The CPF Minimum Sum (MS) is the amount a member has to set aside in his or her Retirement Account (RA) for retirement needs. The RA is set up when a member reaches 55 years of age, drawing from savings in the Ordinary and Special accounts (OA and SA respectively). During retirement, the savings accrued in the RA will then be disbursed monthly to the retiree.
At present, the MS is set at $117,000. It will rise to $123,000 with effect from 1 July, as reported in the news recently. CPF members are allowed to pledge property that was bought with CPF funds toward the MS, with the value pledged capped at 50 per cent of the MS.
According to the CPF’s web site, the property pledge for the CPF MS at age 55, has been changed to the following: “If you are unable to set aside your full Minimum Sum in cash, your property, bought with your CPF savings, will be automatically pledged for up to half of the Minimum Sum”.
The important thing to note with this rule is that if the shortfall is less than half of the MS (or $58,500, at the current level), the remaining value of the property ($58,500 less the MS shortfall) becomes irrelevant.
This is different from a previous “property pledge” rule, as seen in this 2003 CPF Board press release, which allows members to choose to pledge their property for up to half the MS.
Under this rule, members who are unable to meet the MS are allowed to pledge their property for up to the full 50 per cent of the MS – rather than just making up for the shortfall. Therefore, if their MS shortfall is less than the 50 per cent of the required amount, the remainder from the property pledge would translate into funds available for withdrawal.
Here’s an illustration. Currently, in the example given in the new CPF booklet “Reaching 55”, a person with $100,000 in the CPF Ordinary (OA) and Special Accounts (SA) can withdraw 30 per cent, which is $30,000.[1]
Under the new “property pledge” rule, the MS shortfall of $47,000 (current MS of $117,000 less the $70,000 retained in the RA) will automatically be pledged with property.
Under the old “property pledge”rule, this person would have been able to pledge the full 50 per cent of the MS, which is $58,500. This means he or she would be able to withdraw $41,500 (from the $100,000 in his or her OA and SA, less $58,500), as compared to just $30,000 under the new rule.
Another implication of this new rule will take effect in 2013. For members who turn 55 on or after 1 January 2013, the CPF cash balance can only be withdrawn after setting aside both the CPF MS and Medisave Minimum Sum. If this is not met, they can withdraw only $5,000 from their CPF account, regardless of any property pledge.
With the MS in 2013 being likely to be $135,000, assuming the current rate of increase of $6,000 per year remains constant, there may be more people who will face an MS shortfall when they turn 55.
Furthermore, since February 2009 , property sale proceeds must be retained in the RA if there is a shortfall in the MS. In some cases, where the member’s MS shortfall is too great, the property sale proceeds retained may be even more than 50 per cent of the MS. Part or even all of the net sale proceeds may not be available for the member to buy another property.
The view that one’s HDB flat is an asset enhancement – something one can monetised for retirement – may increasingly become less valid, with the MS increasing every year.
Given all the significance this “property pledge” rule change has on CPF members, it should be asked as to why there was no announcement made in Parliament or to the media?
To be sure, even the previous CPF booklet “Reaching 55” (attached) covering the period 1 July 2009 to 30 June 2010 showed the new “property pledge” rule.
So when exactly was this rule changed?
[1] The booklet states that “the figures here apply to members who turn 55 from 1 July 2010 to 31 December 2010”. I believe that this is because the Medisave Required Amount (MRA), currently fixed at $22,500, is scheduled for its annual increase on 1 January 2011.
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CPF BOARD suck us dry at this age 55 and still increase the amount everytime without our permission. Next time get our approval first before releasing in the newspaper
Ask around, how many will be able to withdraw anything at age 55? Most of my sibling says No, nothing, zip, zero.
Perhaps they are being conservative, but they are holding executives/manager positions, so what about the average Singaporeans?
Amazing that people are moved to ‘rebel’ against SingTel,Starhub while allowing the PAP Blood Suckers to continue to deny Singaporean their hard earned savings/monies.
VOTE AGAINST PAP.
GET CONTROL OF YOUR MONEY.
