Upon approaching age 55, you’ll grow to be very familiar with the three CPF retirement sums: Basic Retirement Sum, Full Retirement Sum, and Enhanced Retirement Sum.
The retirement sums for those turning 55 in 2019 are as follows.
Basic Retirement Sum (BRS)||
Full Retirement Sum (FRS)||
Enhanced Retirement Sum (ERS)||
The BRS, FRS, and ERS serve as guideposts in helping you plan your path to retirement. They also help to determine 2 factors at two different points of your retirement journey.
1. How much you can withdraw from age 55
At age 55, a Retirement Account (RA) is created for you. Savings from your Special Account (SA), followed by your Ordinary Account (OA) are used to set aside a retirement sum in your RA. Once a retirement sum is set aside, you may withdraw the balance in cash, anytime from age 55.
The retirement sum you set aside determines how much you can withdraw:
i. If you set aside the FRS, you can withdraw the remaining SA, followed by OA savings above the FRS
ii. If you’d like to withdraw more, you can choose to set aside the BRS — as long as you own a property1 — and withdraw the remaining savings above the BRS2.
iii. If you do not have the BRS, you can still withdraw up to $5,000.
Knowing what the BRS and FRS are can help you work towards saving up enough in your CPF for your golden years and give you a good estimate on how much you can withdraw from age 55.
However, if you feel that you have no immediate need for the money, you can always choose to leave the savings in your CPF accounts for the future and continue earning up to 6% interest per year3
2. How much you get as monthly payouts at your payout eligibility age
The retirement sum you set aside in your RA at age 55 is used to join CPF LIFE — an annuity scheme that will provide you with a monthly payout for as long as you live.
A few months before your payout eligibility age4, a letter will be sent out to you, informing you of your available options.
Together with the CPF LIFE plan you choose, the BRS, FRS, and ERS serve as a guide to estimating how much you’ll receive as monthly payouts. You will only need to choose your CPF LIFE plan when you wish to start receiving your payouts, which will be anytime from age 65.
Below, you can see how your retirement sum correlates to your monthly payouts. Essentially, the higher you set aside as your retirement sum, the higher your monthly payouts!
Based on CPF LIFE Standard Plan payouts computed as of 2019.
Retirement Sum at age 55||
Payouts at age 65|
|$60,000||$540 - $570|
$730 - $790|
|$120,000||$960 - $1,030|
$1,350 - $1,450|
|$200,000||$1,520 - $1,630|
$1,960 - $2,110|
Additionally, you can also choose to defer your payouts up to the age of 70 to increase the amount of payouts you get each month. For each year you defer, your payouts will increase by up to 7%!
Remember: you can set aside any amount in between the BRS, FRS, and ERS as your retirement sum, and your monthly payouts will be calculated accordingly.
1 To encourage CPF members to have a home for life and to secure a basic level of retirement income, the property must have a remaining lease that can last you to at least age 95.
2 CPF withdrawals above the BRS exclude the interest earned, any government grants received, and top-ups made under the Retirement Sum Topping-Up Scheme.
3 Retirement Account currently earns interest rates pf 4% per year. On top of an extra 1% interest paid on the first $60,000 of a member’s combined balances, since 2016, members aged 55 and above will also receive an additional 1% extra interest on the first $30,000 of their combined CPF balances, with up to $20,000 from the OA.
4The payout eligibility age is currently 65 for members who were born in 1954 or later.