CPF:
Your Assurance
in Retirement
1
Reaching
55
At 55, it’s time to make
your next move
CONTENTS
02
Introduction
03
Decisions to be made:
•
•
•
•
•
How much monthly payouts do you need during retirement?
How much can you withdraw at 55? How to withdraw?
Should you continue to save with CPF?
Should you join CPF LIFE?
Which CPF LIFE plan should you choose?
12
Top up for tax savings and earn higher interest
14
CPF beyond 55
16
Conclusion
17
Annex A – Case Studies
20
Annex B – CPF Investment Scheme and CPF Education Scheme
21
Glossary – Important Terms and Figures
23
Notes
The information in this publication applies to members turning 55
from 1 July 2015 to 31 December 2015.
1
Introduction
Remember
three key
points:
In the lead up to your retirement years, you may have questions about how your
CPF will provide for your retirement needs. When you reach the milestone age of
55 in your CPF journey, two events take place:
• A Retirement Account is created to set aside your retirement sum, which will
provide you with a monthly income in old age.
• You can withdraw a portion of your CPF savings if you so choose.
1
Make an
informed
decision on
your desired
payouts.
2
Join
CPF LIFE
to enjoy
lifelong
monthly
payouts.
3
TOP UP
your and your
loved ones’
retirement
savings.
2
While withdrawal is an option open to you, you should consider stretching the
value of your CPF savings by keeping it in your accounts so that there will be more
retirement savings in your golden years. Apart from the attractive interest rates
earned in your CPF accounts, you can make regular top-ups to your CPF to boost
your retirement savings. Let your total CPF savings count towards a proportion of
your overall retirement provisions.
Singaporeans are living longer. It is an increasing concern that present retirement
funds may not be enough to last throughout retirement. About half of Singaporeans
who are 65 years old today are expected to live beyond the age of 85 and a third
of them will live beyond 90 years old. Having an income throughout old age is
more important than ever. To ensure you have a monthly income for as long as
you live, you can use your Retirement Account savings to join the CPF Lifelong
Income For the Elderly (CPF LIFE) scheme.
How much monthly payouts do
you need during retirement?
When you turn 55 years old, we will create your Retirement Account and transfer
some of your CPF savings from your Special Account and/or Ordinary Account
into this account to form your retirement sum.
You can buy a CPF LIFE annuity using your retirement sum to receive lifelong
monthly payouts from your payout eligibility age, which is currently at age 65.
Depending on your desired CPF LIFE monthly payout and your CPF balances, you
can choose from a range of payout options that best suit your needs in retirement.
Your monthly
payout1
for life from 65
Retirement Account
savings
required at 55
If you own a property
and choose to pledge
your property.
$660 - $720
Basic Retirement Sum (BRS)
$80,500
If you do not own a
property or choose not
to pledge your property.
$1,220 - $1,320
Full Retirement Sum (FRS)
$161,000
The FRS is 2 x BRS.
If you wish to put more
savings in CPF LIFE.
$1,770 - $1,920
Enhanced Retirement
Sum (ERS)2
$241,500
The ERS is 3 x BRS.
To help you plan early for retirement, the Basic Retirement Sum will be made known
to you ahead of time. For each successive cohort of members turning 55, payouts
need to be higher to account for long term inflation and rising standards of living.
Correspondingly, the Basic Retirement Sum to be set aside has to increase.
BASIC
MONTHLY
PAYOUT1
FOR LIFE
FROM 65
Basic
Retirement
Sum
AGE 55
IN 2016
AGE 55
IN 2017
AGE 55
IN 2018
AGE 55
IN 2019
AGE 55
IN 2020
$660 $720
$680 $740
$700 $760
$720 $780
$740 $800
$80,500
$83,000
$85,500
$88,000
$90,500
1
Payouts are estimates based on CPF LIFE Standard Plan parameters in 2016.
2
Available from January 2016.
3
OA + S A+ M A
How much can you withdraw
at 55?
