Need some advice on CPF RA for a 72yrs old man

[BBCWatcher]

If he withdraw 10k from his CPF, he mentioned that it will be taken from his RA ($2k left) first, then OA. Does it means that after his withdrawal of 10k from his CPF, his CPF Life plus plan payout will be reduced. This is because his RA will be depleted.

His current CPF LIFE payouts shouldn't be reduced, but they will not increase either. If he does nothing the $2K in his RA will likely be fed into his CPF LIFE payouts automatically this coming July. If he had a past (2024 for example) increase in his CPF LIFE monthly payout then this is probably exactly what happened (some contributions to his RA from work that then got swept into his CPF LIFE payouts in July in previous years).

I think he may be able to avoid this $2K RA withdrawal (if he wishes) by asking the CPF Board to adjust his CPF LIFE payouts now using the $2K in his RA. In other words, he can ask for an "early sweep" (an earlier recomputation of his CPF LIFE payouts).

Again, in these circumstances I don't think he should be in any rush to withdraw funds from his CPF account(s). That's at or near last place in terms of priorities. He (and the mother/wife) should take the time to decide what they'd like to do. Generally speaking they and the rest of the family should be trying to bolster their retirement savings/income security (especially the wife's/mother's since she's evidently at or near zero), claim MRSS dollars first, then tax reliefs next, then all available CPF bonus interest (the mother's/wife's) if possible. Cash deposits, withdrawals, and transfers would be performed consistent with these objectives.

 

[camholicx]

Thanks for the advice,

Yes confirmed will ask them to top up $2k each. But they definetly will need the cash from his OA account to do this top up.

 

[BBCWatcher]

Yes confirmed will ask them to top up $2k each. But they definetly will need the cash from his OA account to do this top up.

But that may not work for him. Any withdrawal might make him ineligible for the MRSS. It's a possibility, not a certainty; it involves some guesswork since we don't know his exact situation.

 

[Andrew833]

Hi all,

I have checked. He is under CPF Life Plus plan. He is currently drawing $450 per month. According to his CPF Singpass, he is eligible to withdraw $35k (I suppose this is OA). His HDB is fully paid. Still working as a cleaner with 1k salary.

OA: 38K
MA:52k
RA:2k


Based on this situation, he asked few questions:

1. If he transfer his OA to RA, his CPF life will draw higher monthly payout?
2. His wife 65 yrs old (Singaporean - housewife), has only few hundred in CPF. Can he withdraw his OA, and put it in his wife RA, so that she can enjoy CPF life? Is this recommended or should I tell him to withdraw and put in Mari saving or just remain in his OA?


Thank you.

He is born in 1953, can withdraw 50% of his CPF OA anytime.
His CPF life is not much, even if transfer the OA 38K to CPF Life.
Govt giving money in RA, RA cannot withdraw, CPF will auto arrange monthly payout. (below age 70 maybe different).
Money put into CPF Life is lock.

 

[CoffeeDrinker8899]

Money put into CPF Life is lock.

If the amount is below FRS, whether its in CPF life or RA (RSS), is about the same, locked.

CPF life seems to be just doing a tradeoff of giving up the interest in exchange for lifelong payouts?

 

[Andrew833]

If the amount is below FRS, whether its in CPF life or RA (RSS), is about the same, locked.

CPF life seems to be just doing a tradeoff of giving up the interest in exchange for lifelong payouts?

Even with FRS, your money still lock. Age 55 to 65 (now 70) - lock, after that payout in installment.
Emergency - cannot withdraw

 

[BBCWatcher]

If the amount is below FRS, whether its in CPF life or RA (RSS), is about the same, locked.

