What is the Full Retirement Sum (FRS)?
By the age of 55, there are three savings targets linked to your CPF Retirement Sum that you can aim to achieve. Depending on which target you reach, your retirement payouts will be categorised as follows:
The CPF Retirement Sum refers to the complete sum of your CPF savings that should be allocated to ensure a comfortable retirement lifestyle. Upon reaching age 65, monthly payouts will be provided and will persist throughout your lifetime.
- Basic Retirement Sum (S$99,400 in 2023)
- Full Retirement Sum (S$198,800 in 2023)
- Enhanced Retirement Sum (S$298,200 in 2023)
These sums represent the amount you should set aside in your Retirement Account (RA) by age 55 to ensure a certain level of monthly payouts during your retirement years.
The Basic Retirement Sum (BRS) serves as the minimum threshold, while the Full Retirement Sum (FRS) and Enhanced Retirement Sum (ERS) provide higher payout levels.
How does the Full Retirement Sum (FRS) work?
If you meet the FRS target but do not own any property, you can withdraw either S$5,000 or any amount exceeding the FRS in your account, whichever is greater.
However, if you are a property owner and meet the FRS, you can withdraw any amount exceeding the BRS present in your RA.
Typically, the FRS is twice the amount of the BRS, ensuring you can withdraw at least half of the funds available in your account.
You can use the CPF LIFE Payout Estimator tool to calculate how much money you will receive each month.
What should I know about the CPF Retirement Sum?
Keep in mind that you have flexibility when it comes to the Retirement Sums.
You are not obligated to strictly adhere to the prescribed BRS, FRS, or ERS. Regardless of the specific amounts, you can still receive lifelong income based on the CPF savings you have accumulated by age 55.
In fact, you may even be exempted partially or entirely from the Retirement Sums if you are enrolled in a lifelong pension scheme or have a private annuity plan. However, it’s important to note that such exemptions are subject to approval from the CPF Board, and specific criteria must be met.
The information provided was accurate at the time of publication. For the latest changes and updates, head over to the official website.
