Growing your CPF Retirement Fund (Part 2)

As a wealth builder, it is important to start compounding your CPF savings as early as possible when you are in your prime. This is because if you start early, the compound interests can work wonders for your retirement sum. When you reach 55 years old, your Special and/or Ordinary Accounts savings will be transferred to your Retirement Account to form your retirement sum. Your retirement sum can be used to join CPF LIFE or the Retirement Sum Scheme which provides you with a monthly payout of about 20 years.

After setting aside both the Full Retirement Sum or Basic Retirement Sum with sufficient property charge/pledge and the current MMS of $43,500, you can choose to withdraw​ the remaining cash balances in your Ordinary and Special Accounts, or continue to keep your savings in CPF to earn attractive interest.

For myself, I would be placed on the CPF LIFE scheme but when I saw the monthly payout for the Basic Retirement Sum (BRS), I almost fell off the chair. I mean what can you do with $700 per month? Thirty years down the road, with the onset of inflation, the diminishing purchasing power of money would mean that $700 would be equivalent to today’s $200. In today’s context, you definitely cannot survive in Singapore with a $200 monthly payout. Thus, in my point of view, this scheme is definitely not attractive for me. However, from January 2016, we will have one more option to choose from – Enhanced Retirement Sum.

Your monthly payout* for life from 65Retirement Account savings required at 55
If you own a property and choose to pledge your property.​​$660 – $720Basic Retirement Sum (BRS)


​If you do not own a property or choose not to pledge your property.$1,220 – $1,320Full Retirement Sum (FRS)


The FRS is 2 x BRS.

​If you wish to put more savings in CPF LIFE.$1,770 – $1,920Enhanced Retirement Sum (ERS)#


The ERS is 3 x BRS.​

Payouts are estimates based on CPF LIFE Standard Plan parameters in 2016

#Available from January 2016


Managing your CPF funds is important because it may impact the quality of your retirement lifestyle. Nonetheless, my stance has always been not to rely solely on your CPF retirement sum for your golden years..

Before it is too late, always make an effort to develop various streams of income sources to supplement your retirement fund. Acquire hard assets like properties for rental incomes, buy participating life policies with cash bonuses, park some cash in fixed deposits, invest in dividend stocks, write books to develop royalties, and most importantly, continue to work if you can to stay mentally healthy and socially active. Always make it a mantra that CPF payout is a form of “bonus” and it should not be the main source of your income in your golden years. Find out more about how to manage your CPF monies in

One thought on “Growing your CPF Retirement Fund (Part 2)

  • December 19, 2015 at 5:12 am

    In 30 yrs time, the BRS would have risen in tandem with inflation and the payout should be about $700 in today’s value.

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