Despite the COVID-19 pandemic, 140,000 Central Provident Fund (CPF) members made S$3 billion in top-ups under the Retirement Sum Topping-Up Scheme (RSTU) – a notable 40 per cent higher than the amount of top-ups that were made in the year prior.
The CPF Board reported on Wednesday (3 Feb) that it saw a substantial increase in top-ups of S$1.2 billion in the last quarter of 2020 alone. Additionally of the 140,000 members who made top-ups in 2020, more than one-third were topping up for the first time. This is more than double the number of members who made first-time top-ups in 2019.
The highest increase was among members below 35 years old, which saw an 86 per cent increase from 2019.
The CPF Board also revealed that more members were topping up for their parents last year besides saving more for their own retirement, with a 27 per cent increase compared to the previous year.
One such CPF member – a Mr Lee who is in his 30s – said that he has been topping up his mother’s retirement account yearly for the past decade. On why he has been doing so, Mr Lee said:
“As a homemaker, my mother has little CPF savings. These top-ups earn attractive CPF interest rates and provide her with some security in her retirement years. At the same time, I also get to enjoy tax relief. So, it is a win-win situation.”
Welcoming the increase in the number of CPF top-ups, CPF Board’s Group Director from the Retirement Income Group, Mrs Tan Chui Leng said: “More members, especially young adults, are realising that topping up their CPF is a key part of their retirement plan. By topping up in January each year rather than December, members could earn 20% more interest on their CPF savings in just 10 years.”
She added: “As a parent myself, I am glad to see that children too are helping their parents boost their retirement savings by topping up for them.”
CPF members can enjoy up to S$14,000 in tax relief when they make top-ups for themselves and their loved ones. Top-ups need not be in a lump sum and can be made in small amounts via GIRO throughout the year. Visit the CPF website to find out more about the RSTU scheme.