6 - 8jan2018 talk managing cpf money for your retirement ... ·

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1Information is correct as at 8 Jan 2018

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INSTITUTE FOR FINANCIAL LITERACY

A collaboration between MoneySENSE, the national financial education

programme, and Singapore Polytechnic

We conduct free and unbiased financial talks/workshops at workplace and

public venues

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Full Term Acronym Full Term Acronym

Ordinary Account OARetirement Sum Topping-Up

RSTU

Special Account SA Voluntary Contribution VC

Medisave Account MA CPF Lifelong Income For the Elderly CPF LIFE

Retirement Account RA Retirement Sum Scheme RSS

Basic Retirement Sum BRS Payout eligibility age PEA

Full Retirement Sum FRS Payout start age PSA

Enhanced RetirementSum

ERS CPF Investment Scheme CPFIS

Basic Healthcare Sum BHSLifetime Retirement Investment Scheme

LRIS

Glossary

#1 How does CPF prepares

you for retirement?

#2 How much do you want your pay

cheque to be?

#3 A cheque book that never stops

paying

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Healthcare needs

Home ownership

Retirement income

Copyright © 2017 Central Provident Fund Board. All rights reserved. Reproduction without prior written consent by Central Provident Fund Board is strictly prohibited. Information is accurate as at January 2017.

HOW TO BE

READY


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Preparing You for RetirementAccumulate CPF

contributions as you work

Self Employer

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Earn risk-free interest on your CPF savings2Over time, your CPF savings will grow with the power of compound interest

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Join CPF LIFE to receive monthly payouts for as long

as you live

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Based on salary ceiling of $6,000. If you decide to continue working after 55 years old, your CPF contributions will still be allocated into OSMA.

CPF Contribution Rates

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CPF Accounts Ordinary Account

(OA)Up to

3.5% p.a.Primarily

for housing needs

Special Account

(SA)Up to

5% p.a.For our

retirement needs

Medisave Account

(MA)Up to

5% p.a.For our medical needs

Retirement Account (RA)

Up to 5% p.a.Provides

retirement payouts

Your OA savings earn interest rates of 2.5% per year. Your SA and MA savings earn interest rates of 4% per year.An extra interest of 1% is paid on the first $60,000 of your combined balances, of which up to $20,000 comes from the OA.

OA*(up to first $20,000)

SA MA

Up to 5%

Balance Savings

*The additional extra interest of 1% and extra interest of 1% earned on OA savings will be credited into the Special Account/ Retirement Account (depending on the member’s age).

(for those aged below 55)First $60,000

SMA: 4%OA: 2.5%

CPF Interest Rates

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RAOA*

(up to first $20,000)

SA MA

Up to 5% Next $30,000

SMRA: 4%OA: 2.5% Balance Savings

*The additional extra interest of 1% and extra interest of 1% earned on OA savings will be credited into the Special Account/ Retirement Account (depending on the member’s age).

Up to 6% First $30,000(for those aged 55 and above)

CPF Interest Rates

Power of Compound Interest

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#2


How much do you want your pay cheque to be?

How much do you need per month in retirement?

CPF LIFE PayoutsCPF LIFE Payouts

When do you want to retire? How long do you want the

payout to last?What is the interest rate on my

savings/investment? How much is the payout?

Payouts start from age 65 Payouts last for life Up to 6% per year $120,000 at age 55 to get

~$1,000 per month for life

Cash sourcesCash sources

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Your Retirement Account

Retirement AccountOrdinary &

Special Accounts

First $5k*

Savings up to FRS**

Excess Savings

**Full Retirement Sum ($171,000 for members turning 55 in 2018).

*Excludes top-up monies, interest earned, and any government grants received.

Your Monthly Retirement Payout

55 years old 65 years old

Monthly CPF LIFE Payout

Retirement Account

Savings up to FRS*

*Full Retirement Sum ($171,000 for members turning 55 in 2018).

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$85,500 (Basic Retirement Sum)

$720 - $770* (with property)

$1,320 - $1,410*

$1,910 - $2,060*

$171,000 (Full Retirement Sum)

$256,500 (Enhanced Retirement Sum)

Retirement Account Savings: Monthly CPF LIFE Payout:

x2 of BRS x3 of BRS

*Based on CPF LIFE Standard Plan payouts computed as of 2018.



