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It has been a while since I blogged.
So, I decided to share this reply to a reader's comment as a blog since it is a little more substantial.
If you are interested in the reader's comment, you can read the comment: HERE.
Hi Staerfeldt,
I am glad that my blog has been inspirational. :D
The CPF has definitely been gaining popularity compared to the reception it used to get in my early days as a blogger.
The very low interest rate environment in recent years probably made it even more popular. :)
It is important to remember what is the primary purpose of the CPF which is to help fund our retirement.
So, we should not use our CPF savings in a careless manner in so many ways just because we are allowed to.
Many who invested with their CPF savings would have been better off just leaving the money in their CPF accounts.
The CPF is really designed to help the masses and not the rich amongst us:
CPF LIFE is an annuity that pays for life.
So, ERS is a pretty good way of ensuring we get more monthly pocket money in our old age.
However, this only really pays off if we live a very long life.
Beyond the first $60K in CPF savings, the RA pays 4% per annum just like the SA.
So, it really isn't a big loss if we choose to have FRS instead of ERS, leaving some money in the SA untouched which gives us options on withdrawal too.
Personally, I think the FRS is good enough as I like to keep my options open.
Of course, I could change my mind later on. :)
You might be interested in this blog from 2015:
From CPFB:
What are the Basic Retirement Sum (BRS), Full Retirement Sum (FRS) and Enhanced Retirement Sum (ERS)?
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