In Singapore, the primary source of retirement income for most people will be CPF LIFE (Lifelong Income For the Elderly). CPF Life is our national annuity plan that provides a lifelong monthly payout for Singaporeans, aged 65 and above.
The exact amount that you receive each month is based on two factors. How much you have in your Retirement Account (RA) and the CPF LIFE plan that you choose.
Naturally, the more you have in your RA, the higher your monthly payout is going to be. If you want to enjoy higher payouts each month, you can consider making lump-sum top ups to your RA when you can over the years.
The choice of your CPF LIFE plans will also impact how much you receive each month. If you like to enjoy higher monthly payouts, you can opt for the CPF LIFE Standard plan. Alternatively, if you do not need such a high monthly payout, and would prefer to leave a higher level of bequest to your loved ones, you can opt for the Basic Plan. A third plan, the Escalating Plan, provides an annual increment of 2% for your monthly payouts.
You should consider how much money you will be able to receive from your CPF LIFE each month, and whether it’s sufficient for your expected monthly expenditure.
Do note as well that payouts for CPF LIFE only starts from age 65. Hence, if you want to retire before that, you will need to have other streams of income to make up for that shortfall.