|Transfer of CPF monies upon demise to their nominees' CPF Accounts|
|Written by Wilfred Ling|
|Sunday, 21 March 2010|
From January 2011, CPF Members can opt for their CPF monies to be transferred to their nominees’ CPF accounts upon the former’s demise. Currently, monies are paid in lump sum cash to the nominees. Next year onwards, this lump sum can be paid to the nominees’ CPF members. Why would anyone want to do that?
In most cases, nobody should be doing that. However, according to the FAQ HERE, it was stated that “This new option is introduced in response to public feedback that CPF monies could be transferred to nominees’ CPF accounts to better provide for their dependents’ retirement and healthcare adequacy.” Really? From my empirical observations, nobody likes to have their CPF monies lock up away for so long. I cannot imagine such monies been locked up for many generations. It does give the funny feeling that the monies in the CPF isn’t real money as big portion of it cannot be utilized.
There is one scenario which I think will be quite useful to have the CPF monies transferred to the nominees’ CPF. This is when the beneficiary is bankrupt. CPF monies are protected from creditors. So having CPF to CPF transfer upon death of the CPF member should offer asset protection for the beneficiary. Not sure will this work. Maybe someone can tell me when there is a real life case next time. Who wants to be the first to try out the system?
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