This little known fact on CPF withdrawal came to me yesterday after talking to a CPF officer at CPF Branch.
Normally, once cash amount is captured in your Retirement Account (RA), you cannot touch this money. It is meant for your retirement needs like paying you on CPF Life scheme.
But, some money can be withdrawn by you from this RA account after age 65 based on the schedule (attached in photo). This amount is termed as Additional Withdrawable.
Hereby lies the problem. I am already after age 65. If I were to withdraw any CPF money from my Ordinary Account (OA), the system will deduct from the Additional Withdrawable (RA) FIRST before it can withdraw from the OA. In the process, I lose the chance of getting higher interest in RA (at 4.08% pa) on this Additional Withdrawable.
Because I chose to defer CPF Life monthly payout until I am 70 years old, I have to take action BEFORE 70 years old to KEEP this Additional Withdrawable in my RA. I want to keep this Additional Withdrawable in RA to boost my monthly payouts on CPF Life.
Bottom line, 2 actions required:
- Stop CPF cash withdrawal from now until age 70.
- Take action to keep this Additional Withdrawable in RA at age 70.
I already know my Additional Withdrawable dollar amount now computed by CPF Board.
Note: I am on CPF Life Basic Plan and I defer CPF Life payout to age 70. I am at age 67 now.
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