GET CONTROL OF YOUR LIFE.
i hav often says this problemo will never STOP!!! in leekuanyew’s eyes..he is a bloomin TYRANT!!! your cpf is mine and hoching to be used…
~PERIOD~
what can you poor peasants do? le miserables with a changkol?
nah nah nahnia…
Its very very sad indeed PAP resorts to such blatant crocked and high-handed way to treat Singaporeans, especially those a couple of years away from age 55.
And unknown to the public (fck opposition sleeping away on this cpf withdrawal matter, which I think is a very Good ammo for them), there ware many many blatant changes which GONE UNREPORTED and UNHIGHLIGHTED anywhere in the media !!!
Previously I mentioned before when the min sum was established, NO-WHERE in any of the literature on MS over many years, was it mentioned the MS is ‘in today’s dollars.
Then bastard PAP slowly and unknowingly began to introduce many many unpleasant changes quietly bit by bit, and Singaporeans SLEPT THROUGH.
They will continue to pluck you people through and through as long as they stay in power while rewarding themselves with millions out of the taxpayers. So, if you people still think and believe what these white crooks time and again. then you don’t complain anymore. For others, you just have to boot all these white crooks out asap.
Woa. so this is another silent hunter/killer tactic to implement another scheme to suck us dry. Hey, why don’t they just say that CPF will be untouchable until 3-gen later…oh….i know…singaporeans will be ok with our life been suck away gradually, but not ok with it been done in 1 shoty
the biggest risk of CPF is that the rules can suddenly just change to whatever without you knowing.
think about it, if it was an opt in fund for long term investment, with this anyhow changing rules without your consent, would you put in your money in there?
alas, CPF is compulsory we cannot so anything about it.
As mentioned in this article, the CPF has changed things.
This means clearly that CPF is not carved in stone.
Change can happen overnight, imho, but change can have many reasons. One of these could be change of Leadership.
Those who want change can try do something to bring forward the Change. Technically speaking.
Should TOC do a special on the views of new citizens on this thingie that keeps shifting the goal post?
The increase in min sum has affect my planning.
They should have informed us much much earlier.
How can like this? For Every concerns felt by native true blooded citizens, we should ask for the comments of the new citizens, in case they not aware these concerns exist.
The truth of this minimum sum scheme is that the PAP government had lost billions in investment handled by GIC and Temasek that they cannot pay to all retirees on reaching age 55 their lump sum. So they deviced this sum so as not to pay them one lump sum at 55 but a few hundred bit by bit every month giving them a small interest gain. Imagine if the retiree can invest the one lump sum by himself he can at least 30% in return. PAP is therefore cheating on the old folks through this min. sum scheme another scheming scheme at cheating!
Please, please, please.
Don’t say u cannot do anything. Tell ur friends, tell ur families.
Take Control of your Money.
Take Control of your Life.
Vote PAP OUT.
Like that, what incentive has the self-employed to report their earnings truthfully when at the end onerous rules means what goes in cannot come out ?
Surely the inevitable is more cat & mouse games & creative reporting by the self-employed.
After all, who can blame them when the restrictive retirement scheme are NOT in their best interest ?
we should go for a referendum whereby we vote for permanent set of rules for CPF and retirement.
not for the gov to change any time and at it’s whim.
they will robbed us blind of our money in CPF if nothing is done right now.
There are more rules that CPF did not publicize. I only knew it when the CPF frontdesk guy told me. The govt only interested in your Minimum Sum after age 55 and anything amount after that, CPF will try to hijack it(ie to keep those after 55 from getting it).
When a couple contribute equally to HDB loan and if the flat was sold when both are under 55, they apportion your sale proceed and return back to their CPF account the amount which they had loaned from CPF with interest. So if the couple loan $2ook(include interest) each to paid HDB for 20 years, n later if sold the flat for $300k, though a loss, CPF will returned back $150K each to their respective account. Now the problem is if for example the husband is over age 55 and already have the satisfy the MS, if the flat is sold, the CPF will not apportioned the sale proceed but rather, the CPF board took $200K from the sale proceed and returned it back to his wife CPF acct leaving only $100K for the husband.The CPF reasoned that as CPF had his MS, anything more than that he could took it out in cash.But knowing that if CPF apportioned the sale proceed equally, the guy will get $150K cash so CPF claimed that since the man need not return the loan back to CPF (age over 55), than the sale proceed should paid back all his wife CPF loan and remainder cash is up to the couple to decide. What the fart! Both contribute equally, but refuse to apportion equally bcos one of them is over age 55! Just imagine if the sale price is say $200K, then the guy got nothing instead of $100K. I dun believes the rumours that CPF will think ways n means to “kidnap” our saving,but with this case, I am sure now that the rumours are absolutely true. Now gonna know what to do this coming election..three votes in my family…. :)
it is clear:
they hog your monies because they cannot pay you.
