CPF Easy Info Thread. :)

[maple96]

Qn1: For a senior citizen who's already getting payouts from CPF Life (& not paying for house), if for some reason there's some balance in his OA &/or SA account, is it best to empty those 2 accounts' into his RA?

CPF Life payout automatically starts at 65 for old cohorts unless they opt to defer. So this senior citizen is above 65 since he is already getting payouts? Which CPF Life Plan is he on? Standard Plan?

If he has some balance in OA/SA, he can choose to transfer the monies to RA (if there is still ERS Limit), and these will be paid out to him in the next annual review as additional mthly payout (AMP) if he did not apply to buy additional CPF Life Plan.

Whether he should transfer all the monies in OA/SA to RA would depend on his financial situation, eg is OA/SA his emergency fund? Since SA also earn 4%, is it better to keep it there as a high interest on demand savings account rather than transferred to RA to be locked up and streamed out as mthly payout?

Qn2: As long as a person is on CPF Life, the payout is till death? Is there any decision a person may alter that will put an expiry date(& not due to death) on the payout? Example: what if the person ran out of RA?

If you join CPF Life, payout is for life regardless of which plan u choose. If u choose Standard/Escalating Plan, RA will be zero, all payouts come from the CPF Life Pool.

U can exit CPF Life (ie your expiry date on payout) if u can meet the criteria defined by CPFB (refer to website). One example is critical illness.

Qn3: Supposedly to get the highest payout from CPF Life, one has to fulfil his cohort's ERS & choose the "Standard" plan. Based on current year's figure, it is an ERS of $264K & a payout of $2,110. But does it mean if a person's RA is >$264K, he will not get more than $2,110?

U can use the CPFB calculator to calculate the payout to see for yourself. If u have spare cash, u can always topup your RA up to the prevailing ERS (ie more than your cohort's ERS) to get higher payout. If CPF Life Payout already started, then refer to Q1 for the answers.

 

[henrylbh]

Qn1: For a senior citizen who's already getting payouts from CPF Life (& not paying for house), if for some reason there's some balance in his OA &/or SA account, is it best to empty those 2 accounts' into his RA?

The first batch under mandatory CPF Life has not reached 65.

Those now getting CPF Life had voluntary opted in and they may not have met the min sum. So what left in OA/SA is subject to rules applicable to their cohorts. Whatever the case, if they don't really need to withdraw the OA/SA, best is to move them to RA which can be left there till they want to start drawdown the RA in installments.

 

[henrylbh]

Qn1
Qn3: Supposedly to get the highest payout from CPF Life, one has to fulfil his cohort's ERS & choose the "Standard" plan. Based on current year's figure, it is an ERS of $264K & a payout of $2,110. But does it mean if a person's RA is >$264K, he will not get more than $2,110?

If choose Standard Plan, there will be no RA balance at start of CPF Life payout. A member who has met ERS of his cohort, can still top up his RA to prevailing ERS. The more he has in RA (from top-ups after commencement of life payout) and CPF Life, the higher the payout.

 

[BBCWatcher]

CPF Life payout automatically starts at 65 for old cohorts unless they opt to defer.

It’d be better to say the earliest CPF LIFE enrollees had age 65 default payout starts (with the option to defer), and all of these particular pioneering individuals (pun intended) voluntarily selected CPF LIFE over the default (for them) legacy Retirement Sum Scheme.

CPF changed this practice. Unless the rules change again, everyone entering CPF LIFE now or in the future (and those in the recent past) is/are subject to age 70 default payout start with the choice of an earlier start, as early as age 65.

It’ll be interesting to see when members start their CPF LIFE payouts. A majority of members under the legacy Retirement Sum Scheme do not start their monthly payouts as early as allowed, but CPF LIFE payouts are for life, so maybe these decisions will shift a bit. I see from U.S. data that about 34% of Social Security recipients start payouts at age 62, the minimum age allowed. (Age 70 is also that program’s maximum.) However, that program is not directly comparable since it features a small, fixed, real death benefit — which I happen to think is a better program characteristic, but it’s different — so the smart play for everyone in poor health (but not on Social Security disability) at age 62 is to start payouts as early as allowed.

 

[maple96]

It’d be better to say the earliest CPF LIFE enrollees had age 65 default payout starts (with the option to defer), and all of these particular pioneering individuals (pun intended) voluntarily selected CPF LIFE over the default (for them) legacy Retirement Sum Scheme.

Those who opted (voluntarily as u termed it) to join CPF LIfe where given a bait, a pretty attractive join bonus!

No, they do not have an option to defer in the past. It was only added recently, that's why their default start continue to be 65 and not 70, CPFB/MOM cannot change this rule for them


CPF changed this practice. Unless the rules change again, everyone entering CPF LIFE now or in the future (and those in the recent past) is/are subject to age 70 default payout start with the choice of an earlier start, as early as age 65.

It’ll be interesting to see when members start their CPF LIFE payouts. A majority of members under the legacy Retirement Sum Scheme do not start their monthly payouts as early as allowed, .