To calculate how much you can withdraw, you need to first work out your X and
Y as shown below.
X
Ordinary Account +
Special Account +
X = Medisave Account
savings above
$43,500
Y
Medisave Account
savings up to the
Y=
Medisave Minimum
Sum of $43,500
$43,500
Ordinary
Account
Special
Account
Medisave
Account
X
You can withdraw
What does this mean?
X < $5,000
X
You can withdraw all of
your X.
Y stays in your Medisave
Account.
$5,000 < X < $166,000
$5,000
If you have Retirement
Account savings above
the Basic Retirement
Sum of $80,500,
you can choose to
withdraw the amount
by pledging your
property.
X > $166,000
X - $161,000 - Medisave
Minimum Sum shortfall
If you have Retirement
Account savings above
the Basic Retirement
Sum of $80,500,
you can choose to
withdraw the amount
by pledging your
property.
4
You can withdraw $5,000
from your Ordinary and
Special Accounts. The
remainder will form your
retirement sum in your
Retirement Account.
Y stays in your Medisave
Account.
You can withdraw $5,000
and any excess CPF
savings after setting
aside the Full Retirement
Sum of $161,000 and
the current Medisave
Minimum Sum of $43,500.
Y stays in your Medisave
Account.
Here’s an example on how much a typical CPF member can withdraw. Ms Anita
has just turned 55. A Retirement Account is created on her 55th birthday. Ms Anita’s
X is between $5,000 and $166,000.
X = $45,000 + $55,000 = $100,000
Ms Anita can choose to withdraw $5,000 of her CPF savings from her Ordinary
and Special Accounts. The remaining amount of $95,000 will form her retirement
sum in her Retirement Account.
If she owns a property, she can choose to set aside her Basic Retirement Sum of
$80,500 in her Retirement Account to receive a monthly basic payout of $660 to
$720 from age 65 for life.
She can then withdraw $5,000 from her Ordinary and Special Accounts, and an
additional $14,500 from her Retirement Account by pledging her property.
5
How to withdraw?
You will receive a letter from us a few months before your 55th birthday. You can
apply to withdraw your CPF once you receive the letter or any time later.
Ways to apply for withdrawal
Option 1: Online application
Apply online at www.cpf.gov.sg. You will need your SingPass and a OCBC, POSB
or UOB account.
Option 2: Form application
Send us your application using the form (RWD-55) enclosed with the letter.
Complete the application form and mail to:
CPF Board
Retirement Withdrawals Department
79 Robinson Road
Singapore 068897
6
Ea rn
Attractive
Intere s t
Should you continue to save
with CPF?
Withdrawing your CPF savings once you turn 55 years old is not compulsory.
Tip 1 – You can still make a withdrawal later!
If you do not withdraw your CPF savings at 55 years old, you can still make a
withdrawal at a later date.
Also, you do not have to take out the full amount at one go. You can make a
partial withdrawal and save the remaining money for your next withdrawal. For
example, if you can withdraw $5,000, you can choose to withdraw $2,000 which
would leave you $3,000 for your next withdrawal.
Tip 2 – Earn attractive interest!
Your CPF savings can continue to grow with the attractive interest earned in
your accounts, if you choose not to make a withdrawal at 55 years old. Your CPF
accounts currently earn up to 5% interest per year3. Members with lower CPF
balances can earn up to 6% interest per year4.
Age 55 and above (NEW)
CPF Balances
Interest Rate5
First $30,000
6%
Next $30,000
5%
Amounts above $60,000
4%
Tip 3 – You can still use your Ordinary Account savings to pay
your housing loan!
If you need to continue using your Ordinary Account for your housing payments
after age 55, you may apply to set aside some Ordinary Account savings for this
purpose before they are transferred to your Retirement Account. However, this
means you will set aside a lower retirement sum.
