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Unlocking the Potential of EPF Account 3: Flexibility, Diversification, and Strategic Savings

KWSP recently performed an EPF Account Restructuring Initiative that restructured members' accounts from two to three. This initiative aims to, and we quote

“enhance members’ retirement income security while addressing their current life cycle needs.”

Official KWSP Press release (source)
In a nutshell, the restructure increases the composition of funds flowing into members’ Account 1 (accessible only upon retirement) from 70% to 75%, while 10% now flow into Account 3, which can be accessed anytime (subject to a few criteria). This restructuring provides members the flexibility to withdraw funds to meet their current needs. For more details on the restructuring, click here. Join us as we unravel the mysteries surrounding EPF Account 3.

Understanding EPF Account 3

Understanding EPF Account 3 is crucial for individuals aiming to secure their financial future and achieve long-term financial stability. Often overlooked compared to Accounts 1 and 2, EPF Account 3 plays a vital role in diversifying retirement savings and providing additional financial security.

Key Benefits of EPF Account 3:

Diversification of Savings and Investments:
EPF Account 3 offers flexibility to diversify savings beyond traditional avenues like ASNB, bank deposits, and mutual funds. This helps optimize investment portfolios and distribute risk.

Flexibility and Control:
Members can make an initial lump sum transfer to Account 3 by August 24, 2024. Withdrawals can be made at any time, subject to account balance and minimum withdrawal amounts. This flexibility supports both short-term and long-term financial planning.

Supplementary Savings:
Account 3 serves as supplementary savings for education, homeownership, healthcare, and emergencies. Strategic use of these funds can provide a safety net during unforeseen circumstances, enhancing financial resilience.

Maximizing Benefits:
Understanding the intricacies of EPF Account 3 allows members to maximize benefits, optimize contributions, and leverage investment opportunities and tax advantages.


EPF Account 3 is a valuable tool for those striving towards financial freedom and long-term security. By diversifying savings, leveraging investment opportunities, and maximizing benefits, members can build a robust financial foundation. The flexibility offered by Account 3 supports various financial goals, from retirement planning to immediate financial needs like education and healthcare costs.

However, members must be cautious. Withdrawing from Account 3 reduces the overall EPF balance, potentially lowering annual dividends. Prudent financial management and strategic use of Account 3 funds are essential to avoid financial pitfalls.

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