U simply cannot tolerate being precise and concise, short and sweet answers to the point , must write to promote your "propaganda" or rubbish which does not answer a person's question.

The case study is obviously for a senior citizen who had already started CPF Life payout, ie above 65! U seriously have comprehension problems!

Rubbish plus incorrect info (see my comments in red above) to confuse people. For your info, those under RSS (not yet 70) also must start payout latest by 70 or opt to start it at 65!

Pls answer to the point, no need to preach and preach, chinese call "si now"!

 

[BBCWatcher]

Maple96, the information you posted was a bit sloppy, and I elaborated, politely. If you're upset about that, that's all your problem.

 

[maple96]

Maple96, the information you posted was a bit sloppy, and I elaborated, politely. If you're upset about that, that's all your problem.

If a one sentence factually correct answer is sloppy, u really have some problems.

I merely corrected all your factually incorrect statements/words, if u are upset, that's your problem

 

[quiliner]

...
Qn 1 - Whatever money in CPF SA or OA that is left over and above BRS/FRS/ERS after the RA has been formed can be withdrawn as and when you need. In other words, you can basically treat CPF as a high interest savings account for that money! Up to you whether to empty (withdraw) them.
...
Qn 3 - The ERS is actually the maximum amount you can set aside for CPF LIFE to have the greatest CPF LIFE payouts. Any additional amount remaining in SA and OA you can choose to leave there to continue to gain interest and grow, or withdraw any amount you want, any time.

Hmm, okay, so my takeaway is, if one is getting maximum payout already, there’s no point (or if it is even possible to) throw money into RA. Leaving any excess above FRS/ERS is more liquid.

...Qn 2 - No, CPF LIFE payouts are for as along as you live - even if the total amount of payouts received exceed the RA. This is the advantage of CPF LIFE over the previous CPF Retirement Sum Scheme; in the latter, you only receive payouts until your RA is depleted...

Follow-up qn: what happens to those who can’t even meet their cohort’s BRS?

I believe the point of Q1 is whether it makes sense to shift SA+OA funds into RA in order to earn higher interest (RA interest is higher than OA interest), and then to benefit from that higher interest in the form of higher CPF LIFE monthly payouts. The short answer is yes, that maneuver can often make a lot of sense, particularly when there are a lot of OA dollars relative to SA dollars, enough "headroom" to make the top up, and enough wealth/income to "bridge" at least to age 65 (the earliest CPF LIFE payout start age)...

What about transferring all the OA funds to SA to let it remain liquid & still enjoy the same high interest rate as the RA?

...and only principal is counted for purposes of determining the maximum top up amount...

Don’t understand this line.

...A member who does this, who tops up to the ERS on his/her 55th birthday then every January thereafter as the ERS increases, will receive a higher CPF LIFE monthly payout than listed in CPF's sample ERS-level payout illustrations...

Will you be able to illustrate this with some sample numbers? Cos I’m unsure if I understand you correctly...take the current cohort for example:

If a person has $264K in his RA & doesn’t choose any CPF Life plan explicitly, hence resulting in the Standard plan being chosen for him, he will straight away get $2,110 right? No ambiguity in that right?

So next year, say the prevailing ERS increases to $270K, the person makes up the $6K difference either by OA/SA topup or cash topup, his payout amount will naturally exceed $2,110?

...best is to move them to RA which can be left there till they want to start drawdown the RA in installments.

No right? The moment they move the OA/SA balance into RA, it will be completely consumed to be streamed out as AMP right?

CPF Life payout automatically starts at 65 for old cohorts unless they opt to defer. So this senior citizen is above 65 since he is already getting payouts? Which CPF Life Plan is he on? Standard Plan?

Pioneer-gen. CPF Life Plus plan (deprecated).

...
If he has some balance in OA/SA, he can choose to transfer the monies to RA (if there is still ERS Limit),
...
Whether he should transfer all the monies in OA/SA to RA would depend on his financial situation, eg is OA/SA his emergency fund? Since SA also earn 4%, is it better to keep it there as a high interest on demand savings account rather than transferred to RA to be locked up and streamed out as mthly payout?

Just curious why the balance is not automatically & regularly “emptied” into the RA since CPF Life Payout has started for the pax...

...and these will be paid out to him in the next annual review as additional mthly payout (AMP) if he did not apply to buy additional CPF Life Plan...

May I know if there is a calculator for this? I’ve been trying hard to find on CPF’s site but can’t find:
Transfer how much more S$ into RA = specifically how much increase in AMP.

...
U can use the CPFB calculator to calculate the payout to see for yourself...

This is not the AMP calculator right?

 

[BBCWatcher]

What about transferring all the OA funds to SA to let it remain liquid & still enjoy the same high interest rate as the RA?

OA to SA transfers are only allowed before age 55 and only up to the Full Retirement Sum.

If a person has $264K in his RA & doesn’t choose any CPF Life plan explicitly, hence resulting in the Standard plan being chosen for him, he will straight away get $2,110 right? No ambiguity in that right?