3
Currently, your CPF savings in the Ordinary Account earn a guaranteed interest rate of 2.5% per year,
while savings in the Special, Medisave and Retirement Accounts earn guaranteed interest rates of 4%
per year. The first $60,000 of your combined CPF balances, of which up to $20,000 from your Ordinary
Account, earns an extra 1% interest per year. Combined balances refer to the total balances in your
Ordinary, Special, Medisave and Retirement Accounts, including the annuity premiums for CPF LIFE
less any payouts made.
4
With effect from January 2016, an additional extra interest of 1% per year will be given on the first
$30,000 of your combined CPF balances (for members aged 55 and above). This is on top of the
existing 1% extra interest on the first $60,000 of balance.
5
Based on prevailing interest rates on balances in Special, Medisave and Retirement Accounts.
Balances in Ordinary Account can earn up to 4.5% for members aged 55 and above.
7
Golden
Years
Should you join CPF LIFE?
With CPF LIFE, you will have the assurance of receiving monthly payouts from your
payout eligibility age for as long as you live.
You will be placed on CPF LIFE if you are a Singapore Citizen or Permanent Resident
born in 1958 or after, and have at least:
(i) $40,000 in your Retirement Account when you reach 55 years old; or
(ii) $60,000 in your Retirement Account when you reach 65 years old.
If you are not placed on CPF LIFE, you can apply to join CPF LIFE or remain
on the Retirement Sum Scheme, which provides you with a monthly payout
for about 20 years.
Choose your CPF LIFE plan
We will invite you to choose your CPF LIFE plan nearer to your payout eligibility age.
You can choose between:
• CPF LIFE Standard Plan; or
• CPF LIFE Basic Plan
Choose the plan that best meets your retirement needs. Each CPF LIFE plan
provides a different combination of trade-offs between the amount of monthly
payouts that you will receive and the bequest that you will leave for your
beneficiaries.
If you do not choose a plan before your 70th birthday, we will automatically
place you on the CPF LIFE Standard Plan. The CPF LIFE annuity premium will be
deducted from your Retirement Account at the point of policy issuance.
8
If you choose the CPF LIFE Standard Plan…
We will deduct the entire savings in your Retirement Account as the annuity
premium at the point of policy issuance. You are eligible to receive monthly
payouts from your payout eligibility age for as long as you live.
If you choose the CPF LIFE Basic Plan…
We will deduct a portion of your Retirement Account savings for the annuity
premium at the point of policy issuance.The actual amount deducted will depend
on your age and gender. We will inform you on the amount to be deducted when
your policy is issued. The rest of your Retirement Account savings will stay in your
Retirement Account.
You will receive monthly payouts from your Retirement Account until one month
before you reach 90 years old. Once you reach 90 years old, you will continue to
receive monthly payouts from the annuity fund for as long as you live.
I n f o r m a t i o n
B o x
From 1 January 2016, you will have more flexibility to plan for your retirement.
1. You have the option to start your payouts later, up to age 70. For each year
deferred, your monthly payouts permanently increase by about 6% - 7%.
example
Basic Retirement Sum at
55 years old: $80,500.
This grows to about $125,0006
at 65 years old.
Joins CPF LIFE with entire
Retirement Account balance.
Option A
Option B
Starts CPF LIFE
payout at
65 years old.
Defers payout
start age to
70 years old.
Monthly payout
for life of about
$660 - $7207.
Monthly payout
for life increases
to about
$885 - $9657.
2. If you turned 55 from 2013, you have the option to withdraw up to 20% of
your Retirement Account savings from 65 years old (includes the first $5,000
withdrawable from age 55).
6
Based on CPF interest rates of up to 6% per year for members aged 55 and above from 2016.
7
Payouts are estimates based on CPF LIFE Standard Plan parameters in 2016.
9
Receiving your CPF LIFE payout
We will pay the monthly payout in your bank account using Inter-Bank GIRO (IBG)
by the 4th working day of each month. If the IBG is unsuccessful because you have
closed your bank account, we will pay the payouts into your Ordinary Account.
