Retirement Age in Singapore: A Comprehensive Guide

Planning for retirement is crucial, and understanding the retirement landscape in Singapore is key to a secure future. This article clarifies the retirement age, re-employment age, CPF payouts, and other related aspects, addressing common questions and concerns.

Retirement Age and Re-employment Age: Key Differences

In Singapore, the retirement age and re-employment age are distinct concepts. The retirement age is the age at which an employer can legally request an employee to retire, while the re-employment age is the age until which employers must offer re-employment to eligible employees.

Current and Future Ages

• Retirement Age: Currently 63, increasing to 64 on July 1, 2026. It will be applicable to those born on or after 1 July 1963.
• Re-employment Age: Currently 68, the re-employment age will be raised to 69 years from 1 July 2026, which will apply to those born on or after 1 July 1958.

Employers cannot ask employees to retire before the statutory retirement age. However, they can terminate employment for reasons unrelated to age, such as poor performance or company restructuring. Eligible employees with satisfactory performance and good health are entitled to re-employment offers until they reach the re-employment age. This can be with the same employer, under adjusted terms, or with assistance finding alternative employment if necessary.

CPF Payouts and Retirement Benefits

The Central Provident Fund (CPF) is a mandatory savings scheme contributing to retirement, housing, and healthcare. Upon reaching retirement age, members can access their savings.

CPF Retirement Account (RA)

While your CPF Retirement Account (RA) is created at age 55, the CPF Board will transfer your CPF savings, up to your Retirement Sum (FRS), to create your Retirement Account (RA). The savings in your RA are meant to provide you with payouts in retirement. Your Special Account (SA) savings will be transferred first, followed by your Ordinary Account (OA) savings.

What are the retirement sums: Basic Retirement Sum (BRS), Full Retirement Sum (FRS), and Enhanced Retirement Sum (ERS)?

Estimated Monthly Payouts (2024 - 2027)

Note: These are estimates and may vary.

Other Retirement Benefits in Singapore

Working Beyond Retirement Age

Singapore encourages continued employment beyond the retirement age. Employers are required to offer re-employment to eligible employees until the re-employment age. Government initiatives, such as the Part-Time Re-employment Grant (PTRG) and Senior Employment Credit (SEC), support this.

1. Part-Time Re-employment Grant (PTRG)

The Part-Time Re-employment Grant (PTRG) is a Singapore government initiative designed to support employers in offering part-time re-employment options to eligible senior workers upon their request. Here's a breakdown of the scheme:

1. Purpose:
   • Encourages employers to create part-time re-employment opportunities for senior workers who prefer reduced workloads as they approach retirement age. This arrangement supports their transition while enabling them to remain in the workforce.
2. Eligibility and Funding:
   • Employers can receive $2,500 per senior worker (aged 60 and above) who is provided with part-time re-employment options.
   • Funding is capped at 50 senior workers per company, with a maximum grant of $125,000 per company.
   • To ensure sustained practices, companies must integrate these arrangements into their HR policies and employment contracts.
3. Impact:
   • The scheme has already benefitted over 19,000 senior workers and close to 2,000 employers since its launch in July 2020​ by Ministry of Manpower Singapore.

CPF Withdrawal Options

Singapore’s Central Provident Fund (CPF) provides retirees with two primary options to receive monthly payouts that ensure financial stability during retirement:

1. Retirement Sum Scheme (RSS)

• Overview:
  The RSS provides monthly payouts drawn from the savings in your Retirement Account (RA).
• Duration:
  The payouts continue until the RA savings are exhausted or until the retiree reaches the age of 90.
• Flexibility:
  This scheme is suited for individuals who prefer to withdraw their funds over a defined period rather than opting for lifelong payouts.

2. CPF LIFE (Lifelong Income for the Elderly)

• Overview:
  CPF LIFE is an annuity scheme that ensures retirees receive lifelong monthly payouts, regardless of how long they live.
• Plan Options:
  CPF LIFE offers three plans to cater to different needs:
  • CPF LIFE Basic Plan: Payouts continue until the retiree reaches age 90, with about 80-90% of their Retirement Account (RA) savings used to provide payouts.
  • CPF LIFE: Payouts continue for as long as the retiree lives. The monthly payouts are first paid from the CPF LIFE premiums, and then from the accumulated interest once the premiums are depleted.
  • Non-CPF LIFE: Payouts continue until the retiree's savings run out. Payouts can start at any time after age 65, or automatically at age 70 if the retiree doesn't choose to start earlier. 
• Advantages:
  Ensures retirees never run out of savings, providing peace of mind and long-term financial security.

For more details on CPF withdrawal options, visit the official CPF page.

Early Retirement Considerations

While CPF does not have a dedicated early retirement scheme, Singaporeans can achieve early retirement through strategic financial planning and the effective use of available resources.

1. Using CPF Savings

• You can withdraw funds from your Ordinary and Special Accounts after reaching 55 years old, provided you set aside the required Retirement Sum in your RA.
• Planning your withdrawals to balance immediate needs and future financial security is crucial.

2. Supplementary Income Sources

• Investments: Building a diversified investment portfolio can generate passive income during early retirement.
• Part-Time Work: Consider part-time or freelance opportunities to maintain cash flow while enjoying flexibility.

3. Government Support Schemes

• While there are no specific CPF provisions for early retirement, programs like the Silver Support Scheme and Workfare Income Supplement may offer financial assistance for low-income seniors who continue working part-time.

4. Personal Savings and Insurance

• Develop a disciplined savings habit early in your career.
• Explore private annuity plans or retirement-focused insurance products that provide additional monthly payouts.

For a comprehensive plan tailored to your circumstances, consult financial advisors and explore more insights on early retirement and CPF options via the CPF Board’s official resources page.

Taking proactive steps today to create a retirement plan that provides the financial confidence!

Planning for retirement is a journey that requires careful consideration of your financial resources, lifestyle aspirations, and long-term security. Retirement planning in Singapore involves understanding the interplay between retirement age, re-employment opportunities, CPF payouts, and various government support schemes. Careful planning and proactive engagement with these resources are crucial for a secure and comfortable retirement.