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How Much Do You Need To Earn Today To Meet CPF’s Minimum Sum When you Turn 55?

If, like most of us, you started working between 21 and 29, you would have approximately 30 years to save up for the retirement sum (RS). DollarsAndSense provides a guide to how much you should be earning today to stay in good financial shape!

To keep things simple, we have made some assumptions that will happen:

  • Your wage will grow by 3% every year!
  • Long-term inflation rate will be an average of 3%
  • You and your spouse start to pay for your 4-room HDB from 30 years old onwards
  • RS will increase in accordance with long-term average inflation rate

Exhibit 1: Minimum Monthly Wage Required Today

Age Full Sum: Min. Monthly Wage Full Sum @ 55 Enhanced Sum: Min. Monthly Wage Enhanced Sum @ 55 Expected   Medisave Required
21 $1,790 $439,837 $2,315 $659,755 $118,838
22 $1,860 $427,026 $2,400 $640,539 $115,377
23 $1,935 $414,588 $2,495 $621,882 $112,016
24 $2,015 $402,513 $2,595 $603,769 $108,753
25 $2,100 $390,789 $2,705 $586,184 $105,586
26 $2,190 $379,407 $2,825 $569,111 $102,511
27 $2,290 $368,356 $2,950 $552,535 $99,525
28 $2,400 $357,628 $3,090 $536,441 $96,626
29 $2,515 $347,211 $3,245 $520,817 $93,812
30 $2,645 $337,098 $3,420 $505,647 $91,079

Note: (1) Use your upcoming age as the age you started working, (2) Medisave Minimum Sum is $43,500, (4) Medisave Minimum Sum grows at 3% annually, (4) Uses male’s average marriage age at 30 years old as the time to purchase the 4-room HDB

Source: CPF, Singstats, DollarsAndSense


How much do I need to earn today to meet the Retirement Sum at 55 years old?

If you were to start working at the age of 25, you will need to have a minimum gross monthly salary of $2,100 and $2,705 to be able to meet the minimum Full RS and Enhanced RS respectively, when you are 55 years old.

If you have already started working for a few years, you can use this guide to give you an outlook on whether your current gross salary will to allow you to attain the Full/Enhanced RS.

This guide also allows you to assess your current situation. If you are 25 years old, and earning less than $2,100, you might want to make good use of SkillsFuture to upgrade yourself so as to obtain that wage increment.

What happens if I am not able to meet the Full/Enhanced Retirement Sum?

Fret not; our nation has not abandoned you. You have an alternative choice of the Basic RS, which most of us in Singapore will be able to meet at the age of 55 years old.

I am earning at/above the guide; I should be able to relax then?

  1. CPF LIFE (bought using the Full/Enhanced RS amount) should only be a part of your retirement planning and not the only aspect of it.
  2. After CPF contribution, at 25 years old, you will be bringing home $1,680 on a monthly basis.
  3. This guide just shows you how much you need to meet the RS, therefore you will only be able to withdraw $5,000 at age 55.

Based what the 3 points mentioned above, you should take more control of your financial position. Being relaxed just because you will be able to meet the RS may not provide you with adequate retirement monies to sustain you and your spouse.

You can read more at “Why you should always manage your CPF account!”.

In a nutshell

This guide provides an outlook of how much you should be earning today in order to meet the Full/Enhanced RS. However, it is bounded by the assumptions, and that it will not deviate too far away from it.

Being complacent about retirement planning today will always be costly in the future. The earlier you start, the more time you have and the easier it will be through the passage of time.

It might be long time before retirement, but DNS will be there, along the way, to provide more insights, to help you make it a slightly more fun and less ardous journey.

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