Article at:

http://www.straitstimes.com/business/invest/something-to-plan-for-when-youre-54

In the same article, they also provided a few examples on how much you can withdraw at the age of 55. I feel that this is quite useful and will share here with some of my comments:

SCENARIO 1

SCENARIO 1

Mr Raju's OA savings at age 55 amount to $100,000 while his SA savings are $180,000, which is a total of $280,000.

The Full Retirement Sum of $166,000 will be set aside in his RA, which will provide him with a monthly payout of $1,380 from age 65 for life.

He can withdraw the remaining amount of $114,000 in his OA and SA. If he owns a property with sufficient property charge/pledge, he can also choose to set aside his Basic Retirement Sum of $83,000 in his RA and receive a correspondingly lower monthly payout of $750 from age 65 for life. In this case, he can withdraw $114,000 from his OA and SA, and an additional $83,000 from his RA.

MadStranger:

This scenario is where the OA + SA exceeds the full retirement sum (FRS). In this scenario, you get to withdraw all balances above the FRS

If you own a property with sufficient pledge, you can set aside half the FRS which is also known as the basic retirement sum (BRS) instead. Your monthly payout will be reduced accordingly. Any amount above this BRS can be withdrawn.

**SCENARIO 2**

At 55, Mr Ahmad has $45,000 in his OA and $55,000 in his SA, or a total of $100,000.

From this, $95,000 will be set aside in his RA to form his retirement sum which will provide him with $840 monthly from age 65 for life. He can withdraw the remaining amount of $5,000 in his OA.

If he owns a property with sufficient property charge/pledge, he can choose to set aside his Basic Retirement Sum of $83,000 in his RA and receive a correspondingly lower monthly payout of $750 from age 65 for life. In this case, he can withdraw $5,000 from his OA, and an additional $12,000 from his RA.

MadStranger:

This scenario is where your OA + SA is lesser than the FRS but higher than 5k. In this scenario, you get to withdraw 5k.

If you own a property with sufficient pledge, you an set aside half the FRS which is also known as the basic retirement sum (BRS) instead. Your monthly payout will be reduced accordingly. Any amount above this BRS can be withdrawn.

**SCENARIO 3**

Mr Lim's OA savings are $25,000 while his SA savings are $35,000 - a total sum of $60,000.

An amount of $55,000 will be set aside in his RA to form his retirement sum which will provide him with $530 a month from age 65 for life.

He can withdraw the remaining amount of $5,000 in his OA.

MadStranger:

This scenario is where your OA + SA is lesser than the BHS but higher than 5k. In this scenario, you can only withdraw 5k.

**SCENARIO 4**

Mr Robert's OA savings at 55 are $3,000 while his SA savings amount to $1,000. As Mr Robert has less than $5,000, he can withdraw all the balances amounting to $4,000.

MadStranger: This scenario is where your OA + SA is lesser than 5k. In this scenario, you can withdraw the entire balance.