Benefitting from CPF LIFE with the LIFE Bonus
You can receive a LIFE Bonus of between $1,450 and $2,600 if you are a Singapore
Citizen with at least $20,000 in your Retirement Account and have either:
(i) Been placed on CPF LIFE; or
(ii) Informed us before your 56th birthday on your decision to join CPF LIFE.
The LIFE Bonus will be paid into your Retirement Account to enhance your monthly
CPF LIFE payouts.
If you have less than $20,000 in your Retirement Account before your 56th
birthday, your LIFE Bonus will be proportionately reduced.The amount of LIFE Bonus
that you can receive depends on your annual Assessable Income (AI) and the
Annual Value (AV) of your home.
$9,600 or less
Between $9,600
and $13,000
$27,000 or less
$2,600
$2,100
Between $27,000
and $60,000
$2,100
$1,450
AI
AV of Property
The LIFE Bonus figures above are applicable to members turning 55 from 1 January 2015 to 31 December 2015.
For more information on the LIFE Bonus, please visit www.cpf.gov.sg.
I n f o r m a t i o n
B o x
What if I do not have $20,000 in my Retirement Account?
You or your loved ones can make a cash or CPF top-up to your Retirement
Account to make up this amount. (See page 12 for more details)
10
Leaving CPF LIFE
The CPF LIFE payouts will stop upon death and your beneficiaries will receive a
bequest (if any is due). Otherwise, once you have joined CPF LIFE, you can only
leave the scheme for the following reasons:
• You have a medical condition which causes you:
– To be permanently unfit for any employment;
– To have severely reduced life expectancy; or
– To be terminally ill.
• You are about to leave/have left Singapore and West Malaysia permanently
with no intention of returning for work or to live.
• You are a Malaysian Citizen and have left Singapore permanently to live in
West Malaysia.
• You are fully exempted from setting aside the retirement sum in your Retirement
Account because you are receiving a monthly pension/annuity payout.
Both the CPF LIFE Standard Plan and the CPF LIFE Basic Plan have a refund feature.
If you decide to leave your plan, you will receive a refund of the savings used
to join CPF LIFE minus any monthly payouts received. The refund is your unused
annuity premium. You may not receive a refund if we have already paid out all
your savings used to join CPF LIFE.
11
Top Up For
Tax
Savings
Top up for tax savings and
earn higher interest
If you can, it’s well worth adding more to your CPF. Top up to boost your or your
loved ones’ Special Account or Retirement Account savings. Topping up to the
Enhanced Retirement Sum (available from January 2016), a sum set at three
times the Basic Retirement Sum, gives you the opportunity to enjoy a higher
monthly payout.
Under the Retirement Sum Topping-Up Scheme, you can even get tax relief8 for
cash top-ups. The tax relief is up to $7,000 per year if you top up for yourself and
an extra $7,000 per year if you top up for your family members.
What are the criteria for cash and CPF top-ups?
You can do a cash top-up to your and your loved ones’ CPF accounts, up to the
current Full Retirement Sum.
You can also transfer your Ordinary Account savings to your loved ones’ CPF
accounts. You may do so after meeting the Full Retirement Sum you need to
set aside when you turn 55 with your net balances in the Ordinary, Special and
Retirement Accounts including amounts withdrawn for investments.
Amount of top-up that can be received
12
For recipients
below 55 years old
Current Full Retirement Sum –
Net Special Account Balance – Amounts
withdrawn from Special Account under the
CPF Investment Scheme (CPFIS-SA)
For recipients
55 years old
and above
Current Full Retirement Sum –
Retirement Account Savings9
8
Terms and conditions apply
9
Excludes interest earned since 55 years old, any government grants and monies withdrawn.
From 2016, you will have additional flexibility to transfer your CPF savings above
the Basic Retirement Sum to your spouse’s CPF account. With this, both you and
your spouse can enjoy the benefits of the extra interest paid on the first $60,000
of combined CPF savings. Refer to the example below.
Before spousal transfer…
At age 55, Mrs Tan
has $35,000 in her
Retirement Account.
