Major CPF Changes

(1) Work Longer
(A) Re-employment Legislation (wef 2012)
From 2012, employers are to offer re-employment for those reaching 62 to work till age 65, and later to 67.

(B) Workfare Increase (wef Immediate)
Workfare Income Supplement (WIS) will increase from current $100/mth, and the 1st payout will be in Jan 2008.
(i) >60 years old: $200/mth
(ii) 56-60 years old: $150/mth

(2) CPF Returns
(A) Extra Interest Tier (wef Jan 2008)
Additional 1% interest rates for the 1st $60k in combined accounts (max $20k from OA). Interest earned will go into SA or RA.
(i) CPFIS Restrictions (wef Apr 2008)
The 1st $20k in both OA and SA will not be allowed for CPFIS.
Money already invested will not be affected.
(ii) OA Remains at 2.5%,
Also no change to HDB concessionary loan interest rate.

(B) SMRA Interest Rates Peg to Government Bonds (wef Jan 2008)
SMRA will peg to the yield of the 10-year S'pore Government Securities (10Y SGS) + 1%. The Government will keep 4% floor for the 1st 2 years, after which, the 2.5% floor rate will apply for all accounts.

(3) Draw-Down Age (DDA)
2007: 62
2012: 63
2015: 64
2018: 65

For those affected by deferment of DDA:
(A) D-Bonus
- For those age 50-57 in 2007 (Payout for age >55 on May 08, the rest will receive it at age 55)
- Capped at $30k
(i) 54-57: 5% of RA
(ii) 52-53: 4% of RA
(iii) 50-51: 3% of RA

(B) V-Bonus
- For voluntarily deferment
- Bonus will be given for each year of deferment, up to age 65
- 2% of RA, and capped at $30k

[Note: OA-Ordinary Account, SA-Special Account, RA-Retirement Account, SMRA-Special, Medisave and Retirement Accounts]

* MOM-CPF Reforms , MOM-Reforms (Slides) , AsiaOne-CPF , MrBrown-CPF *