they make you pay them instead.
This contradicts the original design of the CPF under GKS.
if everything is working well under gks’s rule, why change it?
if you save 40 years and they cannot pay you, what makes you think they can pay you later with cpf life?
it is cheaper to just change a rule than to work the ass out to produce a real service and lhl is only good at changing rules for himself.
it is cheaper to just change a rule than to work the ass out to produce a real service and lhl is only good at changing rules for himself.
This CPF thingy is an absolute exploitation of human rights in Singapore. It is totally unacceptable for people who have no rights in our savings, meddle with it and even tweaked it without our approval. CPF law = PAP law, under such defintion we are doomed and Singaporeans will have no money for old age. I can’t imagine Singaporeans when they reached the age of retirement with money in the CPF savings, still seen picking cans and carton boxes in the street. I wonder how does PAP ministers sleep at night when the people sleep in the street with money in CPF controlled by PAP.
Fear tactics has always worked here. People dare not vote against the ruling party because of fear. Fear that they and their children will be marked.(not so effective lately. Fear that their estates will become a slum and thus their property value will drop. Fear that the the economy will fail and moms, wifes & sisters become maids overseas. Well its about time the opposition used the same tactics. Instill fear in the people that all their savings in the CPF is being taken away, that the HDB houses have only paper value, that our billions are being lost by brilliant lady. Instill fear that we their children will become labourers in their own country, that their children cannot afford homes. That the country is being overtaken by foriegners. Soon we will have super rich foriegners staying in Sentosa,Marina & Orchards.
Reply to MyviewareevenBETTER’
I can do something about my CPF when i become a citizen of Philippines living in CEBU.How about you Jack?
Perhaps the government just want to ensure that locals can survive upon retirement where most barely had any savings nowaday
preston loon 24 May 2010
Reply to MyviewareevenBETTER’
I can do something about my CPF when i become a citizen of Philippines living in CEBU.How about you Jack?
…………………..
but you are NOT?
you are too bloody a coward..a sheltered coward i should says…
i just came back from cebu…not onced..not twiced..so many times that counts almost ran ut of fingers..
Moneymad 24 May 2010
Perhaps the government just want to ensure that locals can survive upon retirement where most barely had any savings nowaday
…………….
perhaps your bloomin head…
why do healthy peasants @ above 50s commit bungeless jumpin from hdb flats fullypaid..leavin their 70 years ole parents behind? to avoid the parent maintainance acts perhaps?
That the country is being overtaken by foriegners. Soon we will have super rich foriegners staying in Sentosa,Marina & Orchards.
…………….
worst still..your mother/sister would hav to be their maids..your father would hav to be their drivers..
and your grandparents hav to stay outside their condos awaitin or rumbblin thru their grbadges for a leftover decent meals…
This CPF is better than Dracula and the jumping vampires in Chinese show. My money and I cannot take it out even after 55.
This is sign that Temasek under Ho Ching has lost so much money that Singapore probably do not have much cash now i.e. most money got stuck in REAL “paper losses” that this Ho Ching thinks is only paper loss.
PAP government linked companies like Temasek Holdings headed by Ho Ching and GIC headed by MM Lee had borrowed heavily from CPF Fund and made huge losses of more than S$58 billions Singapore dollars in bailing out US banks and speculative tradings especially in 2007. So need to constrain local citizens from withdrawing their CPF monies.
Better still if our citizens die intestate and the whole of their assets including CPF monies will belongs to the government and also to sustain the multi-millionaires PAP ministers pay and increments.