At age 65, her Retirement
Account balance will have
grown to about $59,000 which
will provide her with monthly
payouts for about 20 years.
At age 55, Mr Tan
has $100,500 in his
Retirement Account.
At age 65, Mr Tan will be
placed on CPF LIFE with a
Retirement Account balance
of about $156,000.
After spousal transfer…
At age 65, Mrs Tan will be
placed on CPF LIFE with a
Retirement Account balance
of about $90,000.
Mrs Tan now has
$55,000 in her
Retirement Account
at age 55.
Transfers $20,000 to
Mrs Tan’s CPF account
At age 65, Mr Tan will be
placed on CPF LIFE with a
Retirement Account balance
of about $127,000.
Mr Tan now has
$80,500 in his
Retirement Account
at age 55.
After the spousal transfer, Mr and Mrs Tan would enjoy an additional $2,000 in
interest which would help them boost their retirement payouts. Mrs Tan will now
enjoy higher monthly payouts for life.
I n f o r m a t i o n
B o x
Learn how to top up online
Visit http://mycpf.cpf.gov.sg/Members/online-demo
13
Beyond
55
CPF beyond 55
If you decide to continue working, you and your employer will still contribute to
your CPF. However, do note that the contributions to your Ordinary Account will
reduce, and this may affect how you manage your housing loan payments. So,
try to pay off your housing loan by 55 years old!
The table below shows the CPF contribution rates for employees aged 50 to 65.
Employee’s age
(years)10
Employer
contribution
rates
(% of wages)11
Employee
contribution
rates
(% of wages)11
Total
contribution
rates
(% of wages)11
Above 50 to 55
17
(16 + 1)
20
(19 + 1)
37
(35 + 2)
Above 55 to 60
13
(12 + 1)
13
26
(25 + 1)
Above 60 to 65
9
(8.5 + 0.5)
7.5
16.5
(16 + 0.5)
If you continue to work and contribute to your CPF after 55 years old, you may top
up your Retirement Account using the new CPF contributions to help build up your
retirement savings12.You can also withdraw the excess if you have set aside your Full
Retirement Sum or Basic Retirement Sum with sufficient property charge/pledge.
Housing repayments
If you continue working after 55, your future Ordinary Account contributions can
also be used for your housing loans.
You can use your Retirement Account savings (excludes top-up monies, interest
earned, and any government grants received) above your Basic Retirement Sum
for your housing needs.
14
10
An employee will move to the next age group in the month after his 35th, 45th, 50th, 55th, 60th and
65th birthday.
11
Increases in the contribution rates, applicable from January 2016, are shown in bold.
12
It may then be used to buy an additional CPF LIFE annuity when you reach your payout eligibility age.
Insurance premiums
You can continue to use your Ordinary Account savings for insurance premiums
under the Home Protection Scheme (HPS)/ Dependants’ Protection Scheme
(DPS), after setting aside your retirement sum at age 55.
Sale of property
If you sell your property, you need to refund the CPF that was used to buy it and
the accrued interest13. If you had also withdrawn from your Retirement Account
by pledging your property, you need to refund the pledge amount as well. The
amount refunded will be used to build up your retirement savings. The balance
of the housing refunds will then be paid to you, after setting aside the current
Medisave Minimum Sum.
I n f o r m a t i o n
B o x
If you own an HDB flat, you can generate income from your flat for your
retirement needs.
You may:
• Move to a smaller flat or Studio Apartment and sign up for the Silver Housing
Bonus to get a cash bonus when you top up to your Retirement Account
• Sign up for the Enhanced Lease Buyback Scheme and top up your
Retirement Account to get a cash bonus
• Rent out your whole flat or room(s)
If you have any questions, please call HDB’s toll-free hotline at 1800-555-6363,
or visit www.hdb.gov.sg/retirement
The above is subject to the eligibility conditions under HDB’s prevailing policies.
This is the interest you would have earned had you not withdrawn your CPF savings for the property.
