🕊️ Financial PlanningCPF and CPF LIFE: how your retirement payout works
The Central Provident Fund (CPF) is Singapore's compulsory savings system, covering retirement, housing and healthcare in one. While you work, a large slice of your pay goes into CPF and is split across three accounts. At 55 a Retirement Account is created; from age 65 CPF LIFE turns that balance into a monthly payout for life. This guide covers the contribution rates, the Ordinary/Special/MediSave split, the retirement sums, and how much CPF LIFE pays.
Contributions and the three accounts
For an employee aged 55 or under, CPF is 20% from you and 17% from your employer — 37% of your wage — on the part of your wage up to the Ordinary Wage ceiling (S$8,000 a month from 2026). The rates step down after 55. The money is split across the Ordinary Account (OA, for housing, some investments and education), the Special Account (SA, for retirement), and MediSave (MA, for healthcare and MediShield Life premiums).
The OA earns 2.5% a year; the SA, MA and Retirement Account earn around 4%, with an extra 1–2% on the first tiers of your combined balances. That guaranteed return, and the fact you cannot spend it early, is what makes CPF a strong retirement base.
The retirement sums and CPF LIFE
At 55, your SA closes and its money, plus OA money up to the Full Retirement Sum, moves into a new Retirement Account (RA). The benchmarks are the Basic Retirement Sum (you can meet this if you own a home), the Full Retirement Sum (twice the BRS), and the Enhanced Retirement Sum (four times the BRS since 2025, the maximum you can top up to). A higher sum in the RA means a higher payout.
From the payout eligibility age of 65, CPF LIFE pays you a monthly income for life — you cannot outlive it, even if the RA balance runs out. As a rough guide, the Full Retirement Sum produces around S$1,600 a month, the Basic Retirement Sum about half that, and the Enhanced Retirement Sum roughly double. You can defer the start up to 70, adding about 7% for each year deferred.
Why you still need savings on top
CPF LIFE is designed to cover basic retirement needs, not a full lifestyle. The layers on top are the Supplementary Retirement Scheme (SRS), which gives an income-tax deduction on contributions; voluntary CPF top-ups (also tax-relieved); low-cost global index funds and REITs; Singapore Savings Bonds; and, for many, an investment property.
Check your CPF balances and projected payout in the CPF app or the online retirement calculators. Topping up to the Full or Enhanced Retirement Sum, or deferring CPF LIFE past 65, are the two biggest levers on the eventual payout.
Frequently Asked Questions
- What age does CPF LIFE start paying?
- The payout eligibility age is 65. You can defer the start up to age 70, and each year of deferral raises the monthly payout by roughly 7%. The payout continues for life, even if your Retirement Account is drawn down to zero.
- How much CPF is deducted from my pay?
- For an employee aged 55 or under, 20% from you and 17% from your employer — 37% — on wages up to the Ordinary Wage ceiling (S$8,000 a month from 2026). The rates step down at older ages. It is split across the Ordinary, Special and MediSave accounts.
- How much does CPF LIFE pay each month?
- It depends on your Retirement Account balance at 65 and the plan you choose. Roughly: the Full Retirement Sum gives about S$1,600 a month, the Basic Retirement Sum around half that, and the Enhanced Retirement Sum roughly double. Deferring past 65 increases it further.
Informational content, not financial, tax or legal advice. Check amounts, limits and current rules directly with the official sources (CPF, the Monetary Authority of Singapore, IRAS, and the SDIC) before making a decision.
