least heard of) EPF’s new retirement targets.

In December, they introduced a savings framework that quietly raised the retirement age from 55 to 60.

Called the Retirement Income Adequacy (RIA) framework, it aims to give Malaysians a monthly spending guide and help them plan for a more secure retirement.

The framework is split into three tiers, based on the figures from the Belanjawanku Guide.

EPF also published the savings required to hit each of these targets.

TLDR: If you’re 30, your EPF balance should fall into one of these categories:

  • Basic: RM38,000

  • Adequate: RM47,500

  • Enhanced: RM85,400

But how difficult is it to achieve these targets? And how much should you contribute every month?

Let’s say:

  • You start working at 24

  • Earn RM2,500 per month

  • Save RM400 per month and invest in EPF

You’ll hit RM1.3 million if by 60, even if you don’t receive any salary increments or bonuses.

Your total capital during these 36 years would be RM432,000, while the remaining RM929,817.32 is interest earned.

In other words, your capital would have more than tripled—every ringgit you contributed over the years compounded to RM3.

As for EPF’s other targets:

  • RM650,000 -> RM477 per month (can be achieved with RM2k salary)

  • RM390,000 -> RM286 per month (can be achieved with RM1.2k salary)

^ Assuming you start at 24, don’t save, no inflation, no salary increment, and EPF pays 5.50% per year.

What if I’m older?

You can refer to three tables I’ve prepared.

The first table shows the average EPF savings by age group as of December 2024. If your savings and contributions fall within (or above) this range, you’re on track to hit—or even exceed—RM1.3 million by age 60, even without salary increments.

Table 1: Monthly contributions to hit RM1.3 mil for each age group

The second table shows the average salary needed to reach EPF’s targets. The numbers may look high because I didn’t include manual savings (like your own investments), salary increases, or bonuses.

So, if your current salary is already within this range, you’ll definitely exceed RM1.3 million by 60.

Table 2: Salary to hit RM1.3 million without any savings, salary increment, bonuses and inflation.

The third table assumes you save 10% of your salary every month and invest it into EPF.

These salary estimates are much more realistic and about 50–60% lower than those in the second table.

Keep in mind, the numbers in tables (1) and (2) are average salary estimates. So don’t worry if your current pay is below them. Salary growth and bonuses over time will help you reach and even surpass the RM1.3 million mark.

Table 3: Salary to hit RM1.3 million by saving 10%, without salary increment, bonuses and inflation.

But what will RM1.3 mil be worth in 25 years?

With just 2.5% inflation per year, RM1.3 million today will grow to RM2.41 million in 25 years.

That’s the amount you might need to retire comfortably in the future. Don’t be surprised if EPF updates its targets to reflect this.

But as long as you’re getting a 3–5% salary increment each year, you’ll stay ahead of inflation—and likely surpass all of EPF’s savings goals.

What if RM1.3 million is not enough for me?

You can use the Rule of 25 to work out your “magic number” for retirement. But keep in mind — most people aged 60 to 80 don’t actually need that much money. By then, they’ve usually paid off their debts and no longer have big responsibilities.

Think about your grandparents. How much do they really spend each month?

Say you want RM10,000 per month during retirement, your target amount should be:

RM10,000 × 12 months × 25 years = RM3,000,000

To reach this amount, you can:

  • Save and invest aggressively

  • Increase your income (so your EPF contributions go up)

Or do a combination of both.

Watch How I’m Currently Investing for Retirement here.

Use the compound interest calculator and inflation calculator to simulate different scenarios.

Thanks for reading! I hope you learned something.

DISCLAIMER: The information contained in this newsletter is for informational and educational purposes only. Nothing herein shall be construed to be financial, legal, or tax advice. The opinions of this newsletter are solely that of the publisher.

Join our WhatsApp group for more!

You’ll receive financial updates - best FD rates, cash app comparisons, currency & market movements, travel hacks, etc. on a daily basis.

✅ 200+ people have joined.

✅ We don’t spam.

✅ It’s only $0.25/week.

Reply

or to participate.