CPF Retirement Account (CPF RA): Your Definitive Guide

Financially Reviewed by Edward Hee
By Tan Yuan Tian

Published: 23 September, 2024
Last Updated: 17 March, 2025

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Planning for your golden years might seem overwhelming, but your CPF Retirement Account (RA) is a key tool to securing a comfortable future.

Navigating the ins and outs of CPF, I can tell you that getting your RA in order is crucial to enjoying a stable retirement.

In this post, you’ll learn:

What the CPF Retirement Account is
How it’s created and what the minimum sums are
Alternative ways to grow your RA
Why topping up your RA is so beneficial

Keep reading to find out how to optimise your CPF RA and ensure you’re financially ready for retirement!

What is the CPF Retirement Account?

The CPF Retirement Account (RA) is the heart of your retirement savings, consolidating funds from your Ordinary Account (OA) and Special Account (SA) to ensure you’ve got enough for your golden years.

This forms your retirement sum, which eventually pays out as monthly income during your retirement years under the CPF LIFE scheme.

It’s designed to provide you with a stable source of income so you won’t need to worry about your day-to-day expenses later in life.

How is the CPF Retirement Account created?

Your CPF Retirement Account (RA) is automatically created when you turn 55, at which point the savings from your Special Account (SA) and Ordinary Account (OA) are transferred into your RA.

The amount transferred will form your retirement sum, which determines how much you’ll receive each month once you start your payouts.

What can I use the CPF Retirement Account for?

Your CPF Retirement Account (RA) is primarily set up to support you financially in your later years, but there are 2 key areas where these funds come into play: CPF LIFE payouts and property payments.

CPF LIFE payouts

The main purpose of your RA is to provide you with monthly payouts through the CPF LIFE scheme, starting when you turn 65.

These payouts are designed to give you a steady income for as long as you live, ensuring that you won’t outlive your retirement savings.

The amount you receive depends on your retirement sum – whether you have the Basic, Full, or Enhanced Retirement Sum – and you can choose from different CPF LIFE plans based on your preferences for larger payouts or longer-lasting ones.

Property payment

Though the CPF Retirement Account is primarily for retirement, you may also be able to use some of the funds to make property payments under certain conditions.

If you meet the Basic Retirement Sum (BRS) requirement in your RA, you might be allowed to withdraw any excess savings to cover housing loans.

This is particularly helpful if you’re still paying off your property or looking to downsize as you approach retirement.

However, it’s important to ensure that using your RA for property payments doesn’t compromise your long-term retirement security.

What is the minimum sum for your CPF Retirement Account?

There is no minimum sum for your CPF Retirement Account exactly, but a good benchmark to know is that you should at least meet the Basic Retirement Sum (BRS).

As of 2024, the BRS is $102,900.

What happens if I don’t meet the minimum sums for CPF RA?

If you don’t meet the Basic Retirement Sum (BRS) by the time you turn 55, don’t worry – you’ll still receive monthly payouts when you retire, just at a lower amount.

You still get payouts through CPF LIFE

Even if your CPF Retirement Account (RA) doesn’t reach the BRS of $102,900 by 55, you’ll still receive monthly payouts starting at age 65.

The amount you receive will depend on the balance in your RA at that time.

Your payouts will simply be lower in line with your account balance.

You can make top-ups to boost your RA

If you want to boost your retirement payouts but don’t have enough in your RA, you can make cash top-ups or transfer funds from your Ordinary Account (OA).

Take note that once this is done, it is irreversible, so make sure this is what you want.

There’s also the Retirement Sum Topping-Up Scheme (RSTU) that allows you, or even your loved ones, to top up your RA to increase your retirement savings and potentially increase your payouts.

Your property can help

If you’ve used your CPF for housing and still have a property, you may be able to pledge the value of your property to make up the shortfall in your RA.

This way, you won’t have to set aside the full BRS in cash, and the shortfall will be covered by your property’s value.

You can still make withdrawals

If your RA savings fall short, you won’t be able to make large withdrawals, but you can still take out a small portion in cash, subject to certain conditions.

CPF allows withdrawals of up to $5,000 from your RA, regardless of how much you’ve saved.

This gives you some flexibility to meet any urgent financial needs.

Is there a maximum sum for your CPF Retirement Account?

Yes, there is a maximum sum for your CPF Retirement Account (RA), known as the Enhanced Retirement Sum (ERS).

As of 2024, the ERS is $308,700 – 3x of the BRS.

However in 2025 onwards, the ERS will be 4x of the Basic Retirement Sum.

Relationship between your CPF RA and the CPF Retirement Sums

The retirement sum is essentially a savings goal that helps determine how much you need to set aside in your CPF Retirement Account (RA) to secure monthly payouts during your retirement.

Here’s the key relationship between the 2:

The Retirement Sums set your savings target: The BRS, FRS, and ERS represent the different levels of savings you should aim for in your CPF RA to determine how much you’ll receive in monthly payouts.
Your CPF RA determines your payout: Once the savings from your OA and SA are transferred into your RA, this amount becomes your retirement sum, which, in turn, dictates how much you’ll receive in your CPF LIFE monthly payouts.

