SINGAPORE — About 85,000 people born before 1948 will start receiving automatic monthly payouts from June, said the Central Provident Fund (CPF) Board on Wednesday (Feb 15).

They will start receiving the payouts in their coming birth month in their personal bank accounts and be notified beforehand.

Previously, many members had neglected to instruct CPF Board to start payouts from age 65, prompting the Board to implement a change in 2018, which saw members who were born on or after 1948 receive automatic monthly payouts.

"This was positively received as the seamless process had allowed CPF members to enjoy their CPF savings which they had accumulated during their working years," said CPF Board.

"It is timely to extend this automatic commencement of monthly payouts to cohorts born before 1948." 

Under the Retirement Sum Scheme, seniors receive monthly payouts until their retirement savings run out. It is one of two retirement schemes under the CPF Board.

The scheme applies to those who are not on CPF Life, which automatically enrols those turning age 65 from 2023 with at least S$60,000 in their CPF Retirement Account and provides lifelong monthly payouts in retirement.

Seniors on the Retirement Sum Scheme can opt to join CPF Life anytime before turning age 80 to receive lifelong payouts. 

The CPF Board on Wednesday also announced that about 7,000 members and future members on CPF Life will see higher monthly payouts if they have any savings in their Ordinary and Special Accounts that cannot be withdrawn in a lump sum.

Explaining the move, it said that members who have started receiving their CPF Life payouts may have received subsequent inflows to their Ordinary and Special Accounts.

"If they have not set aside their cohort Full Retirement Sum, such inflows may not be withdrawable in a lump sum and are meant to be streamed out as monthly payouts," said the CPF Board.

"These members currently need to instruct CPF Board to annuitise their Ordinary and Special Account savings so that they may receive a higher CPF Life payout."

From October 2023, any savings in their Ordinary and Special Accounts which cannot be withdrawn in a lump sum will be automatically annuitised for higher CPF Life payouts. Members will be individually notified before that.

On Tuesday, Finance Minister Lawrence Wong announced in his Budget speech that the minimum CPF monthly payout for seniors on the Retirement Sum Scheme will be raised from S$250 to S$350 per month. 

About 112,000 members are expected to benefit from this change from June. CNA