Bonus amounts to be revealed later. Move will further increase retirement sums, says Eng Hen
OLDER workers who delay drawing down the Minimum Sum in their CPF account will get a bonus - for each year of deferment. Manpower Minister Ng Eng Hen yesterday announced the move to give them the bonus every year at the opening of the annual Central Provident Fund roadshow.
This annual bonus will apply to those affected by the later draw-down, as well as those who voluntarily defer on their draw-down.
Prime Minister Lee Hsien Loong announced in his National Day Rally speech on Sunday that the draw-down age for the Minimum Sum will be postponed from 62 to 63 in 2012. It will then be gradually raised to 65 by 2018.
To sweeten the wait, those affected - people aged between 53 and 57 - are supposed to get a 'D-bonus', a one-off Deferment Bonus interest, paid into their CPF Retirement Account.
A smaller 'V-bonus', or Voluntary Deferment Bonus, will be given to those aged 58 and older who are unaffected by the changes, but voluntarily delay drawing down their Minimum Sum.
The Minimum Sum is the amount people must keep in their Retirement Accounts after withdrawing their CPF at age 55. The current Minimum Sum required is $99,600.
Before the change announced on Sunday, people got a monthly payout from the Minimum Sum at age 62.
Said Dr Ng yesterday of the yearly bonus: 'This will further increase retirement sums and, for most workers, this will translate to many more years of income support after they retire.'
He told reporters that the bonus amount will revealed later. He added that those with the Vbonus can choose to defer their draw-down until they turn 65.
While more details will be announced in his ministerial statement in Parliament next month, Dr Ng reassured Singaporeans that the changes will be made progressively to allow them time to adjust.
And amid the changes, he challenged the CPF Board to make it easier for all members to plan their retirement.
Besides launching a new retirement-planning online portal called Retirement Ready @ my cpf, he asked for more measures to educate the public that would involve just 'a few simple steps'.
More resources will be pumped into this, he pledged, and cartoons will soon be publicised to better explain the recent changes.
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