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4 days ago
- Business
- New Paper
DBS, OCBC and UOB to recognise CPF Life payouts as proof of income in credit card applications
Applicants for DBS, OCBC and UOB credit cards will be able to use their CPF Life payouts as proof of income under policy updates by the banks. Individuals aged 65 and above can do so when they apply for a DBS or OCBC credit card from June 11, while UOB plans to implement the policy in the near future. CPF Life, or CPF Lifelong Income For the Elderly, is an annuity that provides monthly payouts to people based on their savings in their CPF Retirement Account. They can choose to start their payouts from age 65 at the earliest. In formalising the process, DBS said in a statement on June 10 that while some banks do accept CPF Life payouts as income proof on a discretionary basis, the process remains lacking in transparency and assurance. Mr Calvin Ong, DBS' Singapore consumer banking head, said the bank has over 900,000 Singaporean or permanent resident customers aged 65 and above and knows how important CPF payouts are in supporting retirees' daily needs and aspirations. "By recognising the payouts as income, we're making sure seniors continue to have fair access to credit and the cards' accompanying privileges. This move ensures banking remains accessible and meaningful for our senior customers, so they can enjoy a fulfilling retirement," he said. OCBC Bank said in response to The Straits Times' queries that it will allow those aged 65 and above to apply for any OCBC credit card using CPF Life payouts as proof of income from June 11. Mr Joseph Wong, managing director of consumer credit risk management at OCBC, said the number of seniors applying for credit cards is generally low, as most retirees typically already have credit cards. "However, we hope this announcement puts to ease any concerns seniors may have about getting access to credit even after they have stopped working," he said. Ms Jacquelyn Tan, UOB's head of group personal financial services, told ST that the new policy will be implemented in the "near future", without specifying a timeline. More retirees will be able to benefit from the perks offered by UOB credit cards as they enjoy the fruits of their labour following retirement, she said. The banks' push comes as the Monetary Authority of Singapore (MAS) confirmed that CPF Life payouts can be considered by banks as an income source. MAS rules state that people over 55 must have an annual income of at least $15,000 when applying for unsecured loan facilities such as credit cards, even if they do not have a salary or traditional income. While MAS does not prescribe what income banks must consider when assessing a retiree's eligibility, it says regular payout streams such as rent, interest, dividends or annuity payments from CPF Life or similar products can be considered. Borrowers must prove that they are earning such income in order to qualify. For instance, those who hit the age of 65 in 2025 will receive monthly payouts of up to $1,300, or $15,600 a year, if they had set aside at least $161,000 as their full retirement sum a decade ago. Besides income, individuals over 55 can also qualify for credit cards if they have total net personal assets exceeding $750,000 or if they have a guarantor with an annual income of at least $30,000. The eligibility of older folk for credit cards was highlighted in The Straits Times Forum recently when a 64-year-old retiree wrote about having an existing card cancelled when he tried to increase its credit limit for an overseas holiday.
Yahoo
04-05-2025
- Business
- Yahoo
6 ways to protect your retirement savings from a recession
The stock market is down nearly 10% from its all-time high, based on S&P 500 returns through the end of April. A recession may be looming. There are times to sit back and admire the balance on your retirement account. This is not one of those times. If you are approaching retirement, or already there, you may be looking for ways to pad your savings. You may also be wondering how to avoid spending them, when they are already diminished. Take heart: There are ways to build savings in a depressed financial market, and ways to avoid drawing them down. Here are six tips from the experts. If you aren't strapped for cash, one way to boost retirement savings in a downturn is to set aside as much as you can in tax-favored accounts, including 401(k)s, IRAs and HSAs. The 401(k) already has high contribution limits, $23,500 in 2025. If you're near retirement, consider pushing your savings as close to the max as you can afford. Americans 50 and over can save even more with 'catch-up contributions,' which push the annual 401(k) limit to $31,000. A smaller subset of savers, in the 60-63 age range, get an even higher catch-up limit of $34,750, thanks to the SECURE 2.0 Act. 