CPF Board closes 1.4 million Special Accounts of members on Jan 19
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Following the closure, members will have an Ordinary Account (OA) and a Retirement Account (RA).
PHOTO: ST FILE
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SINGAPORE - About 1.4 million Central Provident Fund members who are aged 55 and above as of Jan 19 will not have a Special Account (SA)
Following the SA closure, they will have an Ordinary Account (OA), a MediSave Account and a Retirement Account (RA), which was created for them on their 55th birthday.
The savings in their SA have been transferred into their RA up to the cohort’s Full Retirement Sum (FRS), which is two times the Basic Retirement Sum (BRS), or $213,000 in 2025, said the CPF Board in a statement on Jan 19.
These savings will continue to earn the long-term interest rate of at least 4 per cent per annum from Jan 1 to March 31. The interest rates are reviewed quarterly and the Government has committed to pay at least 4 per cent
Any remaining savings in the SA have been transferred to the OA, where they will earn 2.5 per cent interest a year.
The CPF Board said members who would like to continue earning the higher interest rate of 4 per cent a year can choose to move some of these OA savings into their RA up to the current year’s Enhanced Retirement Sum (ERS), which is $426,000 in 2025.
The ERS, which is the maximum amount these members can commit towards CPF Life retirement payouts, was raised from three times to four times the BRS in January.
The transfer can be made any time, but the CPF Board noted that if members wish to earn the higher interest from January onwards, the transfer must be processed by Jan 31, 2025.
As the ERS increases every January, members can also make further top-ups every year to boost their retirement payouts. The ERS is $440,800 for 2026, and $456,400 for 2027.
Any transfer of savings from the OA to the RA cannot be reversed, it said. These savings will be reserved to boost retirement payouts and cannot be taken out for other purposes, such as for investment and emergency needs.
If CPF members wish to retain the flexibility of being able to withdraw their money at any time, they can choose to leave the excess SA savings in their OA, where they will earn 2.5 per cent interest a year.
It is worth noting that members aged 55 and above earn an extra interest of 2 per cent a year on the first $30,000, and 1 per cent a year on the next $30,000 of their combined CPF balances, capped at $20,000 for the OA.
If the CPF member is still working, any CPF contributions allocated to the SA currently will also go into the RA, up to the cohort’s FRS. The remaining contributions will be channelled to the OA.
Similarly, those who used their SA to make investments under the CPF Investment Scheme can continue to hold their investments until they sell them or until they mature. Upon sale or maturity, the proceeds will go to the RA up to the FRS, and any remaining balance will go to the OA.
Responding to The Straits Times’ queries, the CPF Board said only less than 1 per cent of the roughly 1.4 million CPF members who are 55 and above on Jan 19 will not be able to transfer all the savings in their SA that were channelled to the OA, due to the closure of SA, to the RA. This is because the savings in their SA and RA are already cumulatively more than the raised ERS.
The move to close the SA of members aged 55 and above was announced during Budget 2024.
It was debated extensively earlier in 2024, and changes to the CPF Act were passed in Parliament in October 2024 to legislate the SA closure.
During the debate on the changes to the CPF Act, Manpower Minister Tan See Leng had said that the principle behind closing the SA is to “right-site” CPF monies so that only CPF savings committed towards long-term retirement needs should earn the higher long-term interest rate.
From Jan 20, 2025, the CPF Board said members will be notified through a letter, e-mail or SMS on the closure of their SA.
They can also view the amounts transferred to their RA or OA, or both, by logging on to the CPF website or smartphone app, it added.
The CPF Board advised members to be extra vigilant against scammers who may pretend to be CPF Board staff, government officials, bank or insurance agents, or claim to be appointed by the Board.
It noted that their tactics include asking for personal details, under the guise of advising on CPF or CPF-related insurance schemes or offering ways to earn higher returns through investments.
