Which CPF topic are you the most concerned about?
Singapore’s unique CPF scheme has been in place for 70 years.
It has helped countless Singaporeans enjoy their golden retirement years, but has also faced some doubts from time to time.
What questions do you have about the CPF scheme? How can you boost your CPF savings?
Prime Minister and Minister for Finance Lawrence Wong, Minister for Manpower and Second Minister for Trade and Industry Tan See Leng and other heavyweights will answer your questions.
Why does Singapore need the CPF scheme?
Official Launch of the CPF scheme
CPF’s primary objective is to provide retirement security for Singaporeans.
At that time, apart from the government and large companies, most employers did not provide retirement benefits for their employees. Employees had to rely on their own savings upon retirement, but most did not have sufficient funds.
Under the earliest CPF scheme, workers and employees had to contribute 5% of their monthly salary to their CPF, capped at a sum of $50, and could withdraw their CPF savings at the age of 55.
Public Housing Scheme
Allowing the use of CPF savings to buy the public flats built by HDB and JTC, established the CPF as a key enabler of home ownership for Singaporeans.
Special Account
Members could deposit part of their CPF savings into an account designated for retirement purposes, to ensure that they do not use up their CPF funds before retirement.
In 1977, members could not access the funds in their Special Account before they turned 55, unless there were special reasons such as death or serious illness. CPF was later divided into Ordinary and Special Accounts.
MediSave Account
CPF can now be used for healthcare purposes. Members can use their MediSave Account to pay for their own or family members’ medical expenses.
Approved Investment Scheme
Members were allowed to use part of their CPF savings for investment, including buying gold, or approved listed companies, unit trusts and stocks. Over time, this evolved into today’s CPF Investment Scheme.
Minimum Sum Scheme
A portion of the member’s CPF savings is set aside for this scheme, and after they reach the retirement age of 55, the money will be given in the form of monthly payouts to cover their living expenses in the long run.
Previously, members could withdraw all their CPF savings when they turned 55. However, with Singaporeans living longer, withdrawing all the money increases the risk of members outliving their CPF savings.
In the same year, the government also started to allow members to top up their own or parents’ Retirement Accounts with cash or CPF savings if the existing balances were insufficient.
CPF Education Scheme
Members can use their CPF savings to pay for their own or children’s higher education tuition fees.
MediShield Scheme
An optional health insurance plan where members can use their MediSave to pay for the premiums.
(MediShield was replaced by MediShield Life in 2015.)
Transfers between accounts allowed
Members can transfer funds from their OA to SA, up to a maximum of $40,000, thereby increasing their savings available for retirement. The SA’s interest rate is 1.5 percentage points higher than the OA’s. The CPF Board subsequently set a floor rate of 4% per annum for the SA in 2008.
ElderShield Scheme
A non-compulsory severe disability insurance scheme that members are automatically enrolled in when they turn 40. The premiums are paid by MediSave, and Singaporeans can make claims in the event of severe disability.
(This scheme was replaced by CareShield Life in 2020.)
Workfare Income Supplement scheme
Mainly targeted at workers whose earnings are in the bottom 20%, wage supplements and CPF top-ups are provided to ensure that lower-wage workers have adequate retirement savings.
CPF LIFE
Official launch of a lifetime insurance annuity scheme that provides retired members with monthly payouts for the rest of their life, so that they never have to worry.
Pioneer Generation Package
Annual MediSave top-ups were provided for the Pioneer Generation in 2014, as well as higher outpatient care subsidies to help these seniors lower healthcare costs.
Silver Support Scheme
Quarterly cash supplement were given to seniors who had low incomes during their working years and now have less in retirement.
When introduced in 2016, eligible seniors aged 65 and above received up to $750 every quarter, an amount which increased to $900 in 2021 and $1,080 in January 2025.
Merdeka Generation Package
The Merdeka Generation received $200 in MediSave top-ups annually from 2019 to 2023. The Government also provided higher subsidies for their outpatient treatments.
Majulah Package
Support for eligible working Young Seniors born in 1973 or earlier, by providing an Earn and Save Bonus of up to $1,000 a year. Those with CPF savings below the Basic Retirement Sum also received a one-off Retirement Savings Bonus.
All Singaporeans born in 1973 or earlier also received a one-time MediSave Bonus.
Closure of Special Account
CPF members aged 55 and above used to have both a Special Account and a Retirement Account. To ensure that the CPF scheme remains fair, starting from 19 January 2025, members aged 55 and above will only retain their Retirement Account, which will continue to enjoy a higher long-term interest rate.
The following have been enhanced in 2025:
- Increase CPF contribution rates for senior workers
- Silver Support Scheme: The maximum average monthly household income increased from $1,800 to $2,300; the quarterly payout increased by 20%, ranging from $215 to $1,080.
- Workfare Income Supplement Scheme: Qualifying monthly wage cap raised from $2,500 to $3,000; Eligible employees can receive up to $4,900 per year in payments.
