What does a CPF nomination NOT cover — what assets are excluded?

CPF Nomination Exclusions

A CPF nomination, while powerful as it overrides a Will or Trust regarding CPF monies (CPF Board rule 1), does not cover all assets associated with your CPF accounts or related schemes. There are three specific categories of assets that are explicitly excluded from the CPF nomination process:

• CPF Investment Scheme (CPFIS) Holdings: Any monies invested under the CPFIS are not covered by the CPF nomination. If you have utilized your CPF funds to invest in stocks, bonds, or unit trusts, these investments must be covered separately, typically through your Will or Trust (CPF Board rule 2).

• Designated Policy (DPS) with Great Eastern (GE): If you have purchased a Designated Policy under the CPF scheme with Great Eastern, this policy must be nominated directly with Great Eastern, not through the standard CPF nomination form (CPF Board rule 2).

• Property Purchased Using CPF: Real estate purchased wholly or partially using CPF savings is not governed by the CPF nomination. The distribution of the property upon death follows the instructions in your Will or the laws of intestacy if no Will exists (CPF Board rule 2). This is crucial, especially if you have pledged property at age 55 to withdraw from your Retirement Account (RA).

Key Takeaway on Liquidity and Payouts:

It is important to note that while the nomination dictates who receives the balance, it does not change how the funds are accessed. For example, money in the Retirement Account (RA) is permanently locked into CPF LIFE payouts starting from age 65, regardless of who is nominated. Furthermore, interest earned after you start payouts goes into the CPF LIFE pool, and only the remaining principal balance (plus accrued interest before payouts) is distributed according to the nomination upon death, depending on whether the initial RA balance was exhausted (CPF LIFE pooling clarification).