CPF Retirement Sum Scheme

[carmelmore]

Anyone knows why CPF dashboard shows "You have met your Full Retirement Sum" but the amount is around $30k+ lesser than the amount shown on retirement sum pdf list? Payouts have not started yet.

Comparing to the 55th birthday year amount
https://www.cpf.gov.sg/content/dam/web/member/retirement-income/documents/RetirementSum.pdf

 

[BBCWatcher]

Possible reasons I can think of:

1. The CPF member has a property pledge/charge and made a lump sum withdrawal.

2. Combined with Ordinary Account and Special Account balances the Full Retirement Sum has been met. [The CPF Board will "sweep" dollars from SA (and from OA as well if necessary) into RA just before payout start.]

 

[dork32]

Anyone knows why CPF dashboard shows "You have met your Full Retirement Sum" but the amount is around $30k+ lesser than the amount shown on retirement sum pdf list? Payouts have not started yet.

Comparing to the 55th birthday year amount
https://www.cpf.gov.sg/content/dam/web/member/retirement-income/documents/RetirementSum.pdf

you probably used some of your sa to buy insurance, unit trust. this amounts to 30k

 

[Okenba]

Anyone knows why CPF dashboard shows "You have met your Full Retirement Sum" but the amount is around $30k+ lesser than the amount shown on retirement sum pdf list? Payouts have not started yet.

Comparing to the 55th birthday year amount
https://www.cpf.gov.sg/content/dam/web/member/retirement-income/documents/RetirementSum.pdf

Because the FRS that the dashboard is talking about is this year's FRS.
It does not project for you what your FRS will be when you hit 55.

You're using a projected FRS number and assuming that the dashboard is referring to that. It is not. It is referring to FRS for 2022.

 

[carmelmore]

Thanks for the input

What I meant was amount in Retirement account is less than what is shown on FRS list comparing to 55th birthday year amount though it shows FRS has been met in CPF dashboard.
SA can only receive contributions now plus $5k on CPFIS-SA and OA account is still paying housing loan where the loan is less than OA balance.

As I'm above 55, should I transfer SA+OA to FRS 55th birthday year amount shown on FRS list now or wait till CPF life payout starts and it will auto transfer the amount shown on FRS list?

 

[Value.Matrix]

Thanks for the input

What I meant was amount in Retirement account is less than what is shown on FRS list comparing to 55th birthday year amount though it shows FRS has been met in CPF dashboard.
SA can only receive contributions now plus $5k on CPFIS-SA and OA account is still paying housing loan where the loan is less than OA balance.

As I'm above 55, should I transfer SA+OA to FRS 55th birthday year amount shown on FRS list now or wait till CPF life payout starts and it will auto transfer the amount shown on FRS list?

Your FRS amount is based on your age at 55.

 

[henrylbh]

As I'm above 55, should I transfer SA+OA to FRS 55th birthday year amount shown on FRS list now or wait till CPF life payout starts and it will auto transfer the amount shown on FRS list?

What a strange question

On 55th birth day, it is automatic that SA+OA will be transferred to RA to meet FRS without action on your part. Anytime thereafter, you can still transfer any balance OA/SA or top up cash to RA up to prevailing limit of enhanced FRS.

 

[carmelmore]

On 55th birthday, it automatic transfer from SA+OA to meet FRS but I compare the amount in current RA balance to the year when reach 55th birthday on the FRS list, the amount in the list is higher than the amount in current RA account by around $30k+. However, on CPF dashboard it shows "You have met your Full Retirement Sum". Definitely did not withdraw from RA before.

https://www.cpf.gov.sg/content/dam/web/member/retirement-income/documents/RetirementSum.pdf

 

[BBCWatcher]

....As I'm above 55, should I transfer SA+OA to FRS 55th birthday year amount shown on FRS list now or wait till CPF life payout starts and it will auto transfer the amount shown on FRS list?

OK, so my guess #2 was correct.

SA earns 4.0% interest, so there's not much point in transferring SA to RA (which also earns 4.0% interest). The pre-CPF LIFE payout auto-transfer (and any voluntary transfer now) will draw from SA first then, if necessary to meet the FRS, OA.

However, you have at least a couple other options that could be much more attractive than the future auto-transfer:

(a) If you have cash sitting in a 0.5% interest earning bank account, for example, then you can put that cash to work harder by topping up your Retirement Account. The top up limit is the current Enhanced Retirement Sum, and that's based on principal only. You may qualify for tax relief since your RA is evidently below the FRS. This'll earn 4.0% interest that'll then boost your future CPF LIFE retirement income stream.

(b) If your SA balance exceeds $40,000 then you could "shield" SA and transfer $40,000 from SA plus your OA to your RA. To the extent you draw from OA (hopefully substantially) you'll be upgrading 2.5% interest earning dollars to 4.0% RA (feeding into CPF LIFE).

(c) If you have a qualified family member (such as a spouse) then you can (usually) transfer OA to each other. For example, your spouse could transfer her/his OA to your RA, and you could transfer your OA to his/her SA (or RA if she/he is age 55+).

 

[dork32]

SA can only receive contributions now plus $5k on CPFIS-SA and OA account is still paying housing loan where the loan is less than OA balance.

