Since the start of 2025, seniors turning 55 will see their CPF Special Account closed. Instead of acting as a fourth CPF account, the Retirement Account will replace their Special Account.
At the same time, the Enhanced Retirement Sum (ERS) was also raised from 3x the Basic Retirement Sum (BRS) to 4x the BRS from 2025.
This means that from 2025, the ERS will rise from what it should have been, $319,500 (or 3x BRS), to $426,000 (which is 4x BRS). This move will take the estimated CPF LIFE payouts from $2,530 to $3,330 once individuals turn 65.
| Year | New ERS | CPF LIFE payout (on new ERS) |
Old ERS | CPF LIFE payout (on old ERS) |
| 2025 | $426,000 | $3,330 | $319,500 | $2,530 |
| 2026 | $440,800 | $3,440 | $330,600 | $2,610 |
| 2027 | $456,400 | $3,550 | $342,300 | $2,690 |
This move encourages Singaporeans to save more for our retirement within the CPF LIFE scheme, which will give us a lifetime monthly payout in our retirement, no matter how long we live.
One small drawback, though, may be the math of it. The maximum we can contribute to our Retirement Account (i.e. the ERS) increases 33.3%, but payouts will only rise 31.6%. This is a result of earning an extra 1% of interest on the first $60,000 of CPF savings, as well as seniors over 55 earning additional extra 1% of interest on the first $30,000 of CPF savings.
The ERS Will Continue To Increase Each Year – In Tandem With The BRS
As we can also tell from the table above, the Enhanced Retirement Sum (ERS) is not going to stay static. Each year, we can expect the ERS to rise in tandem with the BRS – which is raised based on long-term inflation, longer life expectancy and improvements in standard of living.
Today, we already know what the FRS (and by extension what the BRS and ERS) will be until 2027. From what we can tell, it used to increase by about 3.0% each year, and more recently has risen by about 3.5% each year.
| Year | BRS | FRS | ERS | Annual Increase |
| 2019 | $88,000 | $176,000 | $264,000 | 2.92% |
| 2020 | $90,500 | $181,000 | $271,500 | 2.84% |
| 2021 | $93,000 | $186,000 | $279,000 | 2.76% |
| 2022 | $96,000 | $192,000 | $288,000 | 3.22% |
| 2023 | $99,400 | $198,800 | $298,200 | 3.54% |
| 2024 | $102,900 | $205,800 | $308,700 | 3.52% |
| 2025 | $106,500 | $213,000 | $426,000* | 3.50% |
| 2026 | $110,200 | $220,400 | $440,800* | 3.47% |
| 2027 | $114,100 | $228,200 | $456,400* | 3.54% |
* ERS raised from 3x BRS to 4x BRS
From 2019 to 2022, the ERS increased around 3.0% each year. After that, the ERS increased about 3.5% each year (not accounting for the one-off increment of ERS from 3x BRS to 4x BRS in 2025).
We should not be too surprised if the ERS (and BRS and FRS) continues to rise at around the 3.5% range from now. Given the higher inflation today, this increment may also accelerate.
Read Also: 8 Things To Know About The CPF Enhanced Retirement Sum (ERS)
What Will The ERS Be When You Turn 55?
For anyone entering the workforce today, it’s hard to imagine hitting the ERS at nearly half a million dollars. Let alone the fact that it will continue to rise each year.
To get to our Enhanced Retirement Sum (ERS) when we turn 55, we simply have to multiply the current ERS by around 3.5% each year, or perhaps even take into account a slightly higher rate of increment.
