Written by: Marissa Saini
Introduced during the Budget 2020 speech by Deputy Prime Minister Heng Swee Keat, the new Matched Retirement Savings Scheme will help those with less Central Provident Fund (CPF) savings, effective from 2021 to 2025.
Who will benefit from this scheme?
About 435,000 Singaporeans with insufficient CPF savings in their Basic Retirement Sum (BRS) will benefit from this scheme.
What is this scheme about?
Through this scheme, the Government will match every dollar of cash top-up made to the CPF Retirement Account (RA), capped up to $600 per year. Over the five year period (2021 to 2025), eligible Singaporeans will be able to receive up to $3,000 in matched savings.
Who is eligible for this scheme?
This scheme is eligible for lower- to middle-income senior Singaporeans aged 55 to 70 who don’t have a prevailing amount set aside in their BRS. This will be updated once full details of the scheme is announced.
What is the BRS?
Singaporeans who’ve turned 55 and own a property (with a lease that can last them till 95) may put aside savings into their BRS. Once the Singaporean has reached 65, the monthly payouts to supplement living expenses will be drawn from their BRS account.
This year, the RA savings required for people turning 55 is $90,500. For the next two years, the BRS is expected to be raised by 3% each year. It is meant to be a financial safety net for eligible Singaporeans to pull their CPF LIFE monthly payouts from, and as such will need to be adjusted according to factors such as future inflation and the ever-evolving standard of living.
If you are turning 55 years old in 2021, you will need $93,000 put away in your BRS. But if you will be 55 in 2022, the BRS amount will be raised to $96,000.
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Sources: CPF, Straits Times, TodayOnline
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