CPF Retirement Account: What Are the Different Retirement Sums in Singapore?

Does it feel like you’ve got golden handcuffs on when it comes to your corporate job? Or are you already dreaming of not having to deal with another underwhelming (and wayyyyyyy too expensive) lunch in the CBD?

Well, every month our CPF contributions allow us to put money away into the CPF Ordinary Account (OA) and CPF Special Account (SA).

These go towards what’s called our “Retirement Sum” when we turn 55. That’s also the point when we can think – hopefully! – about retiring in generally comfortable circumstances in the not-too-distant future.

But what exactly is the Retirement Sum, how does it change and how should we think about the various tiers when we eventually turn 55? 

Let’s really dig in to the numbers (yay!) and find out all the juicy deets about retirement income.

 

What exactly is the CPF Retirement Sum?

When you hit the Double 5 (55 years of age) you’ll be presented with a retirement gifts of sorts from the CPF – a Retirement Account (RA).

That’s where all your funds from your CPF OA and CPF SA will be transferred to. Currently, your SA can remain open after that, as long as long as the Full Retirement Sum (FRS)—currently S$205,800 in 2024—is met.

Money from your CPF SA will be transferred over first and, if there’s still remaining money required to top up to the FRS after your CPF SA has been emptied out, then money from your CPF OA will be used. 

There has been quite a bit of drama—by CPF standards anyway!—about changes to the CPF SA from next year. That’s because, beginning from 1 January 2025, the government will close your CPF SA when you reach 55.

Previously, individuals were allowed to keep their CPF SA open. Overall, it won’t impact too many individuals as a practice known Special Account “shielding” is what the CPF Board wants to stop.

This is where people invest their CPF SA savings through the CPF Investment Scheme (CPF-IS) around six months before turning 55.

After the RA is created, they can then sell their investments and—voila!—they can keep these funds in their CPF SA to enjoy that higher interest rate. 

While this was the big change, there were also some amendments to the various retirement sums. But, firstly, what are the actual different retirement sums?

 

How much is the CPF Retirement Sum?

There are actually 3 different Retirement Sums:

• Basic Retirement Sum (BRS)
• Full Retirement Sum (BRS x 2)
• Enhanced Retirement Sum (BRS x 3 currently but will be BRS x 4 from 1 January 2025)

“Nah, seriously?!”, you scream. As if it wasn’t confusing enough.

It’s also important to know that all 3 Retirement Sums increase by just over 3% every year to keep pace with inflation. 

One of the key changes that came with the recent announcement of CPF SA closures was that the ERS would be raised to 4 times the BRS from 2025, from the 3 times currently. 

Here are the Retirement Sums from 2024 to 2027.

Year of 55th birthday	Basic Retirement Sum	Full Retirement Sum	Enhanced Retirement Sum
2024	$102,900	$205,800	$308,700 (Current)
2025	$106,500	$213,000	$426,000 (From 1 January 2025)
2026	$110,200	$220,400	$440,800
2027	$114,100	$228,200	$456,400

Okay, but I’m not turning 55 yet. How do I work out MY Retirement Sum?

CPF does not publish Retirement Sums beyond 2027. 

To estimate your own Retirement Sums, first figure out how many years it’ll take for you to reach age 55, then use a compound interest calculator to calculate.

For example, if you’re 35 years old this year, you’ll be 55 years old in 20 years’ time. Input $102,900 as the “initial investment”, 20 years in “length of time”, take 3.3% as the “interest rate”, and for the interest to compound “annually”. 

Using this method, here are your estimated Retirement Sums:

• Basic Retirement Sum: $196,979.85
• Full Retirement Sum: BRS x 2 = $393,959.70
• Enhanced Retirement Sum: BRS x 4 = $787,919.40

But this is only an estimate, assuming that the Retirement Sums continue to grow at 3.3% in perpetuity. CPF can always change that growth rate depending on inflation and other factors.

 

How much can I withdraw from my CPF at age 55?

If you own a home in Singapore with a remaining lease that can last you up to age 95, then you can withdraw your CPF savings above the Basic Retirement Sum.

You’ll have to “pledge” your property to CPF so that CPF can count your property value as part of your total savings. 

If you sell your home in the future, you’ll need to refund the sale proceeds to your CPF account — up until it hits the Full Retirement Sum.

The withdrawal amount excludes the following (which will remain in your account and go towards retirement payouts):

• Interest earned
• Any government grants you received
• Top-ups made under the Retirement Sum Topping-Up Scheme

Example: You’re 55 this year, and you have $300,000 in your CPF. You own an HDB flat which you agree to pledge to CPF. You can therefore withdraw up to $300,000 – $102,900 (BRS) = $197,100.

Alternatively, you can opt NOT to pledge your property to CPF. That means you can withdraw up to $300,000 – $205,800 (FRS) = $94,200.

Either way, you can still sell your home in the future. In the first scenario, you’ll need to refund some money to CPF, up until you hit your FRS. In the second one, you get to keep the sale proceeds.

 

What happens to the Retirement Sum sitting in my CPF?

The reason for setting aside the Basic or Full Retirement Sum in our CPF is so that we can get sufficient payouts during retirement, under the CPF LIFE scheme.

Read more: CPF LIFE – The Complete Guide to Monthly Payouts, Plans & Minimum Sums

The more you have in your CPF account at retirement, the higher your monthly payouts, as this screenshot from CPF shows:

Screenshot from CPF website

Note that you can still get some monthly payout even if you do not hit the Basic Retirement Sum. However, it’s going to be very low.

Which also brings us to the next question around which Retirement Sum you should target…

 

Should I be looking at the Basic or Full Retirement Sum?

