Are you worried about your retirement? Do you know if you are on track with your savings and investments for a comfortable retirement? Retirement planning can be overwhelming, but it doesn’t have to be! In this blog post, we will share three simple steps to determine if you are on the right path. So sit back and let’s share a cool tool for checking if you’re on track with your retirement planning!
Typically, many Singaporeans would use their CPF savings as the foundation for their retirement planning. When they turn 55, this is the time they can finally make cash withdrawals from their CPF. However, this is also the time when the Retirement Account (RA) will be created for you. This account will be funded from your OA and SA as seen in the diagram below.
The RA amount you choose will determine your post-65 monthly payout. The leftover from your RA will be the amount that you are eligible to withdraw at age 55. For retirement, one can pick one of these three different amounts. Basic Retirement Sum (BRS), Full Retirement Sum (FRS) and Enhanced Retirement Sum (ERS). The FRS is two times of BRS while the ERS is three times of BRS. Hence, one can pick between the FRS or ERS if they want to obtain a bigger monthly payout. You can check out the retirement amount that is applicable to us when we hit 55 on the CPF website .
Unsure if you can achieve these retirement amounts? A new feature named “CPF Projection ” was recently launched by DBS in their mobile application. Here, we’ll provide three quick steps with this feature to check your current retirement progress.
Retirement Planning Step 1: Sync your CPF with DBS via SGFinDex
Firstly, start by logging into your DBS Mobile App and head to the “Your Net Worth” section. Upon clicking into this, you will be headed into the DBS NAV Planner which will allow you to sync via SGFinDex.
Retirement Planning Step 2: Allow them to retrieve via SingPass
Provide DBS the permission to access your personal financial data through SGFinDex using your Singpass. By doing so, it will combine your finances across the seven participating banks (DBS, OCBC, UOB, Citibank and more). Additionally, the NAV planner will also be updated with information from your CDP account, HDB loan, and CPF balances. If you are uninformed of your current financial situation, this will give you a more thorough picture of it.
Next, head to the “CPF Projection” feature below.
Retirement Planning Step 3: CPF Projection at Age 55
Based on your current CPF amount and monthly contribution, DBS will project your CPF amount when one reaches 55. In my case, my CPF projection at the age of 55 will be at $1.1 million.
The excellent thing about this function is that it provides clarity on the retirement amounts and their monthly payouts. Hence, one can tweak your current savings habits to better meet your retirement goal. Furthermore, they do offer insights if your CPF projection falls just short of these retirement amounts.
Conclusion
This is a fuss-free way for you to do your retirement planning based on your CPF and savings. However, since we also do have down payments for homes, the figures above may not be a good representation. Furthermore, you might have foreign investments that are not tracked by SGFinDex, so this may not be a complete picture.
Retirement planning may seem overwhelming at first, but taking these three steps can help you get started. Checking your progress regularly allows you to make adjustments and keep moving forward. Remember that everyone’s financial situation is unique, so it’s essential to plan based on your own needs. Don’t wait until it’s too late to start planning for your future – take action today! By following these three steps, you’ll be well on your way to achieving a financially secure retirement.
If you wish to have an excel template to track your stocks and assets, check out our free template here.
If you are keen, check out our articles on other analysis: Trust Bank Referral, Ultimate Comparison Guide of Best SG Brokerage accounts for Singaporeans 2023 and Insurance you probably want to have.
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Disclaimer: The information provided by LearnToInvest serves as an educational piece and is not intended to be personalised investment advice. Readers should always do their own due diligence and consider their financial goals before investing in any stock.