What happened?
As part of Budget 2024, Deputy Prime Minister Lawrence Wong announced several key changes to the Central Provident Fund (CPF) system.
Remember CPF SA shielding? This will no longer be applicable as the CPF Special Account (SA) will be closed when CPF members reach 55 years of age.
Read on to learn more about CPF retirement sums – Full Retirement Sum (FRS), Basic Retirement Sum (BRS), Enhanced Retirement Sum (ERS), and find out what this change to the ERS may mean for you.
Understanding CPF Retirement Sum
What you need to know is that there are three categories of CPF retirement sums.
They are:
- Full Retirement Sum (FRS)
- Basic Retirement Sum (BRS)
- Enhanced Retirement Sum (ERS)
According to the CPF Board, these retirement sums are meant to provide guidance on the amount of CPF savings you require in order to attain your desired monthly payouts in your retirement years.
With these figures, you can get a better idea of how much you will need to save to support yourself during retirement.
What is the CPF Full Retirement Sum (FRS)?
The FRS is the target amount of savings you should aim to have in your CPF account by the time you reach your retirement age.
The FRS is currently set at two times that of the BRS.
For Singaporeans turning 55 years of age in 2024, the FRS has been set at S$205,800.
This is also the maximum amount that can be transferred into your Retirement Account (RA) at age 55 and that can be put into your Special Account (SA) before the age of 55.
What is the CPF Basic Retirement Sum (BRS)?
The BRS is the basic amount that you need to cover your basic living needs, excluding rental expenses, in retirement.
For Singaporeans turning 55 years of age in 2024, the BRS has been set at S$102,900.
As the CPF Board explains, this amount is computed by taking reference from an individual’s expenditure from a lower-middle retiree household, based on the latest Household Expenditure Survey.
The BRS also assumes that the CPF member owns a property that lasts them up to age 95 and does not need to pay rent in retirement.
The Ministry of Finance estimates that 8 in 10 active CPF members turning 55 in 2027 will be able to set aside at least the BRS.
This would represent the highest level of attainment amongst all cohorts so far.
What is the Enhanced Retirement Sum (ERS)?
The Enhanced Retirement Sum essentially represents the maximum amount that CPF members can put into their CPF RA savings to accrue interest.
The ERS is currently set at three times that of the BRS.
For Singaporeans turning 55 years of age in 2024, the ERS has been set at S$308,700.
However, the ERS will be raised to four times the BRS from 2025 onwards.
Together with a further increase in BRS, the ERS in 2025 will be $426,000 instead of $319,500.
What is the current level of ERS, BRS and FRS?
The table below illustrates the FRS, BRS and ERS amounts for those who will be turning 55 in the next few years.
The CPF Board implements increases to the BRS, FRS, and ERS due to three main reasons: (i) increase in cost of living (ii) increase in life expectancy (iii) increase in standard of living.
From 2023 to 2027, the retirement sums will increase by 3.5% yearly.
The BRS and FRS will depend on when you reach the age of 55 and will remain fixed for the rest of your life.
| 55th birthday in the year of | Basic Retirement Sum (BRS) | Full Retirement Sum (FRS) | Enhanced Retirement Sum (ERS) |
| 2024 | $102,900 | $205,800 | $308,700 |
| 2025 | $106,500 | $213,000 | $426,000 (New) |
| 2026 | $110,200 | $220,440 | $440,800 (New) |
| 2027 | $114,100 | $228,200 | $456,400 (New) |
How much of my CPF can I withdraw at retirement age?
Once you have reached 55 years of age, your CPF savings will be set aside in your Retirement Account (RA) up to the Full Retirement Sum (FRS).
If managed to attain the FRS, you will be able to withdraw any amount in excess of the FRS in your account upon turning 55.
However, if you opt to pledge a property you own, you are only required to set aside the BRS instead of the FRS.
This is to offer property owners the flexibility to set aside their FRS with a mixture of their property and cash.
There are only two conditions for the kind of property you must own: (i) it must be in Singapore (ii) the remaining lease must last you up to at least age 95.
How much will I receive under CPF LIFE with each of the retirement sums?
Upon turning 55, your CPF savings will be transferred to your Retirement Account (RA) up to the Full Retirement Sum (FRS).