'People may not realize the importance of catch-up contributions,' said Maria Bruno, senior financial planning strategist at Vanguard. Individual Retirement Account contribution limits are lower: $7,000, or $8,000 for those 50 and older. An older worker might not see the point in maxing out retirement savings close to retirement, because the savings won't have as much time to grow. Keep in mind, though, that the savings don't stop growing when you retire. If you retire at 65 and live to 85, then those savings will continue to accrue interest for up to 20 more years. Think of your savings as an investment that will grow 'through' retirement, not just 'to' retirement, Bruno said. A Health Savings Account is another potential tool to build retirement savings. The annual limit is $8,550 for a family in 2025, and people over 55 can contribute another $1,000. You can save any money you don't spend. 'Ideally, you want to think of that as a retirement account,' Bruno said. For long-term retirement savers, a depressed market spells opportunity to buy stocks at a discount. Automating your retirement contributions is a good way to keep buying through the downturn. It 'keeps you consistent and takes emotion out of investing,' said Michelle Crumm, a certified financial planner in Ann Arbor, Michigan. If your contributions aren't automatic, you might miss out on buying equities on the cheap. 'When markets are down, too many people freeze,' Crumm said. If you are on the eve of retirement, perhaps the last thing on your mind is working another year or two. But postponing your retirement, even by a year or two, can be a powerful tool for building retirement savings. A Stanford University study found that delaying retirement by just three to six months has the same impact on retirement savings as raising your 401(k) contribution rate by a full percentage point for 30 years. Let's say you put off retirement for a year. In that year, you can max out retirement savings, potentially adding tens of thousands of dollars to your account. And you won't be drawing down your savings, which means they'll last longer once you do retire. 'It allows for continued income. You get savings from that income, while delaying portfolio withdrawals,' Bruno said. Staying in the workforce is especially attractive in a down market: It means you won't have to raid your retirement savings while their value is depressed. The downside to working longer is that you'll have less time to enjoy your retirement later. As a compromise, consider working part-time. 'This way, your nest egg doesn't take as large of a hit in those first years of retirement,' said Colin Day, a certified financial planner in St. Louis. And a part-time schedule 'provides you with more flexibility to do the things you enjoy.' The closer your retirement date, the more likely you will soon need to tap your savings for living expenses. Ideally, you should have some of those savings in cash. A wise goal, retirement experts say, is to amass at least a year's worth of living expenses in cash or cash-equivalent accounts, such as high-yield savings or money market funds. 'These dollars will be the first that you will deplete to generate your new retirement paychecks,' said Heather Winston, head of product strategy, individual solutions at Principal Financial Group. Cash is especially important in a downturn, so you can avoid selling depressed investments. One trusty way to pad retirement savings is to shift your focus from spending to saving. 'Start by separating nonessential expenses from essential expenses,' said Niv Persaud, a certified financial planner in Atlanta. 'Pause spending on non-essential expenses, even if that means your adult kid needs to pay their own mobile phone bill. Shift money you would have spent on non-essential items to your retirement savings.' And look for other ways to trim your expenses, Crumm said. 'Small adjustments today – refinancing insurance, downsizing subscriptions, paying off high-interest debt – can reduce the income you'll need in retirement,' she said. 'That means you'll be able to withdraw less from your investments during down markets, giving your portfolio more time to recover.' Think of this tip as protection against future downturns. If you wait to claim Social Security, your monthly check gets larger. Your benefit rises in value every year you wait, from age 62 to 70. 'If you can use other assets to bridge the gap, delaying Social Security can act as a form of longevity insurance, providing more guaranteed income,' Crumm said. A larger check can be especially helpful 'if your portfolio's growth is temporarily stalled,' she said, as in a down market. This article originally appeared on USA TODAY: 6 ways to recession-proof your retirement savings Sign in to access your portfolio
Yahoo
04-05-2025
- Business
- Yahoo
6 ways to protect your retirement savings from a recession