$85,500 (Basic Retirement Sum)$720 - $770* (with

property)

$1,320 - $1,410*

$1,910 - $2,060*

$171,000 (Full Retirement Sum)

$256,500 (Enhanced Retirement Sum)

Retirement Account Savings: Monthly CPF LIFE Payout:

$120,000 $960 - $1,030*

Set aside the BRS* to

withdraw more savings

(lower payouts)

# Based on CPF LIFE Standard Plan payouts computed as of 2018.

* Exclude top-up monies, interest earned in RA and any government grants received.

Top up for higher payouts

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When do you need to pledge your property?Withdraw your desired amount of savings above BRS from Retirement Account (lower retirement payouts)

$120,000If no withdrawal above BRS was

made

$960 – $1,030#

$720 – $770#

BRS of $85,500If a withdrawal

above BRS was made

Withdraw $34,500*

Note: Pledging will not affect property ownership.

Principal + Interest (P+I)

FRS of $171,000

(if no property)

No pledge

required

# Based on CPF LIFE Standard Plan payouts computed as of 2018.* Exclude top-up monies, interest earned in RA and any government grants received.

When do you need to pledge your property?Withdraw your desired amount of savings above BRS from Retirement Account (lower retirement payouts)

$120,000If no withdrawal above BRS was

made

$960 – $1,030#

$720 – $770#

BRS of $85,500If a withdrawal

above BRS was made

Withdraw $34,500*

Property Pledge

Principal + Interest (P+I)Note: Pledging will not affect

property ownership.

FRS of $171,000

(if no property)

# Based on CPF LIFE Standard Plan payouts computed as of 2018.

* Exclude top-up monies, interest earned in RA and any government grants received.

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If you had used your

CPF to buy a

property

Refund:

• property charge

(principal amount

withdrawn for the property plus accrued

interest)

• pledge amount (if any)

Used to help you set aside your FRS

in the Retirement

Account

Balance of the

housing refunds will be paid to

you

Note: If your proceeds are insufficient to make up the amount you have withdrawn, the accrued interest and pledge amount (if any), you do not have to refund the difference in cash.

Can subsequently use Ordinary Account savings and Retirement Account savings (excludes top-up monies, interest earned and any government grants received) above BRS to finance next property purchase.


Sale of Property after 55

Know Your Options Ahead of Time

*Based on CPF LIFE Standard Plan payouts computed as of 2018.

Full Retirement Sum (FRS)

Enhanced Retirement Sum (ERS)

Basic Retirement Sum (BRS)

$80,500 $83,000 $85,500 $88,000 $90,500

$161,000 $166,000 $171,000 $176,000 $181,000

$241,500 $249,000 $256,500 $264,000 $271,500

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Born on or after

55th birthdayon or after

Age in 2017

Basic Retirement Sum (with property)

Full Retirement Sum

1 Jul 1948 1 Jul 2003 70 $40,000 $80,0001 Jul 1949 1 Jul 2004 69 $42,250 $84,5001 Jul 1950 1 Jul 2005 68 $45,000 $90,0001 Jul 1951 1 Jul 2006 67 $47,300 $94,6001 Jul 1952 1 Jul 2007 66 $49,800 $99,6001 Jul 1953 1 Jul 2008 65 $53,000 $106,0001 Jul 1954 1 Jul 2009 64 $58,500 $117,0001 Jul 1955 1 Jul 2010 63 $61,500 $123,0001 Jul 1956 1 Jul 2011 62 $65,500 $131,0001 Jul 1957 1 Jul 2012 61 $69,500 $139,0001 Jul 1958 1 Jul 2013 60 $74,000 $148,0001 Jul 1959 1 Jul 2014 59 $77,500 $155,0001 Jul 1960 1 Jul 2015 57 or 58 $80,500 $161,0001 Jan 1962 1 Jan 2017 56 $83,000 $166,0001 Jan 1963 1 Jan 2018 55 $85,500 $171,000

What are the Applicable Retirement Sums?

Topping-Up Options

You

Loved Ones#CPF Transfer

**Excludes any top-up monies, interest earned, and government grants.#Loved ones include your parents, parents-in-law, grandparents, grandparents-in-law, and siblings

CPF Transfer (savings above BRS)**

Spouse

CPF Transfer (savings above FRS)**

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New! CPF Transfers to Parents and

Grandparents

Giver age below 55 Giver age 55 and above*Current*Net OA savings above

current FRS

*New*Net OA

savings above current BRS(If OA+ SA+

property charge more than

current FRS)

*Current*Net OA savingsabove

cohort FRS

*New*Net OA, SA, RA savings above

cohort BRS(If OA+ SA+ RA+

property charge/pledge

more than cohort FRS

From Q4 2018, members can transfer savings above BRS (previously FRS) with sufficient property charge/pledge to their parents and/or grandparents to boost their retirement savings.

