Whoa, we've already got a lot of misunderstandings of fact in this thread. That was quick.
1. how are you going to park 350k at 55 in your ra if the ers is 240+k?
The 2018 Enhanced Retirement Sum is $256,500. The 2019 and 2020 figures are already announced, and they increase 2.8 to 2.9% per year.
But let's pretend for a moment we don't know the 2019 and 2020 figures, and let's assume AMD_FREAK is age 40 today. Taking $256,500 and adding 2.5% per year compounded we get to $371,488 in only 15 years (2033 dollars). That's more than $350K, so there you go, that's the answer to how you park $350,000 at age 55 in your Retirement Account. Easy.
Hwsemb also pointed out how this works, but I'm just illustrating the point with some sample math.
2. if you are looking at passing what is left to your wife and kids, you better look at basic. standard does not earn you interest.
No, and no. All CPF LIFE plans are actuarially fair, none of the CPF LIFE payout plans guarantees a bequest, and all CPF LIFE payout plans feature decreasing nominal bequests once payouts start. CPF LIFE is
not well designed for bequests. Among CPF's programs, MediSave is actually the best designed for bequests (although it's not ideal for that purpose either).
If you want to assure a bequest, there are better, more effective financial products to do that, most particularly whole life insurance products, and you can even buy such products using surplus CPF dollars if you wish. CPF LIFE can be an extremely effective tool to help
defend a bequest (and, better yet, lifetime gifts), but it is not itself designed well to deliver bequests.
You can try using a screwdriver to hammer a nail, but it's not a great idea. Likewise, you can try using CPF LIFE to deliver a particular bequest (rather than to defend one), but it doesn't actually work.
My understanding is our commitment to start CPF LIFE (whether to choose standard plan, escalating plan...) will begin from age 65 onwards.
No, the commitment only starts(*) when you start receiving payouts (i.e very shortly before, when you make a payout decision). If you do nothing, the default is that payouts start at age 70 (and my understanding is the default payout plan is the Standard Plan). Any other outcome requires you to
do something, to take specific action. The CPF Board will send you occasional love letters, but if you simply do nothing, that's what happens (age 70 start, default payout plan).
(*) There is a partial commitment if/when you make Special Account and Retirement Account top-ups (which typically qualify for tax relief), but that partial commitment is not a commitment to the payout starting date or to the payout plan. And there are still exceptions for acceptable substitute life annuities, or loss or termination of Singapore status.
Commitment for CPF Life starts at 55, cos this is when the lockdown starts.
No, that's only when a Retirement Account is formed. But RA funds are not "locked," not all of them anyway. In particular, you can make a property pledge and pick any CPF LIFE participation level between the Basic Retirement Sum (plus SA top-ups) and the Full Retirement Sum, and you can make that pledge any time up until just before your 70th birthday and before CPF LIFE payouts start. You can then withdraw any RA funds that aren't participating at any time you wish, or leave them be.
Drawn down starts at 65 to 67, subject to new pope-shifting.
No, CPF LIFE payouts start at age 70 unless you take specific action. If you choose to start payouts earlier, they can start any time earlier, as early as age 65. (Maple96 pointed this out, too.)