It’s a wake up call to us to break through from their evil crutches.We’ve been hypnotised by their cunning manouvering tactics for decades and time has dawned on us to take up the cudgel to get our rights back.Never again believe in their sinister or hollow speeches or we’ll be doomed.
Hey fpc:
You are spot on.
Uncle Leong wrote on this CPF Life thing some months ago, at this very site TOC – u do a search and could locate it.
Indeed, there is NO GUARANTEE that CPF life Fund will be solvent. And this Gan already said very very clearly in reply when Halimah raised a question IN PARLIAMENT why CPF Life payments ARE NOT Guaranteed. Halimah questioned, ‘how come, this is not a commercial contract (and even commercial contracts can have guarantee), how come as a government CANNOT guarantee’.
You know WHAT Gan answered, ‘be rest assured’, haha really serious that was his repy. And you know of late, ONE INDIAN Minister said, “this is a government of trust”
So guys – tan koo koo IF CONTINUE to vote for pap bastards!!!
The only long term solution for Singapore is to have a two-party political system.
Singaporeans must realize a one-party system is authoritative and favors one class! It is always the average people will be short changed!
http://www.youtube.com/watch?v=W1Y_tfHOZT4
The whole revised CPF withdrawal scheme will become a sort of monster nightmare to many of us, courtesy of PAP.
Just imagine CPF as our National Savings Bank, telling its depositors that they can’t withdraw their savings in full at age 55 but withdrawal will be deferred only with monthly payouts starting at age 65.
If you happen to die between 55 to 65, you don’t even have a chance to smell your hard earned savings and good luck to you, thanks again to PAP. Why force this destined age group to leave their minimum CPF sum to their heirs ?
I think this must be the most restrictive and unequitable policy implemented by PAP as it seems to penalise those whose lifespan is between 55 & 65.
Can we ever forgive PAP for implementing such a damn policy ?
The thing is, how can they pull a straight face when they know that money which is our money, by the billions is lost through bad investments and we see no one being accountable. In all my years of voting I’ve always voted against the PAP. I got over that fear thing many many years ago, it was just a psychological / social thing employed by the PAP. Have we gotten worst off, no. But if we do not do it this time at the next election, we will be done for it for a very long time to come for us and our children. There is no more point postulating about what they did wrong or screwed us etc, just vote against the PAP no matter who the opposition is in your area, even if it was Chee and his sister. I think we all will be far better off. Be brave people and put that fear thing behind you.
THe more we look at the WEST,the more we are convinced that force saving scheme like CPF is justified.Singapore and Greece hold some similarities.Both countries have no natural resources and its main source of revenue is mainly based on Tourism.However,I am in agreement that payout portion to retired citizens should be harnessed and should be a bit more generous.Having said that,we must be thankful we do not have a Greek government running Singapore.For those who are feeling insecured about their savings in that scheme,my only advice is to migrate to another country.Also,a word of caution:Do not hold too much grudges against PAP in your heart as one may die of a heart attack,thus never to see any of your hard earned monies.Take care.
preston loon 24 May 2010
Do not hold too much grudges against PAP in your heart as one may die of a heart attack…
……………
so you aint migratin to cebu @ all?..what are you waitin for? ronaldo to hold hands together..by the way..who guranteed you that you will lived beyond 62?
Reply to myviewareevenbrighter,
If i drop dead before age 62,my next of kin will inherit whatever i have in the CPF account.Wherever i go my family will follow.Once they become citizens of Philippines living in Cebu,my family will withdraw every cent from mine and their CPF accounts and then live happily ever after.
If your views are brighter,please tell us about your plan.Perhaps your plan could be better than mine.
preston loon 25 May 2010
If your views are brighter,please tell us about your plan.Perhaps your plan could be better than mine.
