As the curtains draw on 2025, most of us are clearing out our inboxes and preparing for the holiday season. But for a professional in Malaysia, December 2025 is more than just a countdown to the New Year—it is the final window to prepare for a massive shift in our national financial landscape.
From January 1, 2026, new frameworks in healthcare and retirement will officially take effect. If you haven’t looked at your portfolio since your last birthday, you might find yourself navigating the new year with an outdated “map.”
Here is your 15-minute guide to auditing your two most important pillars before the clock strikes midnight.
1. The Medical Card Audit: Bracing for the 16% Surge
The most urgent update for 2026 is the cost of care. Leading industry reports, including the Aon 2026 Global Medical Trend Rates Report, project that medical inflation in Malaysia will hit 16% in 2026.
This isn’t just a small bump; it’s the highest rate we’ve seen in a decade, significantly outstripping the Asia-Pacific average of 11.3%.
Why this matters for your audit: If your medical card has a “plateaued” annual limit (e.g., RM100,000 to RM150,000), you are entering a high-risk zone. While 99% of claims historically fall under RM55,000, the 16% inflation rate means the cost of treating complex conditions—like respiratory or cardiovascular issues—is moving the goalposts.
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The Check: Look at your “Annual Limit.” With the BNM RESET strategy rolling out in 2026, ensure your plan isn’t just “active,” but “sustainable.”
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The Action: If your premiums are due for a hike in 2026 (as many moratoriums end), consult with me to see if you should transition to the new Base MHIT plans or upgrade your existing limits to future-proof against these rising costs.
2. The EPF & RIA Audit: Know Your New Tiers
Starting January 1, 2026, the Employees Provident Fund (EPF) is officially operationalizing the Retirement Income Adequacy (RIA) Framework. We are moving away from a single “Basic Savings” target to a sophisticated three-tier system designed to reflect your actual lifestyle aspirations.
The New 2026 RIA Savings Benchmarks (Target at Age 60):
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Basic Savings (RM390,000): This first tier is designed to cover bare necessities. It supports estimated monthly withdrawals of RM1,625 in the first year of retirement, projected to increase to roughly RM4,434 by the 20th year. To allow for a smooth transition, this target will be reached gradually, starting at RM290,000 in 2026 and increasing annually until it hits the full amount in 2028.
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Adequate Savings (RM650,000): The second tier is benchmarked against the Belanjawanku guide for a single elderly person in the Klang Valley, which estimates a monthly requirement of approximately RM2,690 for a reasonable standard of living. At this level, retirees can expect to withdraw about RM2,708 monthly in their first year of retirement, with that amount potentially growing to over RM7,389 by year 20.
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Enhanced Savings (RM1.3 million): The final tier is set at double the “Adequate” level to support greater financial security, independence, and a higher quality of life. This tier enables initial monthly withdrawals of approximately RM5,417, which could increase to about RM14,779 by the end of a 20-year retirement period.
Source: EPF Policy and Product Enhancements 2026
Why this matters for your audit:
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Investment Eligibility: From 2026, you must hit the RM390,000 (Basic Savings) threshold before you are allowed to invest your EPF funds into Unit Trusts via the Members’ Investment Scheme (MIS).
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The “Millionaire” Shift: If you are under 55 with savings above RM1 million, your withdrawal threshold is increasing to RM1.1 million in 2026. This encourages more funds to remain invested to fight inflation.
3. The PRS & Tax Audit: The December Deadline
While you’re checking your EPF tiers, don’t forget the Private Retirement Scheme (PRS). Under Budget 2026, the government has extended the RM3,000 tax relief for PRS contributions through the year 2030.
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The Check: Have you contributed the full RM3,000 for 2025? If not, you have until December 31st to lower your taxable income.
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The 2026 Strategy: As EPF tightens its investment rules (requiring RM390k for MIS), PRS becomes an even more critical tool for professionals to voluntarily “boost” their retirement growth in high-value sectors like AI and Green Energy.
The Final Step: From Surviving to Thriving
As your financial partner, I want to see you enter 2026 with confidence, not just “compliance.” The data is clear: medical costs are rising, and the government is raising the bar for retirement “adequacy.”
Your December “To-Do” List:
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Check your Medical Limit against the 16% inflation forecast.
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Audit your EPF balance against the new RIA Tiers (Basic: RM390k, Adequate: RM650k, Enhanced: RM1.3m).
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Top up your PRS to hit that RM3,000 tax relief cap before December 31.
Let’s sit down for a quick year-end review. I can help you crunch these numbers and ensure your plan is ready to thrive in the new 2026 landscape.
