July 13, 2021

Categories: Finance - Savings

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The Central Provident Fund or more commonly known as CPF – most of us contribute to it on a mandatory basis – but have you ever wondered how much the “average” CPF balance for each age group is, and where do you stand amongst them?

In the 2020 annual report released by CPF1, some interesting findings were uncovered which piqued my interest. It was