Explain how one contribution is split across your accounts and why the split changes as you get older.
CPF money comes out of your pay every month, but most people only check the balance about once a year, if they check it at all. The balance tells you how much you have saved. It doesn't tell you how that money was divided when it came in, and the division is what limits how you can spend it later. Each contribution is shared out across three separate accounts as soon as it reaches CPF. From then on, each portion can only be used for what its account allows.
The deduction works like this. Before your salary is paid, part of it is taken for CPF, and your employer pays an additional amount on top. Together these make up your monthly contribution. Both parts are worked out as a percentage of your wages, and the employee rate and the employer rate both change as you get older.
The percentage is only applied up to a cap. The Ordinary Wage ceiling is the highest monthly salary used to work out contributions. If you earn above it, your contribution doesn't go up, however much more you earn. Bonuses are handled separately and are measured against a yearly cap called the Additional Wage ceiling. The government has increased the Ordinary Wage ceiling in stages over recent years. Before you work out any contribution, check this year's figure on the CPF Board website.
Until you turn 55, your contributions go into three accounts. The Ordinary Account (OA) can be used to buy a home, pay for approved education and make some investments. The Special Account (SA) holds money for retirement. It pays more interest than the OA because the money stays in it for longer. The MediSave Account (MA) pays for healthcare: hospital bills, MediShield Life premiums, other approved insurance premiums and some outpatient treatment.
Your age decides how much each account receives. Early in your working life, the OA gets the biggest portion, because those are the years when most people buy a home. As you get older, the OA gets less and more goes to the SA and MediSave. The scheme moves your money away from housing and towards retirement and healthcare as those needs get nearer. The share each account gets is called the allocation rates, and the CPF Board publishes them for each age band. They are revised from time to time. Always use the table currently on the CPF Board website, and don't rely on a number you've seen in an article or heard from someone else.
You can't move money freely between the accounts. Money in your SA can't be moved back to your OA to help pay for a flat. Money in MediSave can't be used for rent. Once a contribution has been assigned to an account, what you can use it for is mostly fixed. There is one main exception, and it only works in one direction. You can move OA money into your SA to earn the higher interest rate, but you can never move it back. Module 3 explains when that transfer is worth making.
Things change when you turn 55. CPF opens a Retirement Account for you. Savings from your SA and OA are moved into it, up to an amount set for people born in your cohort. Since 2025, the SA is closed at 55. Whatever is left in it goes into the Retirement Account, and anything above the retirement sum goes into your OA. Module 6 explains all of this in detail. Until you turn 55, you are saving into the three accounts described above.
Your plans depend on this split. Say you hope to buy a flat in five years. The OA portion of each monthly contribution decides how much CPF money you will have for the downpayment and the monthly instalments. For retirement, the SA portion decides how quickly your savings there grow. If you top up your CPF, you need to know which account receives the money and what it can be used for after that. Every projection you make later in the course, whether for housing, retirement or top-ups, starts from this split.
You don't need to learn the allocation table by heart. You need to know where to find it and how to read it, and comparing it with your own statement is a good way to practise both.
Log in to the CPF website with Singpass, open your statement, and look at last month's contribution. Note how much went to each account. Then find the allocation table for your age band on the CPF Board website and check that the split on your statement matches it.
Open your CPF statement, find last month's contribution and write down how much went to each account. Then compare it with the CPF Board allocation table for your age.
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