With CPF LIFE, you will then receive monthly payouts in your retirement from age 65 onwards.
For those turning 55 years old in 2024, the estimated payout based on the CPF LIFE Standard plan is as follow.
- With the BRS of $102,900, you will receive an estimated payout of $880 per month from the age of 65
- With the FRS of $205,800, you will receive an estimated payout of $1,650 per month from the age of 65
- With the ERS of $308,700, you will receive an estimated payout of $2,430 per month from the age of 65
To get a better idea of your estimated monthly payouts, one helpful tool is the CPF LIFE Estimator calculator provided by the CPF Board.
If you wish to receive higher payouts, you can commit to top up your RA, up to the prevailing Enhanced Retirement Sum.
You will be automatically included in CPF LIFE if you are:
- A Singapore Citizen or Permanent Resident
- Born in 1958 or after; and
- Have at least $60,000 in your retirement savings when you start your monthly payouts
How to reach your desired CPF Retirement Sum faster?
Apart from your monthly contribution, what are the ways that we can build up our CPF savings?
#1 – Transfer from OA to SA
With the CPF Special Account (SA) offering a higher interest rate compared to the Ordinary Account (OA), some may consider transferring OA savings to SA to hit the FRS faster.
This is seen as a safe way to build your retirement savings, allowing you to make your CPF funds work harder for your retirement.
However, the transfer is irreversible, and you will no longer be able to use your OA funds for housing downpayment or monthly mortgage payments.
To understand more about the pros and cons of transferring your OA funds to SA, read our guide on transferring from OA to SA account.
Note that the CPF SA will be closed for those aged 55 and above from 2025 onwards.
You SA savings will be transferred into your RA up to the FRS, where you will continue to earn the interest rate on the RA.
#2 – Make a Retirement Sum Top-Up (RSTU)
You may also choose to make cash top-ups directly to your CPF account, as well as your family members’ CPF accounts with the Retirement Sum top-up.
Before you reach the age of 55, you can top up your SA up to the FRS.
From age 55 onwards, you can opt to top up your RA up to the ERS for higher CPF LIFE payouts in retirement.
| Account | Top-up limit | |
| Below 55 | SA | FRS |
| 55 and above | RA | ERS |
With a Retirement Sum Top-Up, you will also be entitled to tax reliefs amounting to a $1 deduction in your taxable income for every $1 you top up your SA. This is applicable for up to a limit of S$8,000.
You can also receive another S$8,000 in tax reliefs if you do a top-up for your family members.
Hence, you can gain up to $16,000 in tax relief with the Retirement Sum Top-Up (RSTU).
You will also be able to enjoy the highest interest on the SA before your reach 55 years of age and the SA account is closed.
To understand more about the pros and cons of a Retirement Sum Top-Up, read our guide on the topping up your SA account.
#3 Invest your CPF funds
The CPF Investment Scheme (CPFIS) allows you to invest your CPF OA and SA savings in a number of investments that can help grow your retirement savings.
This includes instruments such as stocks, unit trusts, exchange traded funds, bonds, fixed deposits, and insurance products.
This approach may allow you to earn potentially higher returns on your CPF savings.
However, as investments carry risks, make sure you do your due diligence before making any investments with your retirement savings.
You can check out our guide to investing with the CPFIS for a more comprehensive explanation.
What would Beansprout do?
With the increase in CPF Enhanced Retirement Sum (ERS) in 2025, Singaporeans who would like to commit their CPF savings to receive higher payouts at retirement with CPF LIFE now have the option to do so.
For many of us, the key figure that we should aim to achieve by the time we reach retirement age is the Full Retirement Sum (FRS).
The Full Retirement Sum (FRS) for those turning 55 in 2024 has been set at $205,800, equivalent to two times the Basic Retirement Sum (BRS).
If you are looking at ways to reach the Full Retirement Sum (FRS) faster, one of the options to consider would be an OA to SA transfer to earn higher interest rates in a safe way.
Alternative, you can consider a Retirement Sum Top-Up (RSTU), which will also allow you to enjoy tax relief.
Lastly, you can also make use of the CPF Investment Scheme (CPFIS) to generate potentially higher returns on your CPF savings.
Don’t know where to start? Here’s a financial checklist to guide you along.
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