Your EPF account 2 can be used for property purchase either via a lump sum withdrawal or via monthly withdrawal for payments towards your mortgage. However, in view of the recent good dividend payments by EPF and cheap loans available, it makes more sense to keep your EPF intact.

The dividend declared by EPF for 2007 was 5.8%. Compared that with housing loan interests which at the moment is as good as BLR – 2.2% (EON Bank Print Media advertisements). So the current BLR is 6.75% and minusing 2.2%, you get 4.55%. Then you take 5.8% and subtract that with 4.55% you get 1.25%. Doesn’t sound like much you say? Well, for a RM300K loan, you will save RM3,750 per annum or translated to a savings of more than RM300 per month. Now, isn’t that a lot? The money saved could be used to buy a new car even.

So a lot of people who do not do their homework, will withdraw from Account 2 and end up “losing” some savings.

I hope you find the above tip useful. I am thinking about revamping this blog where I offer to provide different financial scenarios as case study. So if you have any queries, feel free to leave me a comment, I will strive to answer them to my best of abilities.

I always emphasise that it is important for a business person to have integrity. If you are going into a business where you need to play dirty, I rather make a quick exit and concentrate on other businesses where it would bring better margins and better playing field.

In one of the industry where I was involved (technically I am still involved as the company is still on going though I have let it survive on its own for the last 18 months). I used to control the southern region market for a particular product which most of you are likely to have in your house or office. But some overzealous sales people decided to cut me out and proceed directly with some of my dealers and hence I saw that a price war is looming. So I made a quick exit and decided to watch from sideline. Sure enough the price for that product fell dramatically.

I was advised by some seniors in that principal to remain in the sideline until things becomes favourable. So much so that things are starting to look up again and the principals in USA decided enough is enough and wants to clean up the market a bit. Here I am back on the drawing table to prepare for my next round of battle.

I always believe if you have integrity in what you do and that you are keen to develop market rather than destroy it, your principals will always return to you and give you the product which everyone wants to buy. What product it is? hahaha.. those bloggers that knows me will know what it is.. for others.. stay tune for clues ;-)