Martin Lee @ Sg
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CPF Life Second Auto-Inclusion Point

CPF Board recently came up with a new second inclusion point of $60k at the draw-down age (DDA) for the CPF Life scheme.

CPF lifeThe DDA is the age at which members are allowed to withdraw their CPF savings in the form of monthly payouts. The DDA for members who turned 55 from 1999 to 2004 is 62. This has been gradually increased to 65 for those who turned 55 in 2009.

Previously, only CPF members born in 1958 or later with at least $40,000 in their Retirement Account (RA) at age 55 will be automatically included in CPF LIFE with effect from 2013. Those with less than $40,000 will not be automatically included at 55.

To help these members participate in CPF LIFE and enjoy an income for as long as they live, members will be automatically included at DDA if they have $60,000 in their RA then. This might happen because some members may subsequently have significant RA inflows between 55 and the DDA.

This latest move by the CPF Board will increase the pool of people in the CPF Life scheme as it will now be able to “compulsory acquire” people who did not had $40k at 55 but had $60k at the DDA.

Leave a Comment:

Intheknow says 13 years ago

lion, eagerly waiting for your advice.. thanks!

    lioninvestor says 13 years ago

    Hi intheknow,

    will be posting it over the next couple of days.

Intheknow says 13 years ago

please have illustrations for poor, normal, and rich people.

if possible, please have at least these 4 levels.

Hit retirement age with:

1. Total SGD20k CPF

2. Total SGD100k CPF

3. Total SGD500k CPF

4. Total SGD2million CPF

what really happens then?

Intheknow says 13 years ago

thanks.. looking forward to that post.

“No matter which option you choose, you will get a monthly payout (either from CPF life or from drawing down of your RA) starting from the same age.”

this is what pisses me off…

i want to have as little tied up in CPF as possible, and i want to withdraw all amounts above my minimum sum when i hit my retirement age…

Intheknow says 13 years ago

you sure that is how it works?

i don’t think so.

are you saying if i have sgd 5 million.. say minimum sum then is 200k, i can withdraw sgd 4.8 million in CASH? don’t think so.

my belief is if i have sgd5 million and minimum sum is 200k, i must dump 500k into the lowest tier cpf life, keep 200k in minimum sum, and only get to withdraw sgd 4.3 million in cash.

and from the PDF link i attached, i am sure if i choose the minimum tier of CPF life, i will only get my payout from CPF life when i am 90 years old.

for once, i really hope to be corrected…

anyone know the exact procedure?

    lioninvestor says 13 years ago

    Hi intheknow,

    I will address your questions in a separate blog post so that more people will be able to benefit from it.

    No matter which option you choose, you will get a monthly payout (either from CPF life or from drawing down of your RA) starting from the same age.

Intheknow says 13 years ago

lion, your calculator only for people born before 1959.

i managed to find some scant details on CPF website..

Page 6.

if choosing the lowest tier scheme, about 10% of your ENTIRE CPF BALANCE goes to the CPF LIFE scheme.

this is ridiculous, they go by % rather than by amount…

so if i am a savvy investor and i accumulate 5 million in my CPF when i retire, they are going to force me to dump at least 500k into the CPF LIFE scheme??

and i only start getting annuity payments from my 10% AFTER i am 90.

i was under the impression that it was an absolute amount, but it seems to be percentage…


looks like yet another reason for me to migrate before i retire!


    lioninvestor says 13 years ago

    Hi Intheknow,

    You won’t need to put 10% of 5 mill into the scheme. After setting aside the Min Sum, you can withdraw the rest of your CPF monies.

    The age 90 is a bit misleading as the payouts will start from age 65 (from the 90% of the money).

    So, no matter which scheme you choose, the payouts will start from 65. That table can mislead a lot of people into opting for the scheme which leaves little to their beneficiaries.

Intheknow says 13 years ago

Hi Everybody,


for example, if i have SGD200k in my CPF accounts when i retire, how much will be ‘deducted’ from my CPF balance for the cpf life?

i can’t seem to find this figure anywhere at all!?!

Intheknow (guess not in the know this time)

    lioninvestor says 13 years ago

    Hi Intheknow,

    when you buy an insurance product, there is a benefit illustration. The amazing thing about CPF life is that there is none.

    The amount you need to set aside in your CPF account depends on the minimum sum prevailing when you reach 55 (you withdraw the rest).

    You can try the calculator here which tells you how much of that balance will go into the CPF life scheme (click on “details” and then click on more “details” again).

    And at the end, there is a footnote which says that this amount is an estimate. ๐Ÿ˜€

James Tan says 13 years ago

Hi Lion,

This news comes shortly after your earlier comments on 12 Mar… Look at the figure quoted… $40K… Seems familiar???

Yeah, all policies work “hand-in-hand”. You cannot take out the first $40K in your SA, so chances are, most people would “qualify” for the CPF Life scheme… because more people would have $40K “locked” in their SA. I can tell you, within the next few years, the “lock-down” amount may increase yet again…

When I saw this, I was grumbling… Why can’t I be trusted to look after my own money?? Then you need to understand, not everyone is as savvy in investment.

Just look at those investors who got the mini-bonds and Lehman Brothers issue… I swear I see even some of my ex-colleagues who were shouting for compensation, even though they are seasoned investors… ๐Ÿ™‚ So, for the general “good”, our government has no choice but to restrict withdrawal.


    lioninvestor says 13 years ago

    Hi James,

    Actually, both the news came together. Just that I broke it up into two separate posts.

vslingam says 13 years ago

I think the CPF Board is concerned that the number of signups for CPF Life is below their targets. For the CPF Life scheme to be viable and successful, it needs a large pool of investors.

Many of the older folks are not interested in the scheme, though they may have the financial means to invest. Hence, this is one way to subtly include the marginal cases – ie ppl who otherwise would not have signed up.

In any event, those born before 1958 will not be auto-included.

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