What happens to your CPF, HDB Flat and your wealth when you die_

What happens to your CPF, HDB Flat and other forms of wealth when you die?

Alvin Chow
Alvin Chow

Singaporeans are pretty rich if you asked me. We have one of the highest property ownership percentage in the world.

This creates a first world problem: do your assets get distributed to your intended beneficiaries when you passed away?

What are the laws in place to see through this and the major implications?

Although this is an important topic, few people seem to pay much attention to it. I am not sure if it is a bad omen to talk about this, or most people just don’t think they would pass away any time soon. But accidents can happen and shouldn’t we plan for distribution once we have considerable wealth to give away?

Let us first run through a few laws or procedures that I was able to dig out.

CPF Nomination

CPF currently has a nomination scheme where every member can name an unlimited number of nominees. Only savings in the Ordinary, Special, Medisave and Retirement Accounts; and Discounted SingTel (ST) shares, will be distributed to the nominees.

It is important to note that CPF savings are NOT covered by the will.

Another important fact is that your nomination will be REVOKED upon marriage and fall back on intestacy laws. You have to nominate again if you wish to.

The following assets are NOT covered under the CPF Nomination:

  1. Cash and investments held in the CPF Investment Account under the CPF Investment Scheme-Ordinary Account (CPFIS-OA) – distributed according to laws governing the estate
  2. Investments held under the CPF Investment Scheme-Special Account (CPFIS-SA) – distributed according to laws governing the estate
  3. Dependants’ Protection Scheme (DPS) claim proceeds – arrangements with Great Eastern Life or NTUC Income
  4. Properties bought with CPF savings – These will be distributed according to the manner of holding. If the property is held as joint tenancy, the deceased’s share of the property will pass by operation of law to the remaining surviving owner(s). Otherwise, the deceased’s share of the property will form part of the deceased’s estate.

CPF is only one form of wealth. What happens to your shares in CDP, cash in bank accounts, fixed deposits, private properties, or even gold bars if you do not have a will?

It will be distributed under the intestacy law.

Intestate Succession Act

It is important to note that the Intestate Succession Act only applies to non-Muslims. Muslims would follow the Faraid or Islamic Inheritance Law.

Below are the distribution principles of the Intesate Sucession Act (The Act is quite difficult to understand and I found singaporelegaladvice.com’s simplified table much easier to read):

Spouse Children, parents Spouse gets everything
Spouse, children Spouse gets half, children gets the other half in equal portions
Children Spouse Children get everything in equal portions. Grandchildren can claim their parent’s share in equal portions if their parent is dead
Spouse, parents Children Spouse gets half, parents get half in equal portions
Parents Spouse, children Parents get everything in equal portions
Brothers and sisters (or children of the deceased brother or sister) Spouse, children, parents Brothers and sisters get equal portions. Their children can claim their share for them in equal portions if they are deceased
Grandparents Spouse, children, parents, brothers and sisters or children of such brothers and sisters Grandparents take the estate in equal portions
Uncles and aunts Spouse, children, parents, brothers and sisters or children of such brothers and sisters, grandparents Uncles and aunts take the estate in equal portions
None Everyone Government takes everything

Photo Credit: Martin Kelly

Alvin Chow
Alvin Chow
CEO of Dr Wealth. Built a business to empower DIY investors to make better investments. A believer of the Factor-based Investing approach and runs a Multi-Factor Portfolio that taps on the Value, Size, and Profitability Factors. Conducts the flagship Intelligent Investor Immersive program under Dr Wealth. An author of Secrets of Singapore Trading Gurus and Singapore Permanent Portfolio. Featured on various media such as MoneyFM 89.3, Kiss92, Straits Times and Lianhe Zaobao. Given talks at events organised by SGX, DBS, CPF and many others.
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