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CPF ERS Amount Goes Up in 2025

CPF ERS Amount Goes Up in 2025

As part of the Budget announcement today, we learnt that the ERS (Enhanced Retirement Sum) is going up from 3x the Basic Retirement Sum to 4x the Basic Retirement Sum in 2025.

This will allow more members aged 55 and above to fully commit their accumulated CPF savings to receive higher payouts, should they wish to do so.

The key word is "Should they wish to do so" as ERS are a "nice to have" for people who can afford it. Property investors might not care as much if they rather put the money into properties and earn rental yields.

What is the current ERS figure

The current ERS as of yesterday for 2025 cohort was $319,500.

Now the latest figure given was "$426,000 in 2025, instead of $319,500".

Hence this article of mine (CPF Retirement Sum 2023 to 2027) published in Feb 2022, the table has to be changed.

The new ERS (Enhanced Retirement Sum) for 2025, 2026 and 2027 are

2025 : ERS is $426,000 (4*$106,500)

2026 : ERS is $440,800 (4*$110,200)

2027 : ERS its $456,400 (4*$114,100)

As a reference, the 2027 batch of cohort is the ones who were born in 1972. Me.

No More Special Account for 55 years old

Separately the government announced the "retirement" (pun intended) of the Special Account for people who turned 55. That means there will only be one "retirement account" when you turn 55.

The one true retirement account.

I can start to hear all the "CPF Shielding" screams already 😄

In fact, the Ministry of Finance said.... “As a principle, only savings that cannot be withdrawn on demand should earn the long-term interest rate, and savings that can be withdrawn on demand should earn the short-term interest rate”.

“Special Account shielding” is a tactic where CPF members prevent their savings from being transferred to the Retirement Account. That is done by investing money from the Special Account, then liquidating it shortly after.

At the time, the Manpower Ministry said only 2 per cent of CPF members did that. It also said it would monitor the trend and take action if necessary. 

I guess they took action 😸