CPF minimum Sum raised to $131,000
From July this year, Central Provident Fund (CPF) members will need to set aside more money in their Retirement Account.
The CPF minimum sum will be raised to $131,000, up from $123,000. This will apply to members who turn 55 from 1 July 2011 to 30 June 2012.
Those who have $131,000 can apply to withdraw the monthly payout of $1,170 when they reach the draw-down age of 65.
If they have less than $131,000, they can apply to withdraw a proportion of the monthly payout.
In a statement released on Tuesday, the CPF Board said the increase is in line with the Ministry of Manpower's announcement in August 2003 that the CPF minimum sum will be gradually raised to reach $120,000 (in 2003 dollars) in 2013.
This increase, which includes an adjustment for inflation, seeks to ensure Singaporeans set aside sufficient savings for their retirement.
In 2010, more than 40 per cent of CPF members who turned 55 met the required minimum sum of $123,000, according to then Manpower Minister Gan Kim Yong in February.
From 1 July 2011 as well, the Medisave minimum sum will be raised to $36,000 from $34,500 to ensure Singaporeans can meet healthcare expenses. Members will be able to withdraw their Medisave savings in excess of $36,000 from age 55.
The maximum balance a member can have in the Medisave Account is fixed at $5,000 above the minimum sum. Any excess is transferred to the member's Special Account if he is below 55, or to his Retirement Account if he is above 55 and has a minimum sum shortfall.
Medisave, Special and Retirement accounts earn 4 per cent interest, while the Ordinary Account earns 2.5 per cent interest.
Members reaching age 55 can attend CPF's monthly seminars to find out what happens to their CPF savings when they reach 55. The next two seminars are on 29 June and 14 July. Those who wish to attend can apply at www.cpf.gov.sg/seminar or at any AXS station.
