How does the CPF LIFE Basic Plan work?
CPF LIFE Basic Plan is a legacy plan carried over from the time CPF LIFE was first introduced in 2009. Many members would find the Standard or Escalating Plan more suited to their needs.
The Basic Plan provides lower monthly payouts than the Standard Plan, and will get progressively lower when your combined CPF balances eventually fall below $60,000. This is because the extra interest earned on the first $60,000 of your CPF balances is credited to your Retirement Account (RA) and paid as part of your monthly payouts. As your balances decrease due to payouts, the extra interest earned and subsequent payouts will also decrease.
Under the Basic Plan, about 10-20% of your RA savings will be deducted as CPF LIFE premium when you join CPF LIFE, which can be any time from 65 to 70.
Your monthly payout will first be paid from your RA until 90. Thereafter, monthly payouts will be paid from your CPF LIFE premium. If your CPF LIFE premium is depleted, you'll continue to receive monthly payouts no matter how long you live.
