5 Methods of Monetising Your Property for Retirement

Updated: Sep 5, 2020

As published in the Fund and Gains Section (October 2017) of PropertyGuru Newsletter.


For many of my clients, building wealth steadily and preparing for a comfortable retirement are the two most important financial goals they have set in their lives.


As a greying nation, this topic has become more commonly discussed in recent years and is set to be an even more significant topic in the years to come.


Whether clients are living in HDB flats, condominiums or landed properties, there are various ways that they can utilise their home equity saved up over the years to provide for a comfortable retirement.


In this article we will explore the options available to different segments of home owners.




For a HDB flat owner, there are 3 ways to unlock equity for retirement needs.


1. HDB Lease Buyback Scheme (LBS)


Goal:


This scheme helps flat owners to receive a stream of income in their retirement years while continue living in their properties.


How It Works:


Owners sell part of their flat’s lease back to HDB in return for proceeds that helps them top up their CPF Retirement Account to purchase a CPF Life Plan which pays them a monthly income for life.


Conditions:


This scheme is available to owners of 4 room flats or smaller who have met their MOP and are at least 64 years of age with no other properties.


At least one of the owners must be a Singaporean and monthly gross household incomes must not exceed $12,000.


The minimum tenure remaining must be at least 20 years. (Other terms and conditions apply)


2. Right Sizing Your Property with Silver Housing Bonus (SHB) Scheme


Goal:


Lower-income households get to unlock equity in their homes to provide them an income during their retirement years.


How It Works:


Owners get to enjoy up to $20,000 in cash when they sell their property and utilise part of their sales proceeds to top up their CPF Retirement Account and join a CPF Life Plan that pays them an income for life.