22 July 2019

End of Life - What happens to the CPF?

While we are still growing up in our twenties, CPF is just a 'sinkhole' where part of our salary ends up in. Goes in, never come out.

Over time though, as we progress towards our thirties, it becomes the source upon which we can only be glad that there is money to help pay for our housing.

And when you are getting closer towards retirement in your forties, you think about how to accelerate the build-up of CPF to get the desired retirement funds desired. As well as tax-deductible top-ups to reduce the burden of taxation.

In our fifties, we start to want to know how the CPF money will fund CPF LIFE to support our retirement.

By the sixties, we are looking forward to finally collecting CPF LIFE payouts.

But what about upon death? I know it's morbid. But that is really something important to take care of as well. A CPF nomination needs to be made to determine how the CPF money would be distributed.

What's the significance?

A CPF Nomination covers:
  • CPF savings in the Ordinary, Special, Retirement and Medical Accounts
  • Unused CPF Life premiums
  • Discounted SingTel shares
A CPF Nomination does not cover:
  • Properties bought using CPF 
  • Payouts from Dependent Protection Scheme
  • Investments in CPF Investment Accounts - i.e. CPFIS-OA and CPFIS-SA.
Well, years ago, Pa and Ma both did their respective CPF nominations. That was a good thing. Trouble is, nobody knew who they actually nominated!  Over time, we did eventually figure out that they had nominated each other. Perhaps they should have told somebody or have the information attached to a Will for reference?

When Pa passed away some years back, CPF Board automatically issued a cheque of the balance left in his CPF in Ma's name and sent to her home address. No actions were required from anybody. Apparently, when the death certificate was applied, it automatically triggered notices to various government agencies, including CPF Board. And CPF Board took action to process accordingly and the nominee would receive a cheque within two weeks.

More recently, Ma passed away too. Unfortunately, her nominee was my Pa. So how?  Since he was no longer around.

  • We looked around for a recent copy of her CPF statement. Took a while to find it.  There wouldn't even be one if you had accepted the paperless option! The CPF statement would indicate if she had made a nomination, and in which year. So that was a clue.
  • We considered checking her CPF online, but she didn't even have a Singpass account to begin with! Best to have one. 

Well, apparently, if the nominated parties are no longer alive, the CPF money gets transferred to the Public Trustee who will investigate and distribute the money according to the Intestate Succession Act. That would take about 2 to 4 months to conclude, and there is some fee involved. It takes a bit longer. I hope it works out.

Related Information:
For a quick overview: CPF Pamphlet on Losing Loved One
And for more details: CPF Guide on Preparations for Death
If you're hearing some nonsense, read this: Government Debunks False Message
For a quick idea of the Intestate Succession ActDealing with the CPF Monies of Someone Who Has Passed Away


Unknown said...

Thank you. Very constructive indeed.

Unknown said...

I think on the safer part is to nominate the one u want them to have your money when u kick the bucket be wise when doing the nomination.

Lizardo said...

I agree. By nominating, we can be assured that what we want is executed. But have to remember to redo nomination if circumstances change.

Unknown said...

Also remember to ell your nominee about the nomination, nothing to hide fm them.
They will be closer to you knowing that they will get the money when you die.

Lizardo said...

Probably more to gain than lose by informing the nominees.