If you are a home owner with a decent amount of CPF savings, you might be wondering a few things:

• Should I pledge my property so I can withdraw my savings above the Basic Retirement Sum?
• OR should I keep the Full Retirement Sum in my CPF, i.e. withdraw less?

Looking at the CPF LIFE table above, we can see that keeping the bare minimum BRS in your account will result in pretty skimpy retirement payouts. 

Any 55-year-olds with $102,900 (BRS) in their CPF will only get about $840 to $900 a month. Is that enough to live on? Perhaps, but it’s probably not going to be very comfortable. 

On the other hand, if you have the Full Retirement Sum of $205,800 at 55, you’d get a more decent $1,560 to $1,670 a month when you reach 65. This is a more desirable “allowance” given the ever-rising cost of living.

Do remember that when your RA is created at 55, any funds in there will earn annual interest at the higher, longer-term rate that’s also applicable to the SA – currently 4.05%. 

So if you have a choice, it makes sense to aim for the highest Retirement Sum you can afford.

Of course, financially-savvy retirees may choose to withdraw a larger lump sum at age 55 to invest in other retirement income assets. 

It’s a good idea to diversify your retirement portfolio, but just make sure your investments are relatively safe given you’re about to retire! 

Don’t go and blow it all on horse betting or the latest “hot” crypto coin, is what we’re saying.

 

Will my retirement payments stop if my CPF Retirement Account runs out of money?

The short answer is “no”, this won’t happen if you’re on CPF LIFE.

If you were born in 1958 and after, and have at least $60,000 in your Retirement Account when you’re at the age you can receive payouts (age 65 or later), you are automatically enrolled in CPF LIFE.

Even if you (or more likely, your parents) are not auto-enrolled in CPF LIFE, don’t fret: You can apply to join the scheme any time from 65 up to one month before you turn 80 years old.

CPF LIFE guarantees retirement payouts for life, regardless of how much remains in your account in old age. So, even if you manage to live till the age of 150, you will still continue to receive payouts.

 

Is CPF LIFE the same as the Retirement Sum Scheme?

CPF LIFE is the primary retirement income scheme for all CPF members. It replaces the old Retirement Sum Scheme, which is currently being phased out. As the CPF describes it on its site, “CPF LIFE is an insurance product, not an investment product”.

Both give you monthly payouts during retirement. But the old Retirement Sum Scheme gives you monthly payouts only up to age 90, while CPF LIFE—as the name suggests—pays out for life.

Given that 1 in 3 Singaporeans live past 90 years old, this makes the Retirement Sum Scheme much less attractive than CPF LIFE.

The caveat for CPF LIFE is that you have to pay a significant lump sum premium from your Retirement Account when you join the scheme (any time from age 65 to 70). This will restrict your ability to use your CPF funds for other purposes.

To calculate your exact CPF LIFE payouts, you can use the CPF LIFE Estimator to check how much you can get. Or, read our tome on CPF LIFE: Monthly Payouts, Plans & Minimum Sums.

 

What if I can’t meet the Basic Retirement Sum?

If you can’t even meet the Basic Retirement Sum, your situation will be a little different when you turn 55.

$5,000 or less: For those who have $5,000 or less in their entire Retirement Account, you can withdraw the entire amount when you turn 55. You will not receive any retirement payouts, so you should hopefully have done some retirement planning on your own.

More than $5,000, but less than BRS: You will be allowed to withdraw $5,000 when you turn 55, and that’s it. You will then wait till you’re at least 65 to receive CPF LIFE payouts, which will be pro-rated based on how much you have in your account.

More than BRS, but less than FRS: If you own property and have pledged it, then you can withdraw any savings above the Basic Retirement Sum. Otherwise, you will only be allowed to withdraw $5,000. 

You do not need to top up your account to hit the Retirement Sum. But if you receive any new CPF contributions or top-ups after age 55, the money will be kept in your CPF until your balance meets the next Retirement Sum.

So if all else fails, there is one final solution—continuing to work past age 65 and delaying the onset of your retirement payouts, so you have more time to accumulate your desired Retirement Sum.

 

How do I start saving for my future CPF Retirement Sum?

If you’re some way off being 55 and have done the maths, the projected CPF Retirement Sum in the future might be pretty scary!

Going back to the above example: if you’re now 35, the estimated Basic Retirement Sum would be $196,979.85 while the Full Retirement Sum is $393,959.70. That can sound like a hefty sum if you have limited earnings power.

On the other hand, compound interest can be a powerful thing, particularly over a long period like 20 years. There are a few things you can do right now to set you up for a much better chance of hitting the Retirement Sum you need.

Transfer funds from OA to SA: You can transfer Ordinary Account savings to your Special Account to boost interest from 2.5% to 4% p.a. The transfer is one-way, though, so only do it if you’re certain you won’t need the OA money for housing.

Retirement Sum Topping-Up Scheme: Top up your Special Account in cash. You can get tax relief for up to $8,000 a year for doing this, up until you hit the current Full Retirement Sum. Again, make sure you really don’t need the cash in the short- or medium-term since it will be locked up for a while.

Invest your cash (outside of CPF): We recommend investing as a complement to (not a replacement for) CPF. Cash investments can be sold, so you have some wiggle room in case of future contingencies.

Compared to CPF’s risk-free returns, these investments all carry much higher risk of loss but also, over the long term, much higher potential returns. 

You can keep the risk level down by investing for the long term and focusing on unsexy, globally-diversified investment instruments such as ETFs.

With many low-cost robo advisors and investment brokerages to choose from, it’s easier than ever to start investing. Here are but a few popular ones.

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