The stock market is down nearly 10% from its all-time high, based on S&P 500 returns through the end of April. A recession may be looming. There are times to sit back and admire the balance on your retirement account. This is not one of those times. If you are approaching retirement, or already there, you may be looking for ways to pad your savings. You may also be wondering how to avoid spending them, when they are already diminished. Take heart: There are ways to build savings in a depressed financial market, and ways to avoid drawing them down. Here are six tips from the experts. If you aren't strapped for cash, one way to boost retirement savings in a downturn is to set aside as much as you can in tax-favored accounts, including 401(k)s, IRAs and HSAs. The 401(k) already has high contribution limits, $23,500 in 2025. If you're near retirement, consider pushing your savings as close to the max as you can afford. Americans 50 and over can save even more with 'catch-up contributions,' which push the annual 401(k) limit to $31,000. A smaller subset of savers, in the 60-63 age range, get an even higher catch-up limit of $34,750, thanks to the SECURE 2.0 Act. 'People may not realize the importance of catch-up contributions,' said Maria Bruno, senior financial planning strategist at Vanguard. Individual Retirement Account contribution limits are lower: $7,000, or $8,000 for those 50 and older. An older worker might not see the point in maxing out retirement savings close to retirement, because the savings won't have as much time to grow. Keep in mind, though, that the savings don't stop growing when you retire. If you retire at 65 and live to 85, then those savings will continue to accrue interest for up to 20 more years. Think of your savings as an investment that will grow 'through' retirement, not just 'to' retirement, Bruno said. A Health Savings Account is another potential tool to build retirement savings. The annual limit is $8,550 for a family in 2025, and people over 55 can contribute another $1,000. You can save any money you don't spend. 'Ideally, you want to think of that as a retirement account,' Bruno said. For long-term retirement savers, a depressed market spells opportunity to buy stocks at a discount. Automating your retirement contributions is a good way to keep buying through the downturn. It 'keeps you consistent and takes emotion out of investing,' said Michelle Crumm, a certified financial planner in Ann Arbor, Michigan. If your contributions aren't automatic, you might miss out on buying equities on the cheap. 'When markets are down, too many people freeze,' Crumm said. If you are on the eve of retirement, perhaps the last thing on your mind is working another year or two. But postponing your retirement, even by a year or two, can be a powerful tool for building retirement savings. A Stanford University study found that delaying retirement by just three to six months has the same impact on retirement savings as raising your 401(k) contribution rate by a full percentage point for 30 years. Let's say you put off retirement for a year. In that year, you can max out retirement savings, potentially adding tens of thousands of dollars to your account. And you won't be drawing down your savings, which means they'll last longer once you do retire. 'It allows for continued income. You get savings from that income, while delaying portfolio withdrawals,' Bruno said. Staying in the workforce is especially attractive in a down market: It means you won't have to raid your retirement savings while their value is depressed. The downside to working longer is that you'll have less time to enjoy your retirement later. As a compromise, consider working part-time. 'This way, your nest egg doesn't take as large of a hit in those first years of retirement,' said Colin Day, a certified financial planner in St. Louis. And a part-time schedule 'provides you with more flexibility to do the things you enjoy.' The closer your retirement date, the more likely you will soon need to tap your savings for living expenses. Ideally, you should have some of those savings in cash. A wise goal, retirement experts say, is to amass at least a year's worth of living expenses in cash or cash-equivalent accounts, such as high-yield savings or money market funds. 'These dollars will be the first that you will deplete to generate your new retirement paychecks,' said Heather Winston, head of product strategy, individual solutions at Principal Financial Group. Cash is especially important in a downturn, so you can avoid selling depressed investments. One trusty way to pad retirement savings is to shift your focus from spending to saving. 'Start by separating nonessential expenses from essential expenses,' said Niv Persaud, a certified financial planner in Atlanta. 'Pause spending on non-essential expenses, even if that means your adult kid needs to pay their own mobile phone bill. Shift money you would have spent on non-essential items to your retirement savings.' And look for other ways to trim your expenses, Crumm said. 'Small adjustments today – refinancing insurance, downsizing subscriptions, paying off high-interest debt – can reduce the income you'll need in retirement,' she said. 'That means you'll be able to withdraw less from your investments during down markets, giving your portfolio more time to recover.' Think of this tip as protection against future downturns. If you wait to claim Social Security, your monthly check gets larger. Your benefit rises in value every year you wait, from age 62 to 70. 'If you can use other assets to bridge the gap, delaying Social Security can act as a form of longevity insurance, providing more guaranteed income,' Crumm said. A larger check can be especially helpful 'if your portfolio's growth is temporarily stalled,' she said, as in a down market. This article originally appeared on USA TODAY: 6 ways to recession-proof your retirement savings Sign in to access your portfolio