……………….
me plan? preston oleboi.. i already HAD a PR in britain..liked i said before..i come home a periodical son and will die in singapoor amon my/our peasants..riched or poor dosen’t matter..
my other siblins are in thailand/cebu/ & china…
i hav so many options to become a quitter yet i came home…
and you are the same DAMNED idiot amon all other pap idiots to tell me to farkoff if i am not happy with the pap governors…even in THAILAND which is a KINGDOM do NOT resort to such selfish act of parliaments..do you see thaksin did that when he was in power?
preston loon 25 May 2010
If i drop dead before age 62,my next of kin will inherit whatever i have in the CPF
………………
right and you believed all the mumbo jumbo with cpf inheritances right?
the day my belated pop passed on..the day i withdrew all his $avin$ via net atm..after the funeral was over..i went to cpf board in tampines with FULL documents with his hole in the IC and the certifiable government death certificate..you know what? cpf board tell me my belated pop account hav a NIL balances..so no free money for me @ all
i asked cpf board to printout his statements and willin to pay the $15++ and cpf board hav the audiantycity to challenge me NIL balances no printout..you no happy take us to court
no..not the furniture seller again..my belated pop used a coffin..not a recycled wardrobe…
i posted the same comment in youngpap forum..none of the socalled bloggs MPs dared to rebuke me @ all…they socalled grassroots also dared not challenge me that this sort of strongarm tatics even existed @ all…
you do know how much money i must settle in court just to fight for my rights?
$100? $1000? try $20,000 and above…
Abolish CPF.
It’s your own money, manage it yourself.
ridiculous extreme :(
CPF is getting as complicated as taxi charges. If you do not may a trip to CPF office,you will never understand CPF withdrawals etc. Unlike the good old days when you reach 55, you can withdraw the whole amount and do what you always dreamed about.
I am just wondering what the Government or CPF is doing with our money forcefully withheld under minimum sum, special account, medi-save etc.
Does CPF Board publish an annual report on what it does with the withheld sums/investment besides reporting on amount withdrawn for housing etc.?
Who knows – by the time you reach age 55, they might tell you that the withdrawal age has been increased to 60.
CPF rules are constantly changing. You never know – they might even declare an interest of 0% one fine day.
I wrote to the Manpower Minister (who is incharge of CPF Board) n he redirect my email to the CPF senior management. When they can’t answer my question (they keep quoting “It’s company policy”), I wrote to the Monister gan again with all the attached email.KNN..til now he not even reply to my 2 email to him…only ways I can think of to solve these problem is to get these unproductive elites out is to vote PAP out!
I think before 2013 when this new ruling taking effect, the CPF board will come up with something again to make it even harder to withdraw our $$$ again. Don’t forget they still have the so call CPF life scheme in their bag. And it will be made compulsory. Wait until the next GE and see.
CPF is our own money. The Govt of the day has no right to withhold any money.Over the years, many changes had been made to “withhold” or “suck” your CPF money such as Mimimun Sum, high HDB prices, high medical costs, high costs of living,etc. In Singapore we overpaid for eveything, including you know what! No MP dare to vote against when changes to the CPF was implemented. Every changes would just be steamrolled. This is not true democracy and the people’s voice is not articulated. Perhaps it our own doing as people voted for it with resounding majority and should keep our mouths shut! Do we want all those rules that goes against the wishes of th people be implemented under the guise of looking after the “welfare” of the people. This is unhealthy. If the MPs does not speak up for the people, it should be changed. A we want change when the next GE comes.
if your owe gahmen money and if you die
they will dig your grave and make you stand in court of law. if you fail to turn up in court within 14days from the day you died then warrant of arrest will be issue against you. you will be charge in court and face imprisonment not less then lifetime in jail sentence. you will then be reburied after you serve the jail term if only you PAY FOR YOUR GRAVE!
singapore new law.
I want my hard-earned CPF money back at 55. It is my hard-earned, sweat and tears money. Give my money back to me, you money-grabbing robbers.
felt so robbed?
Many years ago – in the 1980s, an article in one of the finance magazine calculated that the CPF board do not have enough money to pay out to their customers. The magzine was not sued nor curtialed in their circulation. Now you see the consequences – CPF will try by any means to ensure you will never be able to withdraw your money, cause the minimum sum will keep rising and your only asset that you can monetized will be capped. We deserved the government we voted in..
WTF work so hard until 55yrs cannot get our own money!! Treat us like kid at that age ha???I hope you will lose the election PAP then maybe we can get to taste the fruit of our labour!!