So, in short, your CPF Retirement Account and Retirement Sums work hand-in-hand: the more you save in your RA, the closer you get to hitting one of the three retirement sums, which then directly impacts how much monthly income you can expect when you retire.

55th birthday in the year of	Basic Retirement Sum (BRS)	Full Retirement Sum (FRS)	Enhanced Retirement Sum (FRS)
2024	$102,900	$205,800	$308,700
2025	$106,500	$213,000	$426,000
2026	$110,200	$220,400	$440,800
2027	$114,100	$228,200	$456,400

Why should you top up your CPF Retirement Account?

Here are 4 compelling reasons to consider topping up your RA:

Receive higher monthly payouts

The more you contribute to your CPF Retirement Account, the higher your monthly payouts will be during retirement.

By topping up your RA, you can aim to hit higher tiers like the Full Retirement Sum (FRS) or even the Enhanced Retirement Sum (ERS).

This will directly increase your payouts through CPF LIFE, giving you more financial flexibility to cover daily expenses, healthcare, or even enjoy some luxuries in your later years.

For example, if you only meet the Basic Retirement Sum (BRS), your monthly payouts will be modest, designed to cover basic living costs.

But by reaching the FRS or ERS, you’ll secure significantly larger payouts, ensuring that you won’t have to worry as much about maintaining your lifestyle after retirement.

Earn interest rates of up to 6% per year on your retirement savings

Topping up your CPF RA also allows you to benefit from the attractive interest rates CPF offers.

Your RA savings can earn up to 6% per year, which is considerably higher than what most regular savings accounts provide.

This interest is compounded, meaning the longer your money sits in your RA, the more it grows.

By topping up your RA early, you maximise the amount of time your savings have to compound, allowing you to accumulate a larger retirement fund.

Enjoy $16,000 in tax benefits annually

One of the biggest perks of topping up your CPF Retirement Account (RA) is the tax relief you can enjoy.

By making cash contributions to your own CPF account, or even your loved ones’ accounts (such as parents, grandparents, or spouse), you can enjoy up to $16,000 in tax benefits annually.

This breaks down into:

Up to $8,000 in tax relief for contributions to your own CPF Retirement Account.
An additional $8,000 for contributions made to your loved ones’ CPF accounts.

Matched retirement savings scheme for seniors

For seniors aged 55 to 70 with lower CPF balances, the Matched Retirement Savings Scheme (MRSS) offers an additional incentive.

Under this scheme, when eligible seniors receive cash top-ups, the government will match their contributions dollar-for-dollar, up to $600 annually.

This is a great way to help seniors boost their CPF Retirement Account, effectively doubling the value of their cash top-ups.

By taking advantage of both the tax benefits and the MRSS, you or your loved ones can significantly increase retirement savings while also enjoying valuable financial incentives.

How to top up CPF RA?

Topping up your CPF Retirement Account (RA) is a straightforward process and is quite similar to topping up your CPF Special Account (SA).

If you’re familiar with that process, you’ll find it easy to follow for the RA as well.

For a detailed guide, you can check out our step-by-step article on how to top up your CPF Special Account.

What are the alternative options to grow your RA?

One powerful way to grow your RA is through CPF Transfers.

You can transfer funds from your Ordinary Account (OA) into your RA, which allows you to take advantage of the higher interest rates offered in the RA – up to 6% annually.

This is particularly beneficial if your OA funds are underutilised and you want to earn more interest on your savings.

However, this transfer is irreversible, so it’s crucial to be certain before proceeding.

Once the funds are moved into your RA, you won’t be able to use them for other purposes like housing or investments.

Another option to grow your RA is by continuing to contribute to CPF after age 55.

Although turning 55 typically marks the point when you can start withdrawing funds, you can still contribute to your CPF accounts – either voluntarily or through employment contributions.

These continued contributions will be split between your OA and MediSave Account (MA), but any excess will flow into your RA, helping you increase the balance.

Conclusion

To wrap it all up, your CPF Retirement Account is a key part of your financial future.

From understanding how it’s created when you turn 55, to the different ways you can grow it – like cash top-ups, CPF transfers, or continuing contributions after age 55 – there are plenty of strategies to ensure you’ll have enough for a comfortable retirement.

We also talked about the importance of meeting the retirement sums (BRS, FRS, and ERS) to secure steady monthly payouts, and how topping up can even help you enjoy some nice tax benefits.

If you’re still scratching your head about how to maximise your CPF RA or wondering which approach works best for your situation, you’re not alone!

Financial planning can be tricky, but we’re here to help.

Feel free to reach out, and we can connect you with one of our trusted financial advisor partners for free.

They’ll give you personalised advice so you can confidently plan for your future.

References

Tan Yuan Tian

Yuan Tian is an aspiring digital creative who’s looking to shape the industry for the better. She finds joy in picking up things that spark her curiosity and mindfulness. Not to mention, she’s an outdoor sports fanatic!

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