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Talk about efficiency. Thank you, JoMel!
By bigpumpkin | September 24, 2007
Since my last post about family insurance plans, the lovely JoMel has responded rather promptly and at length to my genuine query. Now I’m not so quick to commit myself into the Education/Insurance plan for Tee. But having said that, I do like the coverage for insurance that she’d get with it. I mean, you just never know……..
*brain wreck*
We already have several unit trust investments and our own whole life policies. Plus medical and personal accident.
So what next?
I really need to discuss this properly with the Hubs and work out some calculations. I wonder how much of his EPF money can be dumped into insurance or unit trusts. Can we purchase property or stocks with EPF money?
I am really a ‘dunggu’ when it comes to finances. As the Hubs will gladly share.
Topics: Pumpkin Thoughts, moolah, Design and Reviews, Old age, Wealth, Medical |
One Response to “Talk about efficiency. Thank you, JoMel!”
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September 25th, 2007 at 3:02 am
aiyah… you ask this kind of question, I wanna pretend not to see also cannot.
EPF money from Account 1, can be invested in Unit trust, but only for approved funds as determined by the EPF
EPF money from Account 2, can be withdrawn to pay the differential sum between your initial 10% deposit for your new home and the amt that you are lending from the bank. And according to the new Budget, with effect Jan 2008, you may withdraw money from Account 2 every month to pay your bank loan.
EPF money cannot be invested in the stock market.
With regards to investing in Unit Trust with EPF account 1, it is a very very very wise thing to do. In the past, EPF dividend comes up to about 5%. Sorry, if I am offending anyone here… but 5 freaking %????? I thought the money is also invested by EPF into different investment instruments, like Unit trusts?? Why only 5%!!!??? You can do better than that! Invest in Unit trust yourself! Afterall, there’s only a certain limit you are allowed to withdraw. Eg, if you have RM100K in account 1, RM50K cannot be touched. And of the remaining 50K, only 20% can be invested in the approved unit trust funds. Once every three months. Might as well do it right? Unless 5%, you are happy with.
With regards to using EPF account 2 to pay for home, fine. But if EPF is paying 5%, and mortgage interest is slightly higher than that, then you still have to pay from your own pocket. Unless, you manage to get those home loan whereby, you have fixed 2% or fixed 3% in the first or second year, then it’s great to withdraw from EPF account 2 during this time period. Ok, don’t know if this makes sense. I find this harder to explain anyway. Having said there, most people are quite strapped for cash and withdrawing from account 2 to pay for their home does ease a lot of the financial burden, and in this case, I would say go for it. But if you have the extra cash to pay for your home without withdrawing from EPF, better still.