- Matched Retirement Savings Scheme: Grant cap increased from $600 to $2,000; age cap of 55 years old lifted, members above 55 years old can also benefit from this scheme.
QuestionCPF is my money so why can’t I decide what to do with it?
We are trying to design a system that can cater to the diverse needs of Singaporeans, but would also serve the long-term interests of Singapore and Singaporeans.
一 Lawrence WongPrime Minister
Can my CPF interest rate be higher?
CPF savings are considered long-term savings and hence enjoy interest rates just like regular bank savings. The difference is that CPF interest rates are more stable and carry zero risk compared to market investments.
Interest rates differ for different CPF accounts with rates pegged to different market instruments. Monies in an Ordinary Account may be used frequently throughout the member’s lifetime, similar to bank savings that can be used freely. Its interest rate is therefore based on the 3-month average of major local banks’ interest rates, and is reviewed quarterly, with a current floor rate of 2.5%.
CPF accounts with lower liquidity, namely the Special Account, Retirement Account and MediSave Account, are more like long-term fixed deposits and hence enjoy higher interest rates. Savings in these accounts earn the 12-month average yield of Singapore Government Securities plus 1%, and is reviewed quarterly, with a current floor rate of 4%.
Swipe to the right for more detailsrate
2.5%
Investment, home purchase,
education and insurance
rate
4%
Retirement, investment
rate
4%
Monthly payouts
after member retires
rate
4%
For medical expenses
As of 2023, the CPF Board has 4.49 million members, and assets worth 571 billion dollars. In 2023, Singapore’s nominal GDP was 673.3 billion dollars. This means that the assets managed by the CPF Board are equivalent to nearly one year’s worth of the country’s GDP.
How does such a large sum of savings belonging to all Singaporeans, consistently achieve steady returns and provide stable interest rates for CPF members in the long run?
QuestionHow does the Government provide returns for its CPF members?
The GIC invests the funds in a diversified portfolio of stocks and bonds, where the risk of market fluctuations falls on them.
一 Chris TanProvidend CEO
The CPF Board uses the funds in our CPF accounts to purchase a type of government bond, known as the Special Singapore Government Securities (SSGS).
This SSGS issued by the Government to the CPF Board ensures that members’ funds are safeguarded. The money is “lent” to the Government, which then invests it through the GIC.
The GIC invests the funds in a diversified portfolio of stocks and bonds, and bears the risk of market fluctuations.
QuestionAre my CPF funds managed professionally?
The funds are managed professionally, the interest rates also get reviewed constantly to make sure that it’s within the risk-free environment. Because all the interest, what I talked about, they’re all guaranteed. They are paid out and it is a reasonable level.
一 Tan See LengManpower Minister
The funds are managed professionally, of course. The interest rates also get reviewed constantly to make sure that it’s within the risk-free environment. Because all the interest, what I talked about, they’re all guaranteed. They are paid out and it is a reasonable level.
Four ways to boost your CPF savings
1. Transfer method
Transfer unused savings into the Special Account
The Special Account floor rate is 1.5 percentage points higher than the Ordinary Account. To increase the interest earned, CPF members under 55 years old can transfer their savings which are not intended for housing, education and insurance from theOrdinary Accountinto theSpecial Accountas early as possible.
This allows members to earn a higher interest rate and accumulate more compound interest each year.
Funds transferred into the Special Account and Retirement Account cannot be transferred back to the Ordinary Account, nor can they be used for purposes such as housing or education. Members must ensure there are sufficient usable funds in the Ordinary Account before transferring any additional savings into the Special Account.
As of 2025, the floor interest rate for the Ordinary Account is 2.5%, while the floor interest rate for the Special Account is 4%.
Based on this, if an amount of $10,000 is transferred from the Ordinary Account to the Special Account, after 30 years, the savings could more than double to approximately $11,500, as a result of the higher interest rate.
2. Top-up method
Use cash to top up the CPF account
The CPF Board has introduced several initiatives to encourage members to use cash to top up their CPF accounts to increase savings and enhance retirement security. Members can also benefit from more stable interest rates on their savings. Some of these initiatives include tax relief and dollar-for-dollar matching grants.
Top-up method: Use cash to top up the CPF account
Top up your own or a family member's CPF with cash
Singaporean citizens and permanent residents can use the Retirement Sum Topping-Up Scheme to top up their CPF accounts with cash for themselves or their family members.
Members can receive a dollar-for-dollar tax relief matching the cash top-up amount, excluding amounts that have already been matched under the Matched Retirement Savings Scheme.
- If you top up your own CPF, you can receive a maximum tax relief of $8,000;
- if you top up a family member’s CPF, you can receive an additional $8,000 in tax relief. Together, the maximum tax relief per year can go up to $16,000.
Top-up method: Use cash to top up the CPF account
Utilising the Matched Retirement Savings Scheme
For eligible individuals, the government will provide a one-for-one matching grant for every dollar topped up into their Retirement Account. The top-up can be made by the CPF members themselves or their loved ones.
