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Old 06-09-2019, 03:41 PM   #10
Master Member
Join Date: Oct 2016
Posts: 4,357
If you can withdraw $90,500 from your newly formed Retirement Account on your 55th birthday, you can also withdraw $90,500 from your Retirement Account just before you start CPF LIFE payouts, which can be as late as (just before) your 70th birthday. All you need is a property pledge either way, when (not before) you want to withdraw. There's also an up to 20% withdrawal option, inclusive of the optional $5,000 withdrawal amount.

Second, the 20% earmarked for the CPF Lifelong Income Fund is the maximum, but it's not fixed. If you'd like to reduce that percentage then one way is simply to wait until age 70 to start CPF LIFE payouts. Another way is not to get (or to get) gender reassignment surgery, depending on your current gender. (The percentage is likely to be higher for women. For men it's unlikely to be 20%.) To my knowledge CPF hasn't published the current, precise details on how that percentage is calculated, but those seem like reasonable guesses.

So why do you want to give up 1.5 percentage points of lovely interest for at least 10 years, compounded annually, in order to slightly reduce the portion of your Retirement Account allocated to the CPF Lifelong Income Fund that you and/or your nominees will always get back at least without interest (as principal), and possibly more than that? That's a terrible trade financially.

Here's a better question: why wouldn't you double down on collecting even more of that juicy, lovely 4% interest -- topping up your Retirement Account above the Full Retirement Sum (as high as the Enhanced Retirement Sum) on your 55th birthday, if you can afford it? So what if a maximum of 20% of your Retirement Account is earmarked for the CPF Lifelong Income Fund just before you start CPF LIFE payouts (Basic Plan), an amount that will always come back to you and/or your CPF nominees at least as principal? Assume the worst case if you like ("lost," principal return only), and it's still a heck of a great deal from age 55 onward. Have you noticed what fixed deposit interest rates are? Singapore Savings Bond rates?

Do you still need some help calculating this, or do you get the point now? What you're proposing is a dreadful idea financially.

Where did you get this idea?
Thanks bbc for the clarification.
Perhaps was confuse by this below.......

BRS is the most worth it in the bequest, you lose out huge amount to bequest for ERS and FRS if you die between 65 to 78 iirc.

The correct way pointed out by one guy is to withdraw at BRS and take that monthly pay out.
Take the excess beyond BRS amount withdrawn out, top up to CPF for extra payout. This way the bequest lost is lesser, your payout is still good. You also enjoy the 4pct interest tru out.
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