A CPF member who would be turning 65 in May this year, recently received a mail from the CPF Board. It informed him that he would be eligible to receive S$250 per month for about the next 8 years when he hit 65.
It also enticed him saying that he can get higher payouts if he delays the start of his payouts after age 65. In fact, if the member does nothing, by default, he would only start getting his payouts at age 70.
And if he still wants to get his payouts starting at 65, he must inform the CPF Board.
How to survive $250 in Singapore for 1 month, let alone 8 years?
In any case, at $250 per month, it’s not known how the CPF member is going to survive in Singapore for one month, let alone 8 years.
And even if he is able to survive and scrape through by cleaning tables at hawker centers, it’s not known if he can continue to do so after 80+ years old.
As a last resort, the Singapore laws do enable him to sue his children to get money, assuming he has children, so that he can continue surviving here.
Govt to increase CPF withdrawal age?
Separately, Manpower Minister Josephine Teo told Parliament yesterday (15 Jan) that the minimum age to receive monthly CPF payouts will not be lowered for now.
Employees appear to be more concerned about being able to work longer and save more, she said.
However, she appears to be hinting that the legal CPF withdrawal age may be increased in future. She said that more than half of the OECD countries have set their pension withdrawal age at 65 or older.
Some are raising it in the light of increasing longevity, she added. For example, The Netherlands, Denmark and Germany are raising their respective pension withdrawal ages gradually to reach 67 by 2021, 2022 and 2029, she said.
“So against such a backdrop, we must really ask if it is wise to lower our own PEA (payout eligibility age),” she said.
Since the minister mentioned countries like Denmark and The Netherlands in her parliamentary speech, it is interesting to note that, in Denmark, the full basic pension amount is DKK6,160 per month (S$1300), equivalent to around 19% of its national average earnings.
In the case of The Netherlands, the basic pension benefit for a single person is EUR1,144.72 per month in 2016. There is an addition holiday allowance of EUR72.48 per person. This gives a total equal to EUR1,217.20 (S$1,900) for singles and EUR1,655.68 (S$2,600) for couples.
The CPF member who would be receiving his monthly payout of $250 at 65 must now be thinking if he could live in Denmark or The Netherlands instead so as to enjoy pension payouts of $1300 or $1900 a month, even though he may be getting pension at 67 in those countries.