CPF Special Accounts closed for members aged 55 and above
The Central Provident Fund (CPF) Board has announced the closure of about 1.4 million members’ Special Accounts (SAs) as of Sunday (19 Jan).
In a media release on the same day, it said members’ SA savings had been transferred to the Retirement Account (RA).
Savings in CPF Special Accounts transferred up to FRS
The CPF Board also said that members whose SAs were closed are aged 55 and above.
Their RAs would be topped up to the Full Retirement Sum (FRS) of one’s cohort.
There, they will continue earning the long-term interest rate from Jan 2025.
If one had already set aside the FRS, any remaining SA savings were transferred to their Ordinary Account (OA).
Members may withdraw OA funds or transfer them to RA
In the OA, members will earn 2.5% interest per annum and may withdraw the funds when needed.
Members may also choose to transfer their OA savings to their RA up to the current year’s Enhanced Retirement Sum (ERS), to continue earning the higher interest rate of 4% per annum and get higher retirement payouts.
This transfer is irreversible and can be made anytime, but to enjoy the higher interest from January onwards, the transfer must be processed by January 2025.
The ERS was raised on 1 Jan, from three times to four times the Basic Retirement Sum. It will increase every January.
Members will be notified from 20 Jan
The CPF Board said members would be notified of the SA closure from Monday (20 Jan).
This will be via a hardcopy letter, as well as email or SMS where applicable.
Members can also view the amounts transferred to their RA and/or OA by logging into their CPF account or via the CPF Mobile app.
It cautioned members to be extra vigilant against scammers who may pose as CPF Board staff or claim to be appointed by the Board, and ask for personal details.
Closure of CPF Special Accounts announced during Budget 2024
The impending closure of the SA was announced by then Deputy Prime Minister Lawrence Wong during Budget 2024.
At the time, it was said that the move would happen in “early 2025”.
Mr Wong said during a Channel NewsAsia interview in February last year that the closure aligned with CPF’s objectives.
While the SA has higher interest rates, those aged 55 and above also have the RA, which earns the same long-term interest rate as the SA, he explained.
Hence, closing the SA would streamline their savings to just their RA.
He added that the “vast majority of Singaporeans” would be able to transfer their excess funds from the SA to the RA. CPF’s website reported this figure to be more than 99% of eligible members.
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Featured image from MS News.
