CPF Minimum Sum to be revised upwards to $131k

the cpf minimum sum will be revised upwards from the current $123k to $131k effective july 01, 2011.

this new minimum sum will apply to CPF members who turn 55 from July 1 2011 to Jun 30 2012 and for those who can set aside the minimum sum in full in cash, can apply to commence monthly payouts of $1,170 when they reach their draw down age.

in the same announcement by the cpf board, there is also another increase for the Medisave Minimum Sum which will also be raised to $36,000, up from $34,500 previously, whereby members will be able to withdraw their Medisave savings in excess of the Medisave Minimum Sum at or after age 55.

and the maximum balance a cpf member may have in his Medisave Account, also known as the Medisave Contribution Ceiling (MCC), is fixed at $5,000 above the Medisave Minimum Sum and this will be increased to $41,000 from july 01, 2011, up from $39,500 previously.

should there be any Medisave contribution in excess of the prevailing Medisave Contribution Ceiling, it will be transferred to the cpf member's Special Account if he/she is below age 55 or to his/her Retirement Account if he/she is above age 55 and has a Minimum Sum shortfall.

my comments:

the jump in the cpf minimum sum is perhaps not too surprising, given the fact that inflation over the past 12 months have been pretty high compared to the period of low inflation especially after the global financial crisis of 2008.

i reckon that the majority of cpf members will probably not even have met the specified minimum sum, as well as the medisave minimum sum as well.

that is why retirement planning or the lack of it is still pretty prevalent amongst consumers here in our tiny red dot nation.