INCREASING NUMBER OF SINGAPOREANS ARE TOPPING UP CPF ACCOUNTS OF THEIR LOVED ONES.

S Ramesh of Channel News Asia reported that an increasing number of Singaporeans are topping up the CPF accounts of their loved ones:

The number of Singaporeans taking part in the Minimum Sum Topping-Up scheme last year rose 24 percent compared to 2009, says the Central Provident Fund Board.
For the Tan brothers, the well-being of their 72-year-old mother, a housewife, has been top priority.

So the two brothers have taken advantage of the scheme to contribute to their mother’s CPF account.

Said Johnny Tan: “For me, it’s a priority to spend for my parents first, then you can spend in other ways.”

Said Tan Wen He: “To me, personally, family bonding is very important. By topping up my mother’s CPF account, I can show as an example to my children. So the young children can learn (from) this good example when they grow up.”

The scheme has also been useful for those who want to contribute to the accounts of their siblings.

Mr Lim Choon Kok said: “My sister, all the while, is a housewife, does not have much in her CPF. So when I top up for her, when she reaches the age of 62, there is some money in her CPF.

“Also, on my part, I can claim income tax rebate, which is beneficial for both of us – my sibling and myself.”

Singaporeans, who make cash top-ups into their own and their family members’ Special or Retirement Accounts, can enjoy up to S$14,000 tax relief per calendar year.

In all, for 2010, there were nearly 30,000 transactions of CPF top-ups.
That’s nearly S$250 million or 9 percent more than in 2009.

The CPF Board says top-ups into parents’ Special or Retirement Accounts were most popular.

Nearly 60 percent of all top-ups made last year went into the parents’ accounts.

The CPF Board says the growing number of top-ups shows that the scheme is popular.

More CPF members also understand how it helps them and their family members save for their retirement.

Said Soh Chin Heng, deputy CEO of CPF Board: “I would recommend that they consider signing up for this top-up on a GIRO basis. They don’t have to commit to a big sum at one go. They can top up a small sum every month and it is manageable. We already now allow them to do so.”

The scheme started in 1987, with the aim to help CPF members enhance their retirement savings by encouraging them to top up their own or family members’ Special or Retirement Accounts using their Ordinary Account savings or cash.

Recipients also enjoy up to 5% interest on their CPF savings which helps build up their retirement nest egg.

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