CPF, Medisave minimum sums to go up from July

The Central Provident Fund (CPF) and Medisave minimum sums will be raised effective July this year, the Ministry of Manpower and the CPF board announced jointly on Thursday.

The minimum sum for CPF members who turn 55 between the start of July this year and the end of June next year will be $155,000, up from S$148,000 currently.

In a statement, the ministry and CPF board explained that the CPF Minimum Sum has been increasing for each group of members turning 55 yearly to accommodate the “rising expectations of what is considered a basic standard of living in retirement”.

MOM also stated that the increase is in keeping with the target to reach $120,000 (in 2003 dollars) by 2015, after taking inflation into account.

CPF members will be able to receive monthly payouts from the minimum sum when they reach the draw-down age. Those who are now 55 years old or younger will be able to receive the monthly payouts when they reach 65 years of age.

The Medisave minimum sum will be raised from $40,500 to $43,500. The sum is the amount a CPF member needs to set aside in his Medisave account for his and his dependants’ healthcare expenses, as well as MediShield and ElderShield premiums during old age.

MOM and the CPF board explained that as Medisave is opened up to more uses, regular Medisave minimum sum adjustments “are necessary to help Singaporeans better prepare for their long-term healthcare needs”.

The Medisave contribution ceiling will also increase from $45,500 to $48,500. This is the maximum balance a member can have in his Medisave Account. Excess Medisave contributions will be transferred to the member’s Special Account or Retirement Account.