CPF RSS Payout Issue

[oceanicmanta]

Asking on behalf of a relative's family. Female, Age 88.

31 Mar 2024
RA = 21.1K. OA n SA zero.

Started receiving $435 monthly from Feb 2024 under RSS.

CPF Dashboard stated payout would last around 7 years. ( Total Payout = $ 36,540 over 7yrs )

Son used CPF Payout Calculator (non CPF Life) to estimate new monthly payout with $10k top up.

CPF Calculator result showed Mom would get $813 a month for around 5 years ( Total Payout = $48,780 ) vs existing $435 monthly for 7 years

Son then tops on $10k via PayNow on 31 Mar 2024 to Mon RA.

April 2024
However, In April, CPF informs Mom that her new payout is $623 monthly to last around 4 years based on RA of $31k ( ie Total Payout = $29,904)

Dashboard currently also shows this amount.

Son enquires with CPF. CPF replied that $623 is correct.

CPF claimed $813 had assumed a top up of $20k in Mar 2024 ( even though Calculator shows 10k) , but since top up was only $10k, Mom would just get $623 monthly for next 5 years ( even though DashBoard says 4 years )

Now pending further clarifications with CPF.

=======================================================================

Do the calculations look reasonable ? Or is Calculator wrong ?

1. per DashBoard, after 10k top up and receiving $623 monthly for 4 years, the total payout of $29.9k is less than the total payout without top up over 7 years of $36.5k
   
   
2. per CPF reply, after 10k top up and receiving $623 monthly for 5 years, the total payout of $37,3k is just $800 more than the total payout before top up
   
   
3. per Calculator, topping up 10k, to receive $813 month over 5 years for a total $48.7k seemed generous
   
   ==================================================================
   
   Would anyone have topped up 10k if 1) or 2) above was correct ?
   
   Or am I missing something ?

 

[wutawa]

Asking on behalf of a relative's family. Female, Age 88.

31 Mar 2024
RA = 21.1K. OA n SA zero.

Started receiving $435 monthly from Feb 2024 under RSS.

CPF Dashboard stated payout would last around 7 years. ( Total Payout = $ 36,540 over 7yrs )

Son used CPF Payout Calculator (non CPF Life) to estimate new monthly payout with $10k top up.

CPF Calculator result showed Mom would get $813 a month for around 5 years ( Total Payout = $48,780 ) vs existing $435 monthly for 7 years

Son then tops on $10k via PayNow on 31 Mar 2024 to Mon RA.

April 2024
However, In April, CPF informs Mom that her new payout is $623 monthly to last around 4 years based on RA of $31k ( ie Total Payout = $29,904)

Dashboard currently also shows this amount.

Son enquires with CPF. CPF replied that $623 is correct.

CPF claimed $813 had assumed a top up of $20k in Mar 2024 ( even though Calculator shows 10k) , but since top up was only $10k, Mom would just get $623 monthly for next 5 years ( even though DashBoard says 4 years )

Now pending further clarifications with CPF.

=======================================================================

Do the calculations look reasonable ? Or is Calculator wrong ?

1. per DashBoard, after 10k top up and receiving $623 monthly for 4 years, the total payout of $29.9k is less than the total payout without top up over 7 years of $36.5k
   
   
2. per CPF reply, after 10k top up and receiving $623 monthly for 5 years, the total payout of $37,3k is just $800 more than the total payout before top up
   
   
3. per Calculator, topping up 10k, to receive $813 month over 5 years for a total $48.7k seemed generous
   
   ==================================================================
   
   Would anyone have topped up 10k if 1) or 2) above was correct ?
   
   Or am I missing something ?

i hope this can serve as a stern warning for those who choose to top up cpf or trust their online calc.

 

[henrylbh]

I would say with certainty that the payout of $813 is wrong if the RA before topping up was $21.1k. That would exhaust the RA a few months after 3 years.

But at $613, the RA would exhaust a few months before 5 years, though the Board has a policy of paying in 5 years for those who top up after their PEA.

 

[henrylbh]

i hope this can serve as a stern warning for those who choose to top up cpf or trust their online calc.

You wont be cheated by the system even if you are paid less or more. The payout is based on balance in RA until it is exhausted.

 

[wutawa]

You wont be cheated by the system even if you are paid less or more. The payout is based on balance in RA until it is exhausted.

rss is much simpler than cpf life.

 

[henrylbh]

rss is much simpler than cpf life.

Definitely simpler. You are paid based on what you have, no more or less and you are in control on how long it will last. In CPFL, you bet what you have. If lucky you get more and if not, you get less. CPFL is a system where some MUST loss in order for some to gain.

 

[CoffeeDrinker8899]

Or am I missing something ?

1. One thing I don't understand is how this person is able to get this level of payout at her CPF RA balance level, I have always been under the impression that if a person do not reach a certain milestone sum, they will only get the minimum payout sum which is currently $350/mth. Is it that they adjust accordingly due to her high age?

2. The 10k lump sum top-up could potentially be a bad decision if the person receiving the top-up is eligible for matched retirement savings scheme which has an annual cap of $2k and a lifetime cap of $20k. If the 10k is split up into 5 top-ups of 2k per year, the cost is the same and the gross total amount added to CPF will be doubled at 20k.

 

[henrylbh]

1. One thing I don't understand is how this person is able to get this level of payout at her CPF RA balance level, I have always been under the impression that if a person do not reach a certain milestone sum, they will only get the minimum payout sum which is currently $350/mth. Is it that they adjust accordingly due to her high age?

