From 2013, CPF members born in 1958 or later with at least $40,000 in their Retirement Account (RA) at age 55 will be automatically included in CPF LIFE. Those with less than $40,000 will not be automatically included at 55. However, such members will be automatically included at DDA if they have $60,000 in their RA then. This $60,000 is equivalent in value to $40,000 at age 55, compounded at 4% over 10 years.
CPF SA Amount for Investment
From 1 July 2010, the first $40,000 of members’ Special Account balances will no longer be allowed to be used for investments. There is no change to the requirement for members to set aside $20,000 in the Ordinary Account before they can invest their Ordinary Account monies. This move is to ensure that CPF members has the $60,000 when they reach 55 years old to receive reasonable monthly payout.
Refining CPF Nomination Rules
From January 2011, CPF members will be allowed to transfer their CPF monies to their nominees’ CPF accounts upon their demise. This will better provide for the retirement and healthcare adequacies of their nominees. CPF Board will release more details at a later date.
Allowing Payout Adjustments for Minimum Sum Scheme
From July 2010, members can now apply for an upward adjustment in their CPF monthly income provided that their adjusted payouts can last at least 20 years from their Draw Down Age, or at least another 5 years from the time of application, whichever ends later. This option is applicable to both MS top-up recipients and older members with large balances in their Retirement Accounts.
Example of Minimum Sum Payout Adjustment: Member aged 64 in July 2010
|Cohort Draw Down Age||62|
|Retirement Account cash balance||$95,000|
|Top-up amount in July 2010||$22,000|
|Retirement Account cash balance after top-up||$117,000|
|Under Current Top-Up Rules|
|Estimated payout end age||96|
|If Member Opts for Upward Payout Adjustment|
|Increment in payout||$217|
|Estimated payout end age||82|
* This is the maximum payout for this member’s cohort under current top-up rules