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Central Provident Fund (CPF)
Central Provident Fund (CPF)
The CPF is a compulsory savings scheme operated by the Singapore Government to ensure that every Singaporean and Permanent Resident of Singapore has enough funds set aside for healthcare, housing and retirement.
The CPF is a compulsory savings scheme operated by the Singapore Government to ensure that every Singaporean and Permanent Resident of Singapore has enough funds set aside for healthcare, housing and retirement.
CPF Contribution
CPF Contribution
Every month, 20% of your income will be deducted to contribute to your CPF Accounts. Additionally, your employer will also top up an extra 17% of your income into your CPF Accounts.
Every month, 20% of your income will be deducted to contribute to your CPF Accounts. Additionally, your employer will also top up an extra 17% of your income into your CPF Accounts.
Eg. If your salary is $2000 per month, you will contribute $400 every month and take home $1600. However, your CPF account will grow by $740. $400 from your income + $340 from your employer.
Eg. If your salary is $2000 per month, you will contribute $400 every month and take home $1600. However, your CPF account will grow by $740. $400 from your income + $340 from your employer.
*These contribution rates are valid until 55 years old.
CPF Savings
CPF Savings
Your CPF contributions is saved in 3 accounts. The Ordinary Account (OA) is used for housing, education and investments. The Special Account (SA) is used to invest for retirement. Lastly the Medisave Account is used for healthcare payments.
Your CPF contributions is saved in 3 accounts. The Ordinary Account (OA) is used for housing, education and investments. The Special Account (SA) is used to invest for retirement. Lastly the Medisave Account is used for healthcare payments.
Benefits
Benefits
By pooling the compulsory savings of all Singaporeans together, the government is able to invest the money through the Monetary Authority of Singapore (MAS)'s management of foreign reserves and Government of Singapore Investment Corporation (GIC)'s management of financial investments. These investments have led to a guaranteed interest rate of 2.5 to 5% for all CPF Savings.
By pooling the compulsory savings of all Singaporeans together, the government is able to invest the money through the Monetary Authority of Singapore (MAS)'s management of foreign reserves and Government of Singapore Investment Corporation (GIC)'s management of financial investments. These investments have led to a guaranteed interest rate of 2.5 to 5% for all CPF Savings.
Compounding Effect of CPF Interest
Compounding Effect of CPF Interest
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