INCREASE IN CPF MINIMUM SUM, MEDISAVE MINIMUM SUM AND MEDISAVE CONTRIBUTION CEILING
	News Release by: Central Provident Fund Board 07 June 2007 --
	CPF Minimum Sum
	From 1 July 07, the CPF Minimum Sum (MS) will be increased from $94,600 to $99,600. The new amount will apply to CPF members who turn 55 between 1 July 07 and 30 June 08. CPF members who set aside the $99,600 fully in cash will receive a monthly payout of $790 from age 62 for about 20 years.
	This increase is in line with the announcements made in August 03 that the CPF MS will be raised gradually to reach $120,000 (in 2003 dollars) in 2013. The increase in MS, which includes an adjustment for inflation, is to ensure that Singaporeans set aside sufficient savings for their retirement. Please refer to Annex A for examples on what happens when members reach age 55 and how the MS scheme works.
	Medisave Minimum Sum and Medisave Contribution Ceiling
	From 1 July 07, the Medisave Minimum Sum (MMS) will be increased from $28,000 to $28,500. Members will have to set aside this amount, or the actual Medisave balance, whichever is lower, in their Medisave Account, when they withdraw their CPF at or after 55 years old. The Medisave Contribution Ceiling (MCC) will be also raised from $33,000 to $33,500. This is the maximum balance each member may have in his Medisave Account. As announced previously, any Medisave contribution in excess of the prevailing MCC will be transferred to the member’s Special Account if he is below age 55. If he is above age 55, the Medisave contribution in excess of the prevailing MCC will be transferred to his Retirement Account if he has a Minimum Sum shortfall. The revisions to MMS and MCC are to ensure that Singaporeans have sufficient savings to meet their hospitalisation expenses, and have been adjusted for inflation.
	PUBLIC ENQUIRIES
	For more information, please visit www.cpf.gov.sg or call the CPF Call Centre at 1800-227 1188.
	ANNEX A
	Example 1 Member A turns 55 on 11 July 2007. He can withdraw his CPF after setting aside the CPF Minimum Sum (MS). The MS applicable to him is $99,600. His current balances are as follows:
	Special Account (SA) Ordinary Account (OA) Medisave Account (MA) $80,000 $150,000 $33,500 (note: this amount is also the Medisave Contribution Ceiling (MCC))
	On 11 July 2007, he reaches age 55. The MS applicable to him is $99,600. The Board will create a new account for him called the Retirement Account (RA), which will be used to set aside his MS.
	The MS is drawn from his balances in his SA and OA. In his case, his entire SA balance of $80,000 will be transferred to his RA to meet part of the MS of $99,600. The remaining $19,600 will be taken from his OA savings and transferred to his RA. He can choose to withdraw the remaining amount of $130,400 in his OA.
	His balances when he reaches 55 will be as follows:
	SA OA MA Retirement Account (RA) $0 ($80,000 - $80,000) $130,400 ($150,000 - $19,600) $33,500 $99,600 (made up of $80,000 from his SA and $19,600 from his OA)
	At age 55, he is also required to set aside the Medisave Minimum Sum (MMS) of $28,500, or the actual balance in his MA, whichever is lower. In this case, after retaining the MMS of $28,500, he can withdraw the amount in excess, ie. $5,000. He can withdraw the entire OA balance of $130,400.
	Assuming he makes these withdrawals, his balances will be as follows:
	SA OA MA RA $0 $0 (after withdrawing $130,400) $28,500 (after withdrawing $5,000) $99,600
	Example 2 Member B turns 55 on 1 August 2007. He does not have sufficient savings in his OA and SA to meet the full MS of $99,600. The MS applicable to him is $99,600. His current balances are as follows:
	Special Account (SA) Ordinary Account (OA) Medisave Account (MA) $30,000 $50,000 $10,000
	On 1 August 2007, he reaches age 55. The MS applicable to him is $99,600. The MS is drawn from his balances in his SA and OA to create his new Retirement Account. In his case, as he has insufficient balance to set aside $99,600, 50% of his SA and OA savings will be used to set aside his MS.
	His balances when he reaches 55 will be as follows:
	SA OA MA Retirement Account (RA) $0 ($30,000 - $30,000) $40,000 ($50,000 - $10,000) $10,000 $40,000
	He can withdraw the remaining OA balance of $40,000. As there is a shortfall in his MS, for subsequent withdrawals, he will only be able to withdraw half of the new contributions he receives. The remaining half of the contributions will be channeled to his RA to make up the required MS.
	Note: If a member has less than $5,000 in his OA and SA at age 55, he will be able to withdraw all the monies without setting aside the required MS. However, for subsequent withdrawals, he will be required to set aside 50% of the withdrawable savings in his RA until he meets his required MS.