EPF’s 4.5% Dividend – Your Cheese Eaten by ValueCap?
Nobody likes to hear that their hard-earned money “invested” in EPF is earning pathetic dividend. I mentioned the word invested because your money was “forced” out from your pocket before you can even smell the aroma of the money and both of you (money and you) were cruelly separated on the same day you received your pay-slip.
It’s another way to say that your money is working for you (does that make you feel better?) so that when you retire you won’t die a hungry ghost *really?*. And EPF is your custodian because it was deemed that all of you do not have the discipline in saving, let alone the knowledge to grow your money. So it was fair that the caring EPF took the huge burden of this responsibility. And we should be grateful to EPF because they know best on how to invest your money *grin*.
And so the EPF was performing exceptionally well from 1950s to 1980s – the highest dividend ever declared was 8.50% in the golden period of 1983 till 1987. Thereafter the dividend yield has been plunging from the roof. In fact the great era of dividend was fast losing its shine after the 1993 Super Bull-Run. We may never experience the 1993 Super Bull-Run again in many decades to come. Heck, the country has never recovered to the pre-1997 Asia Economic Crisis even until today and we’re already entering the recession again of which our politicians were saying otherwise. Did you notice how the Second Finance Minister Nor Yakcop panicked when asked by reporter about the rumor that EPF was about to declare dividend of only 4.5%? He was almost speechless and was mumbling directionless.