For example, someone who enters the workforce today at 25 will have an ERS target of over $1.1 million.
| Age | Year | ERS | FRS | BRS |
| 24 | 2024 | $308,700 | $205,800 | $102,900 |
| 25 | 2025 | $426,000 | $213,000 | $106,500 |
| 26 | 2026 | $440,800 | $220,400 | $110,200 |
| 27 | 2027 | $456,400 | $228,200 | $114,100 |
| Based on 3.5% increments in retirement sums | ||||
| 28 | 2028 | $472,374 | $236,187 | $118,094 |
| 29 | 2029 | $488,907 | $244,454 | $122,227 |
| 30 | 2030 | $506,019 | $253,010 | $126,505 |
| 35 | 2035 | $600,992 | $300,496 | $150,248 |
| 40 | 2040 | $710,790 | $355,395 | $177,698 |
| 45 | 2045 | $847,758 | $423,879 | $211,940 |
| 50 | 2050 | $1,006,871 | $503,436 | $251,718 |
| 55 | 2055 | $1,195,846 | $597,923 | $298,962 |
To hit the ERS in the future, we all may need to be CPF millionaires by 55! The Basic Retirement Sum (BRS) – which can allow us to live a basic retirement in Singapore – may be significantly more reachable at $289,000.
Read Also: Here’s What Your CPF Full Retirement Sum Might Look Like When You’re 55
Can The Average Salaryman Ever Hit The ERS At 55?
The median salary of Singapore Citizens today is $4,667, and has been growing at an average of 3.9% each year in the last decade. As promised in the title of this article, we will determine whether such a person can ever reach the Enhanced Retirement Sum (ERS).
While it is not simple, there is a chance for an average worker to hit the ERS if they are actively working towards an enlarged retirement pot.
From the table below, we can see that an employee earning just the median income (and getting the average salary increment till 55), can achieve beyond the BRS at 55.
Through any combination of their SA and OA contributions or SA and making annual RSTU contributions, they can achieve beyond the FRS by 55.
They can hit beyond the ERS by combining both their SA and OA contributions. Of course, this scenario may be unlikely as many Singaporeans will have significant CPF savings locked up in our homes. That’s why right-sizing our flats in our old age can help us with our retirement adequacy.
| Age | SA Contributions | OA Contributions | Annual RSTU of $8,000 |
| 25 | $3,360 | $12,881 | $8,000 |
| 30 | $27,018 | $90,482 | $53,064 |
| 35 | $61,622 | $192,642 | $107,891 |
| 40 | $113,085 | $319,567 | $174,596 |
| 45 | $184,250 | $482,184 | $255,754 |
| 50 | $290,932 | $674,498 | $354,494 |
| 55 | $451,241 | $886,676 | $474,627 |
| Total | SA Contributions only: $451,241 (more than enough to hit beyond BRS) SA + Annual RSTU contribution of $8,000: $925,868 (more than enough to hit beyond FRS) SA + OA Contributions: >$1.3 million (enough to hit beyond ERS) |
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What If We Worked Until The Retirement Age Or Re-Employment Age
By about 2030, the Retirement Age will rise to 65 and the Re-employment Age will rise to 70. That clearly shows the expectation that more of us will be working till we hit these milestone ages.
| Age | SA Contributions | OA Contributions | Annual RSTU of $8,000 |
| 55 | $451,241 | $886,676 | $474,627 |
| 60 | $627,742 | $1,109,829 | $620,787 |
| 65 | $846,399 | $1,293,274 | $798,612 |
| 70 | $1,088,025 | $1,478,468 | $1,014,965 |
If we continue working into our Retirement and Re-employment Ages, we can potentially come close to our ERS with our SA contributions alone. Note that while the BRS is locked at 55, we can continue to save up to the new ERS levels each year they increase. In our example, we are looking at the ERS at the age we turn 55.
In this scenario, it is also not so out of the question that potentially combining our SA and OA balances of $2.33 million can afford us both a home and hitting the ERS of $1.2 million.
Finally, all of these calculations must be taken with a pinch of salt. They are simply forward projections based on statistics such as average growth in retirement sums and average salary growth. Individually, we may not be able to hit them. Specifically, the calculations also consider wage growth into our senior years, which may be even harder to achieve.
For those who want to contribute even more to our Retirement Account, we don’t have to be confined to the ERS for our cohort either. Instead, we can contribute even more – up to the prevailing ERS each year.
Read Also: BRS, FRS, ERS: Why There Are 3 CPF Retirement Sums & Why They Increase Every Year
The post How Much Salary Do You Need To Earn To Hit CPF ERS When You Turn 55 appeared first on DollarsAndSense.sg.
