CPF Top Up – How to Supercharge Your Retirement Funds & Avoid Being a Boomer

cpf top up

Mention CPF top ups, and you will hear very polarising views. These range from the highly opposing #returnourcpf camp, to very cult-like proponents of topping up your CPF Special Account (SA) to the maximum amount as soon as possible.

There is already a lot of discussion on this. However, I thought I’d weigh in with my own thoughts. If you’ve read my tutorial on how to build up your retirement war chest with a Bogleheads portfolio, you’ll realise it’s the only retirement plan you need.

Too many people convolute their retirement plans by having an assortment of investments like savings plans from various companies (i.e. ILP scams from insurance companies), buying property for poor rental yield and so on. Nevertheless, while concentrating on your Bogleheads portfolio is enough, I will add CPF LIFE as a secondary component for retirement (there is simply no good reason not to).

Resentment Among Singaporeans Against CPF (or the Government)?

Before I talk about how to optimise your CPF, I’d like to muse a little on the general anti-CPF sentiment in Singapore. I do find it hard to differentiate if people are against CPF itself, or against the Government. You will find that the two often goes hand-in-hand, but should not be confuddled. It is possible to dislike the Government (or specific political parties), but adopt an objective view of Government policies.

Having said that, I do not know the intricacies of all CPF policies. But I do know one thing – making the best out of any situation, if things are not within your control. Stephen Covey, in The Seven Habits of Highly Effective People, introduces the concept of Circle of Concern and Circle of Influence. The Circle of Concern is the area that we have no control over. The Circle of Influence is the area that we have control over.

Do the benefits of maximising the use of CPF as an effective retirement tool outweigh the ‘negative situation’ of not being able to outright change CPF policies as Singaporeans (e.g. grousing about why ‘I am forced to contribute to CPF?’, ‘why is the Government refusing to let me withdraw 100% of my CPF?’)? If not, why do people choose to be anti-CPF, without trying to milk the benefits (however inferior they think they are)? Surely, it is better to cast away feelings of bitterness for maximum gains. Let this irrationality sink in for a few moments.

CPF LIFE as a Supplement to the Bogleheads Retirement Fund

CPF LIFE (Lifelong Income For the Elderly) is Singapore’s national retirement plan. It helps retirees achieve lifelong income to support their financial needs in their golden years. Under this plan, you will receive monthly payouts for the duration of their life (for LIFE!). The payouts you get depends on how much CPF savings you have built up (there is a CPF LIFE payout calculator you can check out).

An Annuity Plan Unbeatable by Most Finance/Insurance Companies

​The payouts continue no matter how long you live, unlike most private retirement income plans that only do so for a limited period. CPF LIFE monies are also guaranteed by the Singapore Government, and provide high, risk-free returns of up to 6% p.a. Annuities offered by the private sector are subject to investment market returns.

Maximise CPF Growth Rate for Higher Payouts, and Legal Tax Dodges

Let’s put things into perspective. S$7,000 in cash topped up into your CPF SA today will be worth $18,500 at 5% growth in 20 years. What about doing this for 20 years? That’s a whooping S$261,000 you’ve just added to your retirement war chest. You would have missed out on this, if you had not done these yearly top ups. Of course, here at FIRE Singapore, we do not advocate working for 20 years, because that defeats the whole ideology of early retirement. That aside, you can top up a maximum of S$7,000 in cash per year into your CPF account to get a tax relief on your earned income.

Besides just topping up with cash, you can also choose to transfer surplus monies from your CPF Ordinary Account (OA) to your SA to get a higher interest. I personally transfer any extra monies in excess of S$10,000 (leaving some for my HDB mortgage payments) from my OA to my SA to build up my SA to the Full Retirement Sum (FRS) quickly. The goal is to hit your FRS as soon as possible. Once this is done, any yearly increase in the FRS ceiling will be automatically taken care of by the interest earn from your SA.

I guess, in the case of CPF in general, one can choose to hate the player (if they wish to), but not the game.


As mentioned earlier, there are already lots of great resources online, hence I do not wish to re-invent the wheel. I encourage you to find out more below!

  1. Complete guide to CPF LIFE: Facts, myths and how to make it work harder
  2. 1M65: How to Get $1 Million at 65 Using Your CPF
  3. Complete Guide To Understanding The “Benefit Illustration” Of CPF LIFE Payouts

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