I will never do a sa transfer to ra. both are earning 4%. sa can withdraw anytime. ra kena trap.

i agree that i would rather use cash to top up than sa. sa is as good as cash at this stage. you can withdraw anytime. if i am going to trap more cash in the ra, i might as well use cash

 

[gold_eagle36]

I will never do a sa transfer to ra. both are earning 4%. sa can withdraw anytime. ra kena trap.

i agree that i would rather use cash to top up than sa. sa is as good as cash at this stage. you can withdraw anytime. if i am going to trap more cash in the ra, i might as well use cash

How about OA to RA. Ideally the OA money draw out to invest earn more than 4% but this is not guaranteed.

 

[BBCWatcher]

How about OA to RA. Ideally the OA money draw out to invest earn more than 4% but this is not guaranteed.

You can't easily transfer OA to RA. Here are the 3 ways it might be possible, to some degree:

1. Cross-spousal OA to RA transfers. Example: your spouse transfers his/her OA dollars to your RA, and you transfer your OA dollars to her/his RA. This is probably the best way if this option is available to you.

2. If you have substantially more than $20,000 in your OA, you can use the CPF Investment Scheme (OA) to buy something such as a 6 month T-Bill or bond fund using the OA dollars in excess of $20,000. Then you can close your CPF Investment Account and transfer the assets to your CDP account. Then you can liquidate the assets (or let the T-Bill mature). Finally you can take the proceeds and deposit them in your RA.

3. If you have substantially more than $40,000 in your SA then you can "shield" SA (well described elsewhere) and transfer the remaining $40,000 of SA plus OA dollars into your RA.

 

[dork32]

How about OA to RA. Ideally the OA money draw out to invest earn more than 4% but this is not guaranteed.

there is really no right or wrong here.

oa 2.5%, ra4%. higher interest will make the transfer attractive
oa can withdraw. ra kena trap. oa is more attractive.

my view is whether you have big ticket items few years down the road. it will be good to keep it in your oa.

also if you are able to beat the 4% ra is giving, leave the money in the oa. but by the time you have your ra, you would be very uncle already. trying to take on the 4% involves risk that may not be suitable for ah peks.

if your oa is rotting, and you see continuing rot for as long as you live, then transfer it to your ra.

 

[dork32]

2. If you have substantially more than $20,000 in your OA, you can use the CPF Investment Scheme (OA) to buy something such as a 6 month T-Bill or bond fund using the OA dollars in excess of $20,000. Then you can close your CPF Investment Account and transfer the assets to your CDP account. Then you can liquidate the assets (or let the T-Bill mature). Finally you can take the proceeds and deposit them in your RA.

this is a good method to get the oa money out. do you know how many times we can open and close the investment account?

 

[Andrew833]

this is a good method to get the oa money out. do you know how many times we can open and close the investment account?

I think it's not stated any where.
Only stated that you can close your investment account and transfer all stocks to CDP.

 

[dork32]

I think it's not stated any where.
Only stated that you can close your investment account and transfer all stocks to CDP.

This is why i am asking. otherwise, i have found the answers myself

 

[BBCWatcher]

this is a good method to get the oa money out. do you know how many times we can open and close the investment account?

I do not.

There are 3 banks that offer CPF Investment Accounts. It seems like at least 3 times would be possible — at least once with each bank.

 

[8zaoyu]

Anyone knows why CPF dashboard shows "You have met your Full Retirement Sum" but the amount is around $30k+ lesser than the amount shown on retirement sum pdf list? Payouts have not started yet.

Comparing to the 55th birthday year amount
https://www.cpf.gov.sg/content/dam/web/member/retirement-income/documents/RetirementSum.pdf

Bro/Sis, did you compare yr own previous 55th birthday Annuity Created Amount with others 55th birthday Amount (eg $228+k in 2027 Less $196k in current 2022) ?

 

[bargin]

Have met the FRS (pledge with property), wan to do voluntary housing refund by withdrawing funds from SA ($5k). the $5k will reduce the principal in housing as well the amount in the property pledge, thus will increase the RA amount. Is this a wise method ? Age above 55 but under 65. Do not need to consider tax relief.

 

[gold_eagle36]

You can't easily transfer OA to RA. Here are the 3 ways it might be possible, to some degree:

1. Cross-spousal OA to RA transfers. Example: your spouse transfers his/her OA dollars to your RA, and you transfer your OA dollars to her/his RA. This is probably the best way if this option is available to you.

2. If you have substantially more than $20,000 in your OA, you can use the CPF Investment Scheme (OA) to buy something such as a 6 month T-Bill or bond fund using the OA dollars in excess of $20,000. Then you can close your CPF Investment Account and transfer the assets to your CDP account. Then you can liquidate the assets (or let the T-Bill mature). Finally you can take the proceeds and deposit them in your RA.

3. If you have substantially more than $40,000 in your SA then you can "shield" SA (well described elsewhere) and transfer the remaining $40,000 of SA plus OA dollars into your RA.

Actually once RA is formed and you still have OA (can be sale of home or oa contribution from income), you can just top up to RA in the web. Just one step.

Not sure what you mean. Maybe your scenario is RA not formed.