Even with FRS, your money still lock. Age 55 to 65 (now 70) - lock, after that payout in installment.
Emergency - cannot withdraw

No, that's not usually correct. If you have a property pledge or charge you may be able to withdraw as much as the Basic Retirement Sum from your CPF Retirement Account if you wish. The 2025 BRS is $106,500, for example. The maximum withdrawal amount from your RA will be lower than your age 55 BRS in these situations:

• Your RA has not met at least the Full Retirement Sum;
• You partially met the FRS using top ups;
• Your property pledge/charge is worth less than your age 55 BRS;
• You previously made a lump sum withdrawal from your RA;
• You are age 65+ and have already started lump sum withdrawals.

It's usually unwise to make lump sum withdrawals from your RA, especially significant ones. But often you can if you insist.

 

[Andrew833]

No, that's not usually correct. If you have a property pledge or charge you may be able to withdraw as much as the Basic Retirement Sum from your CPF Retirement Account if you wish. The 2025 BRS is $106,500, for example. The maximum withdrawal amount from your RA will be lower than your age 55 BRS in these situations:

• Your RA has not met at least the Full Retirement Sum;
• You partially met the FRS using top ups;
• Your property pledge/charge is worth less than your age 55 BRS;
• You previously made a lump sum withdrawal from your RA;
• You are age 65+ and have already started lump sum withdrawals.

It's usually unwise to make lump sum withdrawals from your RA, especially significant ones. But often you can if you insist.

You always advise people to go for ERS at soon as possible.
That's mean you are on different path as those who understand the word "stuck".
Therefore, don't need to explain any further.

 

[BBCWatcher]

You always advise people to go for ERS at soon as possible.

You should not mischaracterize my views or the various CPF RA withdrawal options.

 

[~sabaisabai~]

He is born in 1953, can withdraw 50% of his CPF OA anytime.
His CPF life is not much, even if transfer the OA 38K to CPF Life.
Govt giving money in RA, RA cannot withdraw, CPF will auto arrange monthly payout. (below age 70 maybe different).
Money put into CPF Life is lock.

yes is locked and will never get to see the money till pass on
only can see the mthly payout nia

 

[~sabaisabai~]

You always advise people to go for ERS at soon as possible.
That's mean you are on different path as those who understand the word "stuck".
Therefore, don't need to explain any further.

yes he is on different path
let him be if he wants to go with ERS. his cpf his call
will be waste of energy to debate on this issue
we all know that money will be locked and cannot touch it even emergency

 

[CoffeeDrinker8899]

Even with FRS, your money still lock. Age 55 to 65 (now 70) - lock, after that payout in installment.
Emergency - cannot withdraw

I agree with you in general in the context of "lock" meaning no lump sum withdrawals under normal circumstances. There seems to be some possibilities, under conditions like reduced life expectancy, subjected to approval.

 

[~sabaisabai~]

I agree with you in general in the context of "lock" meaning no lump sum withdrawals under normal circumstances. There seems to be some possibilities, under conditions like reduced life expectancy, subjected to approval.

yes, still subject to approval, may or may not get

 

[Andrew833]

I agree with you in general in the context of "lock" meaning no lump sum withdrawals under normal circumstances. There seems to be some possibilities, under conditions like reduced life expectancy, subjected to approval.

They already pushing the goal pole to age 70, next few years maybe 75.
Unless got medical condition, doctor certify it and subjected to CPF approval.

 

[Andrew833]

yes, still subject to approval, may or may not get

High chance cannot.
Gov give money in RA, my dad 80+, went to CPF with me to ask if can withdraw. CPF said by installment, direct deposit to bank account.

 

[CoffeeDrinker8899]

Even with FRS, your money still lock. Age 55 to 65 (now 70) - lock, after that payout in installment.
Emergency - cannot withdraw

As for 70, I am unreliably informed, 70 is the auto payout age, however payouts can start at 65 if one decides to do so.

On this topic, I do have some reservations regarding delaying payouts to 70 for CPF life. Lets say a person joins CPF life at 65 and delay payout to 70. I assume the premium $X is deducted in lump sum at 65, since the interest goes into a pool and not to the individual, subsequently the person dies at 69.9 without receiving any payout, his beneficiaries get back the premium $X in full. However the interest for the $X from 65-69.9 is lost. Is that correct?

