Monday, March 8, 2010

Central Provident Fund (CPF)

What is CPF?
The Central Provident Fund (CPF) is a comprehensive social security savings plan that has provided many working Singaporeans and Permanent Residents (PRs) with a sense of security and confidence in their old age.

What are the scopes and benefits of the CPF?
How much do we contribute to CPF?
From 1 January 2006, the CPF salary ceiling for the workers in the private sector will be further lowered from $5,000 to $4,500. At the same time, CPF employer and employee contribution rates for older workers aged above 50 – 55 will also be reduced from 30% to 27%.The CPF salary ceilings and contribution rates for older workers aged above 50 – 55 in the public sector will be reduced proportionately as well. 

How are our contributions allocated?

Ordinary Account (66.67%) - the savings can be used to buy a home, pay for CPF insurance, investment and education.
Special Account (14.49%) - for old age, contingency purposes and investment in retirement-related financial products.
Medisave Account (18.84%) - the savings can be used for hospitalisation expenses and approved medical insurance.

Interest rates earned by CPF

What is my CPF account number?
For Singapore Citizens or Permanent Residents, your CPF account number is your NRIC number (e.g. S1234567F). For non-Singaporeans, besides the letter ‘S’ or ‘T’, your account number will also have the letter A, B, C, D or F – e.g. SA987654C.

What is the maximum amount I can transfer from Ordinary Account (OA) to Special Account (SA)?
You can transfer any amount, and as often as you like. However, the total savings in your Special Account, inclusive of the amount withdrawn under the CPF Investment Scheme - Special Account (CPFIS-SA), should not exceed the prevailing CPF Minimum Sum after the transfer.

** Take note that transfer is irreversible.

Source: CPF website

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