13
15
Conclusion
Now that you have had the opportunity to consider your CPF planning, remember
three points:
Make an informed decision on your desired payouts.
Join CPF LIFE to enjoy lifelong monthly payouts.
Top up your and your loved ones’ retirement savings.
16
How much can you withdraw?
Annex A
Let’s meet Ms Anita’s friends: Mr Ahmad, Mr
Ravi, and Mdm Polly. They have different Xs and
Medisave savings in their CPF accounts at 55.
Introducing Ms Anita & Friends . . .
Let’s start with Mr Ahmad.
Mr Ahmad’s X is more than $166,000.
His Medisave Account has $43,500.
M r A h m a d ’s C P F S a v i n g s
Medisave Account
Mr Ahmad
Assume Mr Ahmad has:
$200,000
$43,500
Mr Ravi
Ms Anita
Mdm
Polly
Retirement
Account will
be created
on his 55th
birthday
$100,000
$43,500
$5,000
$166,000
X
Ordinary
Account
Special
Account
Medisave
Account
Retirement
Account
Retirement Account Savings
How much can Mr Ahmad withdraw?
X = $100,000 + $200,000 = $300,000
Mr Ahmad can choose to leave his Full Retirement Sum of
$161,000 in his Retirement Account to receive a monthly
payout of $1,220 to $1,320 from age 65 for life.
$161,000 will be transferred to his Retirement Account first.
$161,000
He can then withdraw the balance of $139,000 from his
Ordinary and Special Accounts, as he has set aside his
Full Retirement Sum of $161,000 and the current Medisave
Minimum Sum of $43,500.
$100,000
If he owns a property, he can also choose to set aside his
Basic Retirement Sum of $80,500 in his Retirement Account
and receive a lower monthly payout.
$43,500
$39,000
Ordinary
Account
Special
Account
Medisave
Account
Retirement
Account
In this case, he can withdraw $139,000 from his Ordinary
and Special Accounts, and an additional $80,500 from his
Retirement Account by pledging his property.
17
How much can you withdraw?
Annex A
How about Mdm Polly?
Mdm Polly’s X is more than $166,000. However, Mdm Polly’s
Medisave Account has less than $43,500.
She has an Medisave Minimum Sum shortfall.
M d m P o l l y ’s C P F S a v i n g s
Retirement Account Savings
Assume Mdm Polly has:
X = $100,000 + $180,000 = $280,000
$161,000 will be transferred to her
Retirement Account first.
$180,000
$161,000
$100,000
RA will be
created
on her 55th
birthday
$100,000
$20,000
Ordinary
Account
Special
Account
Medisave
Account
Retirement
Account
Ordinary
Account
$19,000
$20,000
Special
Account
Medisave
Account
Retirement
Account
Medisave Minimum Sum Shor tfall
How much can Mdm Polly withdraw?
Mdm Polly’s Medisave Account has $20,000. This is $23,500
Mdm Polly can choose to leave her Full Retirement Sum of
$161,000 in her Retirement Account to receive a monthly
payout of $1,220 to $1,320 from age 65 for life.
short of the Medisave Minimum Sum of $43,500. Therefore,
$23,500 is transferred to her Medisave Account.
$155,000
She can then withdraw the balance from her Ordinary and
Special Accounts after transferring $23,500 to Medisave
Account to make up the Medisave Minimum Sum of
$43,500. This means that Mdm Polly can withdraw $95,500
from her Ordinary and Special Accounts.
$23,500 is
transferred to
Medisave Account
$95,500
If she owns a property, she can also choose to set aside
her Basic Retirement Sum of $80,500 in her Retirement
Account and receive a lower monthly payout.
$43,500
$0
Ordinary
Account
18
Special
Account
Medisave
Account
Retirement
Account
In this case, she can withdraw $95,500 from her Ordinary
Account, and an additional $80,500 from her Retirement
Account by pledging her property.
How much can you withdraw?
Annex A
How about Mr Ravi?
