October 12, 2021

Categories: Savings

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When you turn 55 years old, a Retirement Account (RA) will be created using savings from your Special Account (SA) and Ordinary Account (OA) to form your retirement sum. Your retirement sum will provide you with a steady stream of retirement income where you can receive monthly payouts for as long as you live.

You may already know that the remaining amount in your Special and Ordinary Accounts can be withdrawn anytime from age 55. While withdrawal is an option you can exercise, why not consider stretching the value of your savings by keeping them in your CPF accounts! In fact, you can also make cash top-ups to your CPF accounts to further boost your retirement fund. How is that so? With compounding interest, your little nest egg will grow over time so you can have more to enjoy in your golden years.

Here are three ways to top up CPF after reaching age 55:

  1. Top-ups Under Retirement Sum Topping-Up (RSTU) Scheme: Use cash to top up to Retirement Account to meet the current Full Retirement Sum. 
  2. Returning The CPF Monies You Withdrew For Property Purchase: If you have accumulated some extra cash, do consider paying back what you have used for your property purchase into your CPF account; without having to sell your house. This will help you to further fortify your nest egg and benefit from the power of compounding. 
  3. Voluntary Contribution (VC): Amounting to the difference between the CPF Annual Limit of $37,740 and the mandatory CPF contributions for the year; to be made to your Ordinary, Special and MediSave Account OR solely to your MediSave Account.

Yes, these suggestions all revolve around one core idea, which is to keep more money within CPF at retirement. Even when you enter your golden years, you can continue to utilise the magic of compounding interest and continue to build your wealth for the future.

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