How the CPF Special Account closure affects me?

The Special Account (SA) had been officially closed this year.

 

I got an official notification from CPF with regards to the SA closure for my mum’s CPF account.

This closure doesn’t really affect my mum’s CPF because my mum does not have Full retirement sum in her SA.

 

On top of that, she isn’t working and there was no money being deposited into her SA account. Hence there is nothing in her SA to be moved out.

 

Well, its different for me. The closure of the Special Account will affect me when I reached 55 since I had already hit the Full Retirement Sum in my SA.

 

So how much will I be affected by that? I did a check with the CPF calculator and I compared what will be the total amount I would have in my CPF at 65 under the 4 scenarios below

 

1) Before SA closure

2) Before SA closure with SA shielding

3) After SA closure

4) After SA closure with ERS topup

 

Based on the calculated results, the table below shows the amount I would have at 65 under the different scenarios.

Before SA closure	Before SA closure with SA shielding	After SA closure	After SA closure with ERS topup
$1.976 mil	$2.035 mil	$1.929 mil	$1.995 mil

 

 

As expected, I would end up with the most with SA shielding and the least with the closure of SA. I would effectively end up with about $100k lesser due to the closure of the SA. This amount drops to around $40k if i eventually decided to top up my RA to the new ERS amount.

 

Looking at the figures in my CPF when i hit 55, it is likely that i will be topping up my RA to ERS. I will have some left over in my OA where I will try to look for better investment returns or sign up for an annuity plan. By then I should also be able to withdraw the money in my OA if necessary to open up more investments opportunities.

 

Please note that these figures are for the amount I have in my CPF account. It will be different for everyone and you can use the CPF calculator to do the comparison for yourself.

 

Also note that I will be removing the toggle box soon and default the CPF calculator to one without SA after you turn 55 years old. Happy CPFing!

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