Mr Ravi’s X is between $0 to $5,000. He can withdraw all of his X.
M r R a v i ’s C P F S a v i n g s
How much can he withdraw?
Assume Mr Ravi has:
X = $3,000 + $1,000 = $4,000
Mr Ravi can withdraw all of his Ordinary and Special
Accounts savings (i.e. $4,000) and nothing will be
transferred to his Retirement Account.
RA will be
created
on his 55th
birthday
The $500 will remain in his Medisave Account for his or
his dependants’ healthcare needs.
$4,000
$3,000
$1,000
$500
Ordinary
Account
Special
Account
Medisave
Account
$500
Retirement
Account
Ordinary
Account
Special
Account
Medisave
Account
Retirement
Account
Bank
Account
19
Annex B
Guide on decisions and actions you need to make on
the CPF Investment Scheme (CPFIS) and CPF Education
Scheme matters when you reach 55.
When you want to withdraw your CPFIS and Special Discounted Shares (SDS)
investments, or apply for waiver of the education loan repayment
What
If you have
set aside
your Full
Retirement
Sum or
Basic
Retirement
Sum with
sufficient
property
charge/
pledge
How
Upon successful application
Investments
Investments
Apply online through ‘My Request’
from the CPF website or complete
form INV-Transfer.
CPFIS-Ordinary Account (CPFIS-OA)
We will inform your agent bank to close your CPF
Investment Account. You may approach the bank for
the withdrawal of your investments and cash after we
have notified you. Your investments will be transferred
to your name. You can then liquidate them if you wish
and have the money made from the sale paid to you
directly.
Education
Apply online through ‘My Request’
from the CPF website or complete
form AES W1.
CPFIS-Special Account (CPFIS-SA)
We will inform your product provider(s) to transfer your
investments to your name. You can then liquidate them
if you wish and have the money made from the sale paid
to you directly.
Special Discounted Shares (SDS)
We will transfer your SDS to your Central Depository (CDP)
Securities Account.
If you
have not
set aside
your Full
Retirement
Sum or
Basic
Retirement
Sum with
sufficient
property
charge/
pledge
Investments
Service standards:
Top up your Retirement
Account/Medisave Account
to meet your Full Retirement
Sum and/or the current
Medisave Minimum Sum
before you can withdraw your
CPFIS investments and SDS
investments.
CPFIS-OA & SA
• Form application
We will notify your agent banks and product providers
within three working days from the day we receive your
application. After that, agent banks and product providers
will liaise with you to get more information for the release.
• Online application
One working day
Education
Top up your Retirement
Account/Medisave Account
to meet your Full Retirement
Sum and/or the current
Medisave Minimum Sum
before you can apply for
waiver of the education loan.
SDS
• Form or online application
Within 15 working days from the day we receive your
application and CDP transfer free (this includes CDP’s
processing time).
Education
• Form application
14 working days
• Online application
Up to two working days
Up to eight working days if the application is submitted
during the monthly Inter-Bank GIRO (IBG) deduction
period, which typically takes place from the 15 th to
23 rd of each month. This is to take into account the
bank’s processing time for monthly deductions from
students’ IBG accounts.
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Glossary
Term
Definition
Retirement Sum
Basic Retirement
Sum (BRS)
The retirement sum to set aside at age 55 to receive a monthly CPF LIFE payout
of about $660 - $720 from payout eligibility age. This sum is set at $80,500 for
members who turn 55 between July 2015 and December 2016. This assumes that
the member owns a property and does not need to pay rent.
Full Retirement
Sum (FRS)
The retirement sum to set aside at age 55 to receive a monthly CPF LIFE payout of
about $1,220 - $1,320 from payout eligibility age. It is set at two times the Basic
Retirement Sum (i.e. $161,000 for members who turn 55 between July 2015 and
December 2016). This assumes that the member does not own a property or does
not wish to pledge their property.
