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An Introduction to CPF Life Thumbnail

An Introduction to CPF Life


The following section is a review of information provided by the CPF Board on the CPF Life website. Specific information for your accounts may only be verified by CPF, so numbers here may vary.

1. Overview

CPF Life stands for Life Income For the Elderly. It was fully launched in 2013 as the culmination of previous efforts to setup lifetime pensions for retired persons in Singapore. If you are Singapore Citizen or Singapore PR you are eligible for the plan.

2. How it works

CPF Life starts at 55 years old, when a retirement account is formed from the combined sums taken from standard CPF accounts. This retirement account is earmarked for the CPF Life program, and at 65 will be inputted to the life annuity run by the CPF Board. 

3. Choices You Have With CPF Life

Choice 1 – Account Type

There are currently 3 different account types within CPF life. You choose your account about 6 months before you turn 55 (CPF will contact you for your choice). Each account focuses on different benefits, though all of them provide lifetime income:

  1. Standard Plan – ‘More For Self’, allows for higher monthly payouts for your life, but leaves less of a bequest for your loved ones.

  2. Basic Plan – ‘More For Loved Ones’, allows for more bequest to be left to your loved ones as a lump sum, but leaves less monthly payouts for your while you are alive.

  3. Escalating Plan – ‘More For Future’, starts your monthly payouts lower, but increases them annually for your entire life to help pace inflation.

Choice 2 – Account Value

The amount of money that you are paid each month in retirement depends on the account type, but also the account value. CPF has 3 target value levels, each one increasing the amount of money you are paid when you retire.

2020 VALUES 

Basic Retirement Sum SchemeFull Retirement Sum Scheme
(x2 Basic Sum) 
Enhanced Retirement Sum Scheme
(x3 Basic Sum)
Retirement Account Amount@ 55 SGD 90,500     @ 55 SGD 181,000     @ 55 SGD 271,500

The amounts above are based on the current 2020 retirement sum scheme, each year the amounts may increase to keep pace with inflation, thus the minimum needed for each account will increase.

The combinations Account Type and Account Value can be seen on the CPF Life Estimator Calculator available online and provided by the CPF Board.

4. Retirement Account

The Retirement Account (RA) is where you savings are stored for CPF life from 55 onwards. The proceeds for the account come from your OA and SA accounts. From 55 onwards you still save into your OA, SA, and MS accounts. There are rules on topping up the RA from these accounts or with cash, in order to increase your final CPF Life Retirement amount. This can help you increase your savings by using the CPF system and ultimately increasing your monthly retirement income.


The following are specific points that were reviewed based on the questions that have been asked frequently.

1. Can CPF Life be joined after 55? (Important for PRs)

According to CPF, yes, pending approval of application from CPF Board. You would need to top up your CPF accounts. As topping up would be significant, you would want to consult with CPF Board about the procedure. Tax relief would only be available on a small portion of the investment.

2. Can CPF Life be exited? (For PRs giving up PR status only)

Per CPF, yes, you can withdraw the money from the program. This can only be done if you surrender PR, or other very special circumstances. If you withdraw, you will not be given an accrued interest. Also, if you withdraw after the annuity has started, you will not get back paid premiums, and your amount may be affected by the surrender, just like a regular annuity. The Board would give you estimates at the time you withdrew.

3. Are CPF Life Payments taxed?

According to the IRAS website, no they are not. They are exempt from taxation for Singapore. If you live in another country during retirement this may not apply as different countries have different rules.

4. Are CPF Life payments guaranteed?

No, they are not guaranteed. The life annuity is managed like any other fund, and while it is done conservatively, the Board has published that there is not a 100% guarantee that payments will always be the same amount.

5. Can I change my Account Type once I join it?

According to the website, you have 30 days to change your plan once you enrol. If it is passed this date, then please check with CPF directly if anything can be done.

6. Can I move money from my OA account to my SA account?

Yes you can move money between the accounts. This allows you to increase the amount of savings in SA account, giving higher interest and more for retirement. The drawback is once you move money to your SA account it has to stay there (unless utilizing the after 55 withdrawal rule). Please review this action with CPF before committing any movement.

7. Can I withdraw money from CPF?

At 55 years old you have the option to withdraw money from your CPF account. The guidelines for this vary depending on your account, but the following are the major points:

  • If you have less than SGD 5,000 in your ordinary and special accounts, you can withdraw the full amount.
  • If you have over SGD 5,000, then you have to first meet your basic retirement sum (see earlier pages).
  • If you have over the basic retirement sum, or you chose a higher version of CPF Life, then this forms the base of your CPF account.
  • Any amount over your retirement sum can then be withdrawn from your Ordinary and Special accounts.
  • Your Medisave account must stay in place. Once you hit the Medisave cap, money is automatically shifted to your other accounts. This is to pay for the premiums of Medishield Life.

8. If I surrender PR, can I keep CPF Life?

According to an email confirmation from the CPF Board, you can currently keep CPF life if you are already in the program if you surrender PR. The details of this are specific, so before you surrender PR please consult with the CPF Board directly.

Please check with CPF directly to confirm the information above, confirm values and amounts, and to review any actions you may take. CPF representatives have the final say on what you are able to do with your account.

9. US Taxpayer?

CPF is not a qualified pension per the IRS, CPF requires annual reporting on your 1040. The employer's contribution to CPF is included in annual income while the employee's contribution is not eligible for the Foreign Earned Income Exclusion. Interest earned is reported as interest income on Schedule B. CPF may require reporting on your FBAR  and IRS form 8938 depending upon your personal circumstances.

This material is intended for educational and informational purposes only. It is not intended to provide specific advice or recommendations for any individual. Additionally, you should consult with your Financial Advisor, Tax Advisor, or Attorney on your specific situation.  The views expressed in the material are that of the author and do not necessarily reflect those of any market, regulatory body, State or Federal Agency, or Association.  All efforts have been made to report or share true and accurate information.  However, the information may become materially outdated or otherwise rendered incorrect due to subsequent new research or other changes, without notice. The author nor the firm are able to always verify the content from third party sources. For additional information about the firm, please visit the MAS Website at https://www.mas.gov.sg/  and the SEC Website at www.adviserinfo.sec.gov.  For a copy of the firm's ADV Part 2 Brochure, please contact us at info@avriowealth.com