How Much CPF Balances Do I have Compared To My Peers?

Central Provident Fund Board (‘CPF’) have just published its Annual Report 2020. Of particular interest to many CPF members would be Annex F which provides the distribution of all CPF members by regrossed balances and age group. That’s right, for those who have often wondered how much CPF balances they have as compared to their peers, the answers can be found in the Annual Report. I have read the Annual Report and produced some analysis for curious CPF members.

Distribution of All CPF Members by Regrossed Balances and Age Group

Diagram 1 shows the distribution of all CPF Members by Regrossed Balances and Age Group as at 31 Dec 2020.

Diagram 1 shows the raw data in a tabular form. I am no Data Science student, so my first intuition is to segment the distribution in percentage terms and present them in a graph as shown in Diagram 2. This makes analysis much easier.

How To Interpret The Graph

The first layer of segmentation is by age group and they are laid out in bands on the X-axis. The other layer of segmentation is regrossed balances, which include amounts withdrawn under Investment, Education, Residential Properties, Non-Residential Properties and Public Housing Schemes as at end of period. Since it refers to only amounts withdrawn, do not add unrealised capital gains/losses from your investments (eg: the paper gains from investing your CPF funds via Endowus)

Here is a step-by-step guide on how you can interpret Diagram 2.

Step 1: To calculate your Regrossed Balances, start by checking your 31 Dec 2020 ending combined balances (Ordinary Account + Special Account + Medisave + Retirement Account) by logging into my cpf online services using your Singpass. Go to My Statement > Yearly Statement of Account under Section B > select Year “2020” as shown in Diagram 3.

Step 2: Add the amounts you have withdrawn for Investment, Education, Property. This can be retrieved from Section C. Note that the amount shown here is as at the login date, so do add/subtract the amounts returned/withdrawn to obtain 31 Dec 2020 balances.

Step 3: Now that you have calculated your Regrossed balances, refer to the Legend on the right side of Diagram 2 so that you know which colour code your regrossed balances belong to.

Step 4: Finally, your age group should fall into one of the columns on the X-axis. That will be the relevant column to refer to when looking for your colour code.

Step 5: Note that the data label within the corresponding colour-coded graph is simply the percentage of people within the age band who had the specific range of regrossed balances. It is not a cumulative number. Therefore, to understand where you truly stand, you have to add up all the rows below your colour code in that column.

Here is an example of a 36-year-old CPF member who had engrossed balances of S$130,000 as at 31 Dec 2020. The colour code under the Legend would be yellow. Therefore, he is amongst the 37^th percentile (10.4% + 4.8%+ 4.5%+ 4.4%+ 4.3% +4.3% + 4.4%) in that year.

A quick and dirty way would be to interpret the Y-axis which would let you know whether you are in the 10^th -20^th percentile, 20-30^th percentile and so on.

Interesting Insights from CPF Annual Report 2020

Here are some interesting insights that I have gathered from reading the CPF Annual Report 2020.

• Several hundreds of CPF members who are yet to reach the legal age to vote have accumulated amounts that already exceed the prevailing Full Retirement Sum (‘FRS’). These children must have been blessed with their parents’ decision to top up their CPF accounts very early on their lives. Hopefully, this is a massive headstart in their financial journeys that they do not subsequently squander away. I am doing something similar for my daughter but I have only chosen to top up her MediSave (‘MA’) account with her angbao money thus far.
• Since age 55 is the money that one can start withdrawing their CPF balances, I paid particular attention to the movement between the age groups of 50-55 and 55-60. 26.7% of those aged 50 to 55 have regrossed balances of $500K and above but this drops to 19.5% for those aged 55 to 60. This change is the most dramatic as compared to others in the same cohort but with different regrossed balances. I could only think of the following rationale behind this move:

1. They are withdrawing their monies from the CPF system to either enjoy their fruits of labour
2. Better diversify their holdings and not put all the eggs in one basket (CPF). Do note that once money is withdrawn from the CPF ecosystem, it will be almost impossible for this ultra-wealthy group to put funds back except via mandatory contribution due to employment.

Conclusion of CPF Regrossed Balances

I would treat this exercise as a short and fun weekend activity. It is good to know where you stand in your cohort, but I wouldn’t encourage anyone to dwell too much over it as it could become unhealthy. Instead, it may be better to focus on real role models that serve as motivation for you to work harder and do better. For my case, I have a family member who has inspired me with his CPF journey! This has allowed me to finally reach my MediSave limit in 2021!