5 things you need to know about CPF Life Standard Basic


The reason why we start on our journey with money is so that we can afford what we want and retire early. There are many ways to retire early. For example, you can always turn your daily cuppa into retirement fund or study using stock options to generate monthly income. Otherwise, we can always wait for CPF Life.

The CPF Life (Standard or Basic or Escalating) was introduced by the CPF board to provide CPF members a monthly payout for life when they reach their payout eligible age.

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What is CPF Life?

CPF Life is basically an annuity that provides monthly payout for life for CPF members. At 55 years old, our Ordinary Account (OA) and Special Account (SA) will be joined together to become the Retirement Account (RA). You can select which plan (Standard, Basic, Escalating) during this period of time. If you didn’t choose, it will be by Standard by Default.

 

When will I get the my monthly payout?

 

You will get your monthly payout at age 65 until the day you die.

 

Which plan should I get?

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It is debatable which is the better plan. CPF Life Escalating plan is introduced on 1 Jan 2018 to solve the evolving needs of people. With each person having their own set of situation, it is very hard to determine which is the best one for you. One way to find out is to give CPF a call or contact your Financial Planner to ask for advise.

 

How much will I get?

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Depending on your retirement sum in your RA account, these are the estimated monthly payouts for CPF LIFE.

 

What happens if you need more for retirement?

If you require more for retirement, you have to seek additional stream of income for you to reach your retirement goals. It will be good to start doing financial planning to understand how much you need for retirement. Thereafter, you can consider several tools like value investing, or maximizing your CPF and investing using options in your retirement journey.

All the best to your journey with money.

 

Bonus: CPF Life Explained in 5 minutes

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