Yes there’s a part 3. Rather short this one.
1. Death - If someone passes away before the age of 55, it’s quite clear that all CPF monies go to the nominees. What happens someone passes away when the RA is created and invested (age 55-64) or when payouts start (age 65 and older)?
Context - Often one’s CPF becomes a sum of money one leaves behind as legacy.
Response - If someone passes away between age 55 and 64, all money put into the RA (when it was set up at age 55) goes to the nominees. This amount does not include any interest earned from CPF Life investment. Any balances in the in the OA and MA also goes to the nominees.
Once monthly payouts start (age 65 onwards), they are deemed to be drawn down from the principal (initial) amount when the RA was formed.
If someone passes away after monthly payouts start, any RA balance is based on what if left of the principal amount after the payouts have been subtracted.
When payouts deplete the principal amount, there is nothing left in the RA for anyone to inherit. (Though there may still be money in the OA and MA.)
Additional info - CPF nominations made before marriage are revoked and must be redone thereafter in consideration of new circumstances. Also if you make your nominations at a CPF office, the staff there can be witnesses. No need to bother your BFFs.
2. Top ups after 65 - Can someone top-up a million dollars into their RA?
Context - Is CPF Life a good way invest my money?
Response - No, you can't add a million dollars. There is a maximum based on the ERS limit. This also means there is a maximum monthly payout one can receive.
Any top-ups done after age 65 have a small impact to the monthly payout sums. For example, a $2000 top-up annually would provide for a $10 increase later (because the main investment period from age 55 to 64 has passed).
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So there's more I've found out from a PDF I was suggested to download from Havend. The PDF is 249 pages long so there's someone out there who's done way more research than I have.
One stand out from flipping through the document was learning that
- kids have CPF accounts set up when they are born.
- parents can top up their kids' accounts immediately, up to $8000 a year.
Parents who do make the annual top-ups stand to gift their kids', after all the accumulated interest and consolidation, about $500k when the munchkins turn 21! Talk about getting a headstart in life.