She is 88 and her payout is based on what she had and what she had will be spread over a period of 5 years from her last top last.

In her case she may not have drawn down her RA before and starting last or so she has been forced to start payout.

2. The 10k lump sum top-up could potentially be a bad decision if the person receiving the top-up is eligible for matched retirement savings scheme which has an annual cap of $2k and a lifetime cap of $20k. If the 10k is split up into 5 top-ups of 2k per year, the cost is the same and the gross total amount added to CPF will be doubled at 20k.

It is stated that the female concerned is already age 88. You think she still eligible for MRSS?

 

[MindMatrix]

She is 88 and her payout is based on what she had and what she had will be spread over a period of 5 years from her last top last.

In her case she may not have drawn down her RA before and starting last or so she has been forced to start payout.

It is stated that the female concerned is already age 88. You think she still eligible for MRSS?

Just to share in case any bros have family that might be interested, there was a change announced recently, which will take effect from 1 Jan 2025.

Currently only those aged 55-70 are eligible for MRSS. In future, there's no upper age limit. So if someone is 88 yrs old, they can still benefit from MRSS.

https://www.cpf.gov.sg/member/infohub/news/cpf-related-announcements/budget-highlights-2024

 

[oceanicmanta]

Just to share in case any bros have family that might be interested, there was a change announced recently, which will take effect from 1 Jan 2025.

Currently only those aged 55-70 are eligible for MRSS. In future, there's no upper age limit. So if someone is 88 yrs old, they can still benefit from MRSS.

https://www.cpf.gov.sg/member/infohub/news/cpf-related-announcements/budget-highlights-2024

thanks for reminder .. will look to do this for my own family .. Cap is $2k per year for 5 years

 

[oceanicmanta]

I would say with certainty that the payout of $813 is wrong if the RA before topping up was $21.1k. That would exhaust the RA a few months after 3 years.

then again, with just RA 21.1k, the original payout of $435 monthly for 7 years seem generous too ( compared to $623 for 4-5 years after top up)

But at $613, the RA would exhaust a few months before 5 years, though the Board has a policy of paying in 5 years for those who top up after their PEA.

Any guides on how to estimate the duration of payout ?

If Member requests, would CPFB be able to provide a more definite duration eg) 4yrs 10 months .. rather than "around 4 years" or "around 5 years" ?

Does it work like an "Amortising Loan" ? and follow CPF Interest methdology ( ie Monthly Payout do not earn Interest for that Month, Interest is accrued Monthly but credited Yearly )

I will try to work something out on Excel.

 

[henrylbh]

Asking on behalf of a relative's family. Female, Age 88.

31 Mar 2024
RA = 21.1K. OA n SA zero.

Started receiving $435 monthly from Feb 2024 under RSS.

CPF Dashboard stated payout would last around 7 years. ( Total Payout = $ 36,540 over 7yrs )

Son used CPF Payout Calculator (non CPF Life) to estimate new monthly payout with $10k top up.

CPF Calculator result showed Mom would get $813 a month for around 5 years ( Total Payout = $48,780 ) vs existing $435 monthly for 7 years

There must be something amiss in the info you provided. If remaining RA is 21.1k at 31 Mar, no way will the RA last for about 7 years if the payout is $435. RA wouldn't last 5 years even if counting the payout in Feb and Mar.

 

[henrylbh]

Just to share in case any bros have family that might be interested, there was a change announced recently, which will take effect from 1 Jan 2025.

Currently only those aged 55-70 are eligible for MRSS. In future, there's no upper age limit. So if someone is 88 yrs old, they can still benefit from MRSS.

https://www.cpf.gov.sg/member/infohub/news/cpf-related-announcements/budget-highlights-2024

Thank for the info and update. Gov is really pouring money on those seniors with low in CPF. Even the SSS and WIS will be enhanced.

 

[oceanicmanta]

There must be something amiss in the info you provided. If remaining RA is 21.1k at 31 Mar, no way will the RA last for about 7 years if the payout is $435. RA wouldn't last 5 years even if counting the payout in Feb and Mar.

according to Son, there was a CPF Letter in 2023 informing Mom of the $435 monthly payout to last around 7 years, and payout would begin Feb 2024

and the same info was reflected in Mom's CPF Dashboard which he screenshot before making 10k top up.

correction: the RA at 31 Mar was $22.1k

based on initial Excel workings, $22.1k & $435 monthly would have lasted 60 months (starting Feb24, without top up), depleting on 61st month ( double checking my Excel, will post for comments )

 

[SBC]

RSS current design is to exhaust all RA amount till 90. Amount looks rite. Will be able last 2 years plus.
call hotline to confirm

 

[royalmix]

31 Mar 2024
RA = 21.1K. OA n SA zero.

Balance in MA?

 

[wutawa]

Balance in MA?

How is this going to have any impact on the payout?

 

[royalmix]

How is this going to have any impact on the payout?

Extra interest!

 

[wutawa]

RSS current design is to exhaust all RA amount till 90. Amount looks rite. Will be able last 2 years plus.
call hotline to confirm

What happen to Ra balance after 90yo? Stuck?

 

[royalmix]

What happen to Ra balance after 90yo? Stuck?

CPF calculates payout to last till 90 years old (revised policy) because of complains it last till 95 in the past. Method of calculation is what they are discussing here. Payout will continue to stream out until RA balance is zero. Tho 90 years is the revised policy, movements in CPF accounts can affect when the final zero balance occur, possible after 90 or before 90 if balance is small.