Topping-Up Options

You

Loved Ones#

*Cash top-ups within the current FRS are eligible for up to $7,000 of tax relief.#Loved ones include your parents, parents-in-law, grandparents, grandparents-in-law, and siblings.

SpouseCash Top-up

to SA/RA*

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Top-up Monies are Meant for Retirement

Top-up monies are set aside specifically for retirement income needs.

Will be used to increase the recipient's payout level and/or payout duration.

Cannot be used for other purposes such as education, investment, insurance premium payments, housing, withdrawn via a property with sufficient CPF property charge or pledge, CPF transfers, and/or exemption.

How do I make a top-up?CPF Transfers Cash Top-ups

CPF Website using SingPass

Hardcopy Form

AXS

E-Cashier

For more info:cpf.gov.sg/Members/Schemes/schemes/retirement/retirement-sum-topping-up-scheme

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#3A pay cheque that never

stops paying


CPF LIFE

Year of birth Payout eligibility age (PEA)

1943 and before 60

1944 to 1949 62

1950 to 1951 63

1952 to 1953 64

1954 and after 65

An annuity that will povide a monthly payout from your payout start age, for as long as you live. You can choose to start your payoutfrom your payout eligibility age.

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55 years old 65 years old 70 years old

Automatically placed on CPF LIFE

Standard Plan if you do not choose one

Lifelong monthly payouts

Set aside your

retirement sum

Placed on CPF LIFE 6 months

before, if you have $60,000

in Retirement Account*

For CPF members reaching 55 from 1May 2016 onwards

Choose your CPF LIFE plan only

when you want to start your payouts

*If you are not placed on CPF LIFE, you can apply to join anytime between your payout eligibility age and before you turn 80 years old, or remain on the Retirement Sum Scheme.

Who will be placed on CPF LIFE?

CPF LIFE Plans

*As with all CPF LIFE plans, payouts may be adjusted to account for long-term changes in interest rates or life expectancy. Such adjustments (if any) are expected to be small and gradual.

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Calculate your LIFE payout and bequest

using the CPF LIFE Payout Estimator

Click on Tools

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Click on CPF LIFE Payout Estimator

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Visit www.cpf.gov.sg

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Read the disclaimer and check the disclaimer box

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Input informationClick “Next”

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Input your desired payout start age and Click “Compute”

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Option for Higher Payouts

65 70

$1,410* per month

$1,880* per

month

For each year deferred, your CPF LIFE monthly payouts will increase up to 7%.

*Based on CPF LIFE Standard Plan payouts of a male member computed as of 2018.

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20% Lump Sum Withdrawal at Age 65• This option is not available for older members because they

had more liberal withdrawal rules.

Members whoturned 55 in

% of combined savings in the Ordinary and Special Accounts that could be withdrawn

2008 and before 50%

2009 40%

2010 30%

2011 20%

2012 10%

2013 onwards 0%


Greater flexibility, more options

You have the option to start your CPF LIFE payout later, up to 70 years old.

For members who turn 55 from 2013, you may withdraw up to

20% of your Retirement

Account savings

3 CPF LIFE plans to choose from when you want to start your payout


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Distributed to nomineesIf no CPF Nomination was made, the CPF savings will be forwarded

to the Public Trustee for distribution based on Intestacy Law or Muslim Certificate of Inheritance. Admin fee applies.

Discounted SingTel shares

Unused annuity

premium

Balances from OA, SA, MA,

RA

CPF Nomination

How to Make a CPF Nomination

CPF savings are not covered by a Will. They are protected from creditors to ensure that members’ dependants receive the savings promptly.

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1. The Retirement Account is created at age ____________.

2. The first ____________ of your combined CPF balances will be paid an extra 1% interest.

3. The additional extra interest of 1% earned on OA savings will be credited into the ____________________________________.

4. Cash top-ups into loved ones’ SA within the current FRS are eligible for up to _________________ of tax relief.

5. Monthly payout will increase by up to __________if member defer their CPF LIFE payout till age 70.

6. Members who buy a property after 55 can still use _________________ savings above BRS to finance the property purchase.

1, 2, 3s of CPF Recap

https://youtu.be/wOSdtjSs-UE

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For More Information

Refer online at

•http://www.cpf.gov.sg

Email

•[email protected]

Call

•1800-227-1188


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