What happens to my CPF savings after setting aside the Minimum Sum?

Once a CPF member has turned 55 and fulfilled the Minimum Sum requirement (currently at $123,000), any excess can be withdrawn in cash. What happens to the excess amount if he/she do not intend to withdraw this money? Let's take a look.

If the CPF member decides not to withdraw at that point of time, the money left there will earn interest same as the account that is is from (i.e. if it is from the Ordinary Account, it will earn 2.5% interest). Therefore this is a better option than withdrawing all the money and leaving it in a bank account, which is paying interest of a fraction of a percent.

The CPF member may also choose to make a partial withdrawal. If the member choose to do a partial withdrawal, the subsequent withdrawal can only be made upon the member reaching his/her next birthday. Which also means that the withdrawal can be made once a year. There is no minimum amount required to be withdrawn.

If the member has existing investments made via the CPF Investment Scheme (CPF-IS), he/she can instruct CPF to close his/her CPF-IS Account by written notice. The agent bank handling the CPF-IS Account will then inform the relevant investment companies to pay any proceeds directly to the member in cash. Any shares held will be transferred to the CDP account. Any insurance policy's maturity proceeds will also be made directly to the member.

If the member did not close his/her CPF-IS Account, the investment/maturity proceeds will be returned to the CPF account and the same withdrawal rules apply.

For further questions, you may contact me at cjhfinance@gmail.com