Enhanced
Retirement
Sum (ERS)
– available from
January 2016
The retirement sum to set aside at age 55 to receive a monthly CPF LIFE payout of
about $1,770 - $1,920 from payout eligibility age. It is set at three times the Basic
Retirement Sum (i.e. $241,500 in 2016). CPF members who want to have higher
monthly payouts can top up their Retirement Account to this amount.
Payout Age
Payout Eligibility
Age (PEA)
Formerly known as the drawdown age. It has been renamed to differentiate it
from the payout start age (see below). This is the age at which CPF members are
eligible to receive CPF payouts. It is currently at age 65 years old for members who
are born in 1954 or later.
Payout Start Age
(PSA)
This is the age at which CPF members have chosen to start their payouts. For
members under the CPF LIFE scheme, they can choose to start their payouts anytime
between age 65 to 70. For each year deferred, monthly payouts will permanently
increase by 6 to 7 per cent for members under the CPF LIFE scheme.
Other Terms
Annuity
An annuity is an insurance product which provides you with a monthly income for
the rest of your life.
Annuity Fund/
Lifelong Income
Fund
The annuity fund, also known as the Lifelong Income Fund, consists of the annuity
premium, the interest earned on the annuity premium and the extra interest earned
by members on the CPF LIFE Standard Plan.
Annuity Premium
The annuity premium is the amount of your Retirement Account savings committed
to CPF LIFE.
Assessable Income
(AI)
Your AI refers to your total annual income less approved deductions.
To work out your AI, we will use the assessment year before the year that we issue
your CPF LIFE plan, as provided by IRAS.
For example, if we issue your CPF LIFE plan in 2015, we will use your AI for assessment
year 2014 (that is, your income for 2013).
21
Glossary
Term
Definition
Other Terms
Annual Value (AV)
The AV of your property refers to how much rent we estimate you could receive
each year if you rented it out.
To work out the value of your property, we will use the AV of the property stated as
your NRIC address as at 31 December before the year we issue your CPF LIFE plan,
as provided by IRAS.
For example, if we issue your CPF LIFE plan in 2015, we will use the 2014 AV of the
property stated in your NRIC as of 31 December 2014.
Beneficiaries
Beneficiaries are the people who you have nominated to receive your CPF savings
after your death. If a CPF nomination is not made, upon death, your CPF savings
will be distributed by the Public Trustee in accordance to the intestacy laws of
Singapore, which ensures that the welfare of your dependants are provided for.
Bequest
A bequest is the money that you leave to your beneficiaries after your death. There
may not be a bequest if the savings used to join CPF LIFE have been fully paid out
in monthly payouts.
Medisave Minimum
Sum (MMS)
When you make a withdrawal from your CPF after 55, you will be required to set
aside the Medisave Minimum Sum of $43,500 in your Medisave Account for your
healthcare needs.
From January 2016, the MMS will be removed. You will no longer be required to top
up your Medisave Account before making a CPF withdrawal at 55.
Your Medisave Account savings will remain in your Medisave Account and can be
used to pay for your or your dependants’ healthcare needs.
In view of this upcoming change, from now till 31 December 2015, you have the
option to not top up to your Medisave Account when you withdraw your CPF monies.
Medisave Minimum
Sum (MMS)
Shortfall
You will have a Medisave Minimum Sum shortfall if your Medisave Account balance
falls below the Medisave Minimum Sum of $43,500. You will be required to top up
the shortfall with a portion of your Special and/or Ordinary Account savings only
after you have met the Full Retirement Sum.
Property Charge
A charge is created when a member uses his CPF savings to finance the purchase
of his property and pay his housing loan.
Property Pledge
CPF members can withdraw their Retirement Account savings 14 above the Basic
Retirement Sum in cash if they pledge their property. Pledging a property means
that when a person sells his property, the amount pledged will go back to his
Retirement Account. It does not affect one’s ownership of the property.
14
22
Excludes top-up monies, interest earned and any government grants received
Notes
23
Notes
24
www.cpf.gov.sg
Information is accurate as of 24 April 2015