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CPF in plain words

9 October 2026 · 5 min read

For most people working in Singapore, the Central Provident Fund is the largest saving they hold, often larger than anything in a bank. It is also one of the least understood. This article explains, in plain words, the accounts, the interest, the change at 55 and CPF LIFE, with a link to the CPF Board’s own page for each, because the details are set by the Board and change from time to time.

What CPF is

CPF is a compulsory savings scheme for Singapore Citizens and Permanent Residents who work. Each month, part of the salary is paid in by the employee and part by the employer. The share depends on age, and it applies to monthly wages up to a ceiling, currently S$8,000 (CPF Board, read 3 October 2026) a month for ordinary wages. The CPF Board publishes the contribution rates for each age band; they fall in steps after 55.

The accounts, and what each is for

What goes in is split between accounts, again by age. Before 55 there are three:

  • The Ordinary Account. Many members use it to buy a home or pay a housing loan; it can also be used for some other approved purposes.
  • The Special Account, for retirement. Savings here are meant to stay until later in life.
  • The MediSave Account, for medical costs, especially after retirement, and for premiums of approved health insurance such as MediShield Life.

The younger the member, the more of each contribution goes to the Ordinary Account; as the member gets older, more goes to the Special and MediSave Accounts. The exact shares are in the Board’s allocation tables.

How interest is paid

Each account earns interest at a rate the Board sets for each quarter. For the quarter to the end of December 2026, the Ordinary Account earns 2.5% (CPF Board, read 3 October 2026) a year, which the Board calls the legislated minimum for that account. The Special Account earns 4% (CPF Board, read 3 October 2026) a year and the MediSave Account 4% (CPF Board, read 3 October 2026) a year.

On top of that, the Board pays extra interest on the first part of a member’s combined balances, and more again for members from 55. The thresholds and the extra rates are on the Board’s interest page. Interest is worked out monthly and added to the accounts once a year.

What changes at 55

At 55, a Retirement Account is created. In the CPF Board’s words, “at age 55, a Retirement Account (RA) is created for you and your Special Account is closed.” Savings from the Special Account, and from the Ordinary Account if needed, go into the Retirement Account up to a set amount. The closing of the Special Account at 55 is recent: it took effect in January 2025, so older guides may still describe the Special Account carrying on after 55.

The set amount is one of three retirement sums: the Basic, the Full and the Enhanced Retirement Sum. Each is fixed for the year in which a member turns 55, and the Board raises them for later years. They are a way of saying how much is set aside for a monthly payout later: the more in the Retirement Account, the higher the payout. Savings above the sum that applies can, in general, be withdrawn from 55. The amounts for each year, and the conditions, such as when a property can be counted, are on the CPF Board’s overview and the pages it links to. This article gives no amounts, because they change each year.

CPF LIFE

CPF LIFE is how the Retirement Account becomes an income. The Board describes it as “a national longevity insurance annuity scheme that provides you with monthly payouts no matter how long you live.” Payouts can start from 65, the payout eligibility age, and can be started later, up to 70, for a higher amount each month. There is more than one CPF LIFE plan, and they differ in how the payout is shaped over the years. The plans, and an estimate of the payout from a member’s own savings, are on the CPF LIFE page.

The point of a lifelong payout is that it does not run out. Savings drawn by hand can; a monthly income for life cannot, however long its owner lives. That is why the size of the Retirement Account at 55 matters so much to retirement income in Singapore.

What FinWise365 models, and what it leaves out

In FinWise365, CPF is an item that can be added from Money or in one tap from Plan. It holds the three accounts with their own balances, the monthly amounts going in (from the person’s own figures or from an estimate labelled as one), the interest rates from the rule book above, and an age from which Ordinary and Special Account savings count as money the plan can draw on, 65 unless changed. Contributions stop when the person stops work, or in a month the person chooses, such as a move abroad. A home loan can be paid from the Ordinary Account.

Some things are not modelled today, and the app says so: the Retirement Account at 55, the retirement sums, CPF LIFE payouts and the extra interest. The plan keeps the Special Account after 55, so for anyone near or past 55 its CPF picture is simpler than the real one. Fuller CPF rules and CPF LIFE are on the list of what is coming. Until then, the CPF Board’s own planners give the CPF LIFE estimate, and FinWise365 shows the rest of the household’s money around it.

See your own numbers first, then decide whether you want an adviser.

Start, no sign-up or see an example plan

Illustration, not advice. Written 9 October 2026; checked 9 October 2026.

Sources

  1. CPF overview, CPF Board, read 9 October 2026.
  2. CPF LIFE, CPF Board, read 9 October 2026.
  3. Earning attractive interest, CPF Board, read 3 October 2026.
  4. CPF contribution rates from 1 January 2026, CPF Board, read 3 October 2026.
  5. It’s easier with CPF (retirement planning), CPF Board, read 9 October 2026.