 

[Andrew833]

As for 70, I am unreliably informed, 70 is the auto payout age, however payouts can start at 65 if one decides to do so.

On this topic, I do have some reservations regarding delaying payouts to 70 for CPF life. Lets say a person joins CPF life at 65 and delay payout to 70. I assume the premium $X is deducted in lump sum at 65, since the interest goes into a pool and not to the individual, subsequently the person dies at 69.9 without receiving any payout, his beneficiaries get back the premium $X in full. However the interest for the $X from 65-69.9 is lost. Is that correct?

Yes, not informed, I read from someone post then I found out.

For your case;
Beneficiaries get back the $X in full. Interest already goes to the premium of the pool, so $0.
After 70, more complicated. I'm not sure, so can't share.
Depend on what plan he/she choose.

 

[CoffeeDrinker8899]

If you have a property pledge or charge you may be able to withdraw as much as the Basic Retirement Sum from your CPF Retirement Account if you wish.

I am not familiar with property pledge, could you elaborate more. Are you saying if someone pledges their property, they could withdraw in lump sum the difference between the property's value minus a whatever benchmark?

 

[BBCWatcher]

yes he is on different path
let him be if he wants to go with ERS. his cpf his call
will be waste of energy to debate on this issue
we all know that money will be locked and cannot touch it even emergency

If you fund a CPF RA above the FRS (even to the ERS), you don't lose any lump sum withdrawal options you already have. (You might gain some, actually.) In particular, with a property pledge or charge (and assuming no prior Special Account top ups) you can withdraw up to your age 55 Basic Retirement Sum if you wish. In 2025 the BRS is $106,500. And that's from your RA. Funds in your OA are also available for withdrawal any time you wish.

You may already have a property charge in place if you've used OA dollars for housing.

On this topic, I do have some reservations regarding delaying payouts to 70 for CPF life. Lets say a person joins CPF life at 65 and delay payout to 70. I assume the premium $X is deducted in lump sum at 65, since the interest goes into a pool and not to the individual, subsequently the person dies at 69.9 without receiving any payout, his beneficiaries get back the premium $X in full. However the interest for the $X from 65-69.9 is lost. Is that correct?

No, that's not correct. If a CPF member dies before CPF LIFE payouts start then his/her CPF nominee(s) get all CPF savings, including the full RA balance with interest.

In fact, if you have this particular concern, it's a fantastic reason to choose the default CPF LIFE payout starting age (age 70). That means up to 5 additional years of zero life annuity premium. In other words, you have it exactly backwards.

When CPF LIFE was first introduced the life annuity premium was deducted at age 55. That part changed a long time ago now.

I am not familiar with property pledge, could you elaborate more. Are you saying if someone pledges their property, they could withdraw in lump sum the difference between the property's value minus a whatever benchmark?

You can pledge your home in Singapore of any value. If the value of your home is equal to or greater than your age 55 Basic Retirement Sum (BRS) then you can withdraw up to that amount in a lump sum from your RA if you wish (and with a couple other assumptions). If your home value is less than your age 55 BRS then you can withdraw up to that lower amount in a lump sum if you wish.

I'll state again that I'm quite astonished so many people seem inclined to reduce their economical rice pensions to cat food pensions. But you have such choices if you wish.

 

[Andrew833]

I am not familiar with property pledge, could you elaborate more. Are you saying if someone pledges their property, they could withdraw in lump sum the difference between the property's value minus a whatever benchmark?

At age 55, FRS into RA.
If you have a property that last you till age 95, you can pledge your property. Need to go CPF office to do it. After that, half of FRS can withdraw, maybe can transfer to OA. Once you sell that property, CPF will auto transfer that amount back to your CPF RA.

From CPF
Because property owners won’t need to worry about rent during retirement, they have the flexibility to set aside their FRS with a mixture of property (up to half the FRS, which is the Basic Retirement Sum (BRS)) and cash, and withdraw part of their Retirement Account savings down to the BRS.