Several CPF scheme changes were approved in 2015 and just came into effect in 2016. Here are the most significant changes that you must be aware of.
1. Increased salary ceiling from $5,000 to $6,000.
2. Increased CPF contribution rates:
|Age||Change in employer contribution rate||Change in employee contribution rate|
|50-55||From 15% to 16%||From 18% to 19%||55-60||From 12% to 13%||No change at 13%|
|60-65||From 8.5% to 9%||No change at 7.5%|
3. Increase of 1% interest rate to 6% on first $30,000 of CPF savings for members over 55 years.
4. Change in retirement sums required to $80,500 for property owners and $161,000 up to a maximum of $241,500 for non-property owners.
5. Additional withdrawal allowance of retirement savings account at 65 up to 20% of retirement account (includes existing $5,000 withdrawal allowance at age 55).
6. Option to defer CPF Life payouts up to age 70. For each year deferred, members will have an increase of 6-7% increase in monthly payouts.
7. Option to transfer CPF savings above the Basic Retirement Sum ($80,500) to spouse’s CPF account. This is to allow your spouse to enjoy the additional interest paid on the first $60,000 of combined CPF savings.
8. There is no longer a need to top-up the Medisave Basic Healthcare Sum (previously known as the Medisave Minimum Sum)