No, that’s not quite correct, or at least some clarification is in order. CPF’s benefit illustrations assume that the Retirement Account is funded once all the way to the specified level within the month the member celebrates his/her 55th birthday, not in some later month. They also assume the member starts payouts at age 65. Under current rules payouts do not start by default at age 65, and thus there’s no default plan selection at age 65. They start by default at age 70. Payout amounts are substantially higher than CPF’s illustrations if payouts start at age 70.

So next year, say the prevailing ERS increases to $270K, the person makes up the $6K difference either by OA/SA topup or cash topup, his payout amount will naturally exceed $2,110?

Yes, and even higher still if the member keeps repeating these top ups every time the ERS is raised.

 

[lupster]

Anyone knows if MA voluntary contributions through paynow will be reflected immediately? TIA.

 

[BBCWatcher]

Anyone knows if MA voluntary contributions through paynow will be reflected immediately? TIA.

No, it’ll likely credit the next business day. Don’t cut it too close.

 

[kehyi4]

Anyone knows if MA voluntary contributions through paynow will be reflected immediately? TIA.

No, it’ll likely credit the next business day. Don’t cut it too close.

Or you could ask someone who actually did the VC recently (last week) to find out what happened: the VC to MA was reflected in my CPF balance straightaway after the fund transfer. CPF describes PayNow as "almost instant" and based on my experience, it appears to be so. Do note that i did it on a business day; it might be different on a non-business day

 

[BBCWatcher]

Or you could ask someone who actually did the VC recently (last week) to find out what happened: the VC to MA was reflected in my CPF balance straightaway after the fund transfer. CPF describes PayNow as "almost instant" and based on my experience, it appears to be so. Do note that i did it on a business day; it might be different on a non-business day

That’s common but not universal. Banks can occasionally screw this up. Moreover, I cannot actually find a published CPF service standard for MediSave top ups via PayNow QR, and they publish a lot of service standards. For RSTU it’s “almost instantly.”

Net net: allow one business day for this channel. If your bank and CPF beat that, great!

The consequences of missing a deadline can be awful, and there is no recourse, so don’t cut it too close.

 

[dork32]

Don’t understand this line.

talk about maple's post being sloppy.

yeah bbc's answer is not sloppy, but people dont understand. this is better?

 

[dork32]

That’s common but not universal. Banks can occasionally screw this up. Moreover, I cannot actually find a published CPF service standard for MediSave top ups via PayNow QR, and they publish a lot of service standards. For RSTU it’s “almost instantly.”

Net net: allow one business day for this channel. If your bank and CPF beat that, great!

The consequences of missing a deadline can be awful, and there is no recourse, so don’t cut it too close.

you just want to win

 

[BBCWatcher]

you just want to win

Against my better judgment, I'm going to respond to this comment.

Yes, I want to win, and I want everyone to win, to get all their desired top ups credited before the deadline.

Fresh on my mind right now is the fact that my credit card, issued by one of three Singapore's local banks (in our supposedly world class financial centre -- I have my doubts, often), just isn't working. It's not "transaction declined," it's just dead -- some merchant-to-card network (or issuer) problem, with the merchant terminals -- yes, plural merchants and terminals -- simply timing out. I've tried the chip, I've tried contactless, and both are no go. I've tried transactions several hours apart, and no go.

My card is supposed to work, or at least generate a "transaction declined," within a second or two. That's the service standard. The fact is, it's not working.

A major supermarket chain in the United States couldn't process any debit or credit card payments for an hour or more on Christmas Eve, 2019. This failure, in the country that pioneered card payment systems, was particularly newsworthy because something like half the U.S. population is trying to buy groceries on Christmas Eve, and their deadline is...Christmas Eve. (Slight exaggeration, but it's a HUGE grocery shopping day.)

....Anyway, if you want to try topping up your MediSave Account at 11:59 p.m. on December 31, 2019, using PayNow QR, you can try. I don't recommend cutting it that close, especially since CPF doesn't even publish a service standard for MediSave top ups via PayNow QR. (RSTU I can find, but not MA.) I don't want anybody to be disappointed! I recommend you try one business day ahead, which this year is (let's say) before 4:00 p.m. on December 30, 2019.

 

[henrylbh]

you just want to win

Besides being superfluous, this also one of his patterns. Can't help not to notice

 

[henrylbh]

You notice any thing else?

 

[tangent314]

Alright people, cut the crap from this thread. Stick to the topic instead of attacking one another and playing out your childish feuds in public or there will be infractions. There will be no further warnings.

 

[maple96]

Quiliner, I copied 2 posts from another thread here, so u can also read:

1. If u are below 55, u will be interested to know that the extra 1% interest goes to SA.

2. If u are 55 and above, u will be interested to know that the extra 1%+1% goes to RA and is based entirely on RA if it is at least 60k.

3. If u have started CPF Life, u will be interested to know the following:

a. If u are on CPF Life Basic Plan, the extra interest goes to RA

b. If u are on CPF Life Standard or Escalating Plan, the extra interest goes into the CPF Life Pool.

c. The extra interest is based on RA+CPF Life Premium if these are at least 60k. RA will be zero under Standard/Escalating Plan unless the member do topups to RA after CPF Life starts, but the RA will not earn the extra interest.