Currently, the annual matching top-up limit is $2,000, with a lifetime top-up limit of $20,000.
3. Defer method
Defer starting your monthly payout
CPF members can start receiving monthly payout after turning 65 years old. However, if the member still has other sources of income, they can defer starting the monthly payout, allowing their savings to continue accumulating compound interest in their CPF account.
According to data, for each year of deferred withdrawal, the monthly payout amount can increase by up to 7%. Compared to members who start receiving income at 65, those who defer until 70 can see their monthly income increase by up to 35%.
4. Investment method
Use CPF savings for investment
CPF members can invest their Ordinary Account and Special Account savings in a range of instruments through the CPF Investment Scheme (CPFIS), such as unit trusts, investment-linked insurance products, Singapore Government Bonds, and Treasury Bills, in addition to leaving their funds in their CPF accounts.
However, every investment product has its own characteristics and risks, members must fully understand the products before using their CPF savings for investment.
Interested members can click thislinkto learn more about the investment products.
CPF gurus share their tips for maximising savings
Jocelyn Tay
CPF strategy
Saving money is like going to the gym, it needs planning.
- Start transferring savings from the Ordinary Account to the Special Account from the age of 26
- Regularly top up the CPF account with cash
- Avoid using CPF savings as much as possible
Loo Cheng Chuan
CPF strategy
Gradually top up your CPF account, there is no need to scrimp and save for it.
- Top up the Special Account and MediSave Account to the maximum limit, contribute to your children’s CPF account at an early age
- Both husband and wife are committed to saving $500,000 each in their CPF accounts before turning 65, aiming for a total of $1 million. They have already accumulated $1.04 million, 13 years ahead of their plan
Who decides my CPF contribution rate?
For Singapore Citizens and Permanent Resident employees, monthly CPF contributions computed based on their wages are made by both the employer and employee, which go into the member’s Ordinary, Special and MediSave Accounts.
The core objective of the CPF scheme is to ensure that local workers have sufficient retirement funds. Hence, CPF contribution rates are adjusted based on factors such as the member’s saving capacity, retirement expenses and medical needs at different stages of their lives. Monthly contributions made by the employee and employer for each account will also be adjusted to suit the worker’s different needs.
37%
QuestionHow does the Government decide when to adjust the CPF contribution rates?
We have a very pragmatic approach. The key thing about making these changes and as we tweak along is to also constantly engage the ground sentiment with regards to businesses. It has to be sustainable for businesses.
一 Tan See LengManpower Minister
What are the major changes
in CPF contribution rates?Since its founding, Singapore has made several significant adjustments to its CPF contribution rates in response to the overall economic environment at the time, and to enhance our country’s competitiveness.
1986
In 1985, our country experienced its first economic recession since independence. The following year, the total CPF contribution rate decreased for the first time, by 15 percentage points, to help businesses survive in the difficult economic environment.
1999
With the 1997 Asian Financial Crisis, followed by large-scale company closures and retrenchments in the ensuing years, the total CPF contribution rate was slashed by as much as 10 percentage points to help companies tide over difficult times. Employers’ CPF contribution rates were gradually increased after 2000 as the global economy improved.
2003
To enhance the country’s competitiveness in the long run, the government decided that the total CPF contribution rate would not return to its pre-1999 level of 40%, but would instead be maintained between 30% and 36%, with the employee’s rate fixed at 20%.
Looking forward to the future competitive environment, this is no longer advisable. It would price us out of the market. We would lose more jobs.We should give up the target of a 40% CPF contribution rate to save jobs.
一 Goh Chok TongMinisterial Statement by then-Prime Minister,
28 August 2003
2014
In 2015, the employer contribution rate increased to 17%, and together with the 20% contributed by employees, the total contribution rate for employees under the age of 55 has remained at 37% to date.
Which schemes will help increase my CPF account?
Eligible members can receive support through the Workfare Income Supplement scheme.The CPF payment amount is determined by age and income, with a maximum of $4,900 per year. 60% of this payment will be allocated into members CPF account, while the remaining 40% will be provided in cash to assist eligible citizens with their living expenses.
Any other questions?
Let PM Wong and Minister Tan answer them for you.
- Singaporeans are living longer lifespans, CPF savings need to last through their retirement life
- The CPF system seeks to ensure a certain basic retirement sum for retirement
I can appreciate Singaporeans wanting to take their money out of CPF earlier, and they feel that this is their own savings. The challenge is, Singaporeans are living longer lifespans and you need your CPF money to last you for life. If you were to take the money out earlier and spend the money, then how are you going to assure yourself that you will have sufficient savings for your retirement for the next 20, 30, even 40 years?
That's our biggest concern and that's why we have put in place a system where you need to ensure at least a certain basic retirement sum for your retirement savings. Beyond that, yes, you can take out, but please, let's all agree, at least maintain that basic retirement sum for everyone, so that every Singaporean can be assured of some basic level of protection for their retirement.
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