One component of a legacy plan that is frequently neglected is CPF funds. Many people don’t realize that these CPF assets would be distributed according to intestacy rules or the Muslim Inheritance Certificate instead of their will because CPF funds are not considered part of the estate.
However, this distribution may not fit your preferences or accommodate your family’s demands. Neither the recipient nor the amount of your savings will be up to your discretion.
This is where the importance of the CPF nomination comes in.
CPF Nomination: What It Is and How It Works
CPF nomination lets you designate one or more individuals to receive your CPF savings upon your death. Some of the things included in your CPF nomination are:
- All of your CPF savings combined (including those in your Ordinary, Special, MediSave, and Retirement accounts).
- Unused contributions to CPF LIFE
You may make as many or as few changes as you like to your nomination. Nonetheless, here are several things your CPF nomination won’t cover:
- Properties purchased using a CPF account
- Investments through the Central Provident Scheme
- The money you get from the DPS (Dependents’ Protection Scheme)
The Importance of Making a CPF Nomination
1. Helps avoid conflicts within the family
Don’t let your CPF savings become a source of conflict in your family. Making a nomination guarantees that your wishes will be carried out in the way you want it. Please be aware that upon getting married, a person’s current CPF nomination will be nullified and a new nomination has to be made. Divorce, on the other hand, does not nullify your nomination.
2. Involves less hassle withdrawal transactions of CPF funds
Your nominees can easily have access to your CPF funds efficiently and without any hassle. However, it can take up to six months for the Public Trustee’s Office to determine who is entitled to your funds if you do not submit a nomination. There will also be a tacked-on administrative charge.
3. Gives you a peace of mind
Did you know that your CPF funds will be disbursed in accordance with your CPF nomination? This means you can rest easy knowing that your funds will be allocated as you intended, giving you the peace of mind that comes with knowing everything is taken care of. So, make sure to review your CPF nomination regularly and update it if needed.
When to Submit a Nomination for a CPF
Since you will be making monthly contributions to your three CPF accounts, it is most recommended to submit a CPF nomination as soon as possible after you begin working.
Many people believe that 20s and 30s are the best phases of life. The times when we are establishing our mark, coming into our own, and learning to navigate the adult world, where we have the energy and drive to follow our aspirations and the discernment to recognize what we want.
Essentially, life is never what you expect it to be. It can end in our nineties, our fifties, or even our twenties. It’s never too soon to start planning for your legacy, even before you’ve begun your financial journey or mastered money management. Who should inherit your property? Please specify how you would like your donation divided up. Is there enough being done to make sure they get where they need to go?
The answers you give to these questions today will determine your future, so don’t put them off until you’ve reached your parents’ retirement age.
Like your insurance policies, your CPF nomination may need to be updated as your life changes, such as after getting married, having children, or getting a divorce.
Using your Singpass, you can quickly and easily check your nomination status on the CPF Nomination website.
How to Submit a CPF Nomination Online or Physically
The first order of business is to track down the two people who will testify on your behalf that you submitted your nomination voluntarily and with full knowledge. They can’t be a proxy or a group you represent.
The following step is to choose between submitting a nomination online or physically. The former is highly recommended as it is easier and more efficient.
Online CPF Nomination Requirements:
- Nominees’ NRIC or Foreign Identification Number (FIN)
- Mailing address
- Email address
- Singpass in order to access the online CPF nomination system;
- The names, addresses, email addresses, and Singapore-registered mobile phone numbers of two witnesses, as well as their NRIC or FIN numbers.
It is necessary to fulfill the following for a CPF nomination to be submitted in person:
- Making an appointment (at least one business day in advance) with CPF;
- Bring in your NRIC or passport
- Bring in photocopies of your nominees’ identification documents
- Bring in two witnesses to sign your CPF nomination form (Witnesses can be provided by CPF’s Customer Service Representatives)
Your CPF nomination witnesses will be notified through SMS and/or email. Within a week, they must both use their unique SingPasses to access CPF’s Online Services and confirm their nomination.
If your nomination is approved, the CPF Board will send you an SMS or email to let you know.
Nominating for the CPF: It's Better to Do It Now Than Never
Our twenties and thirties are the prime of our lives, when we are both physically and mentally at our finest.
It’s a fact, though, that life is often full of unexpected twists and turns. You should submit an online CPF nomination as soon as you can if you haven’t already. After all, any time is better than never, and early is better than late.