Today I’m not going to talk about investment, but something equally important to us, which is Personal Financial Planning! According to EPF, as at March 2010, about as much as 74% of the EPF members have not made nomination to their EPF savings. Many EPF members are either not aware of the importance of nominating beneficiaries for their EPF savings or they are just too lazy to act! Hence, there’s an urgency for those who have not done it to act immediately!
Let me tell you the consequence of not having a nomination. First, the EPF savings will be termed ‘EPF savings without nomination’ after the demise of the EPF member. Then the EPF authority will disperse RM20,000 of the deceased money in two stages to the next of kin in 2 months time, and the balance will only be released upon the submission of Letter of Administration/ Grant of Probate/ Faraid Certificate which may take minimum 6 months or up to a maximum of 7 years. Imagine your love ones have to go through this tedious process, especially if you have schooling kids, it will be nightmares for them for not having enough money for education.
In addition, many EPF members did nominate beneficiaries but the names are not up to date. For example, they nominated their parents or their ex-girlfriends or boyfriends long time ago when they stepped into the workforce. There are cases whereby the nominees are no longer alive and the EPF savings will go to ‘EPF savings without nomination’. This is not too bad if you were to compare to other cases when the EPF savings went to the ex-lovers and your love ones will be left with nothing!
Act now! Either you want to do a nomination or an update, there is only one form to fill. Go to the nearest EPF office, complete Form KWSP 4 (AHL) and submit in person because they need to verify with your identification card.
If you’ve done this, congratulations! Your wise move will help prevent any dispute in claiming of the EPF money, and you have a peace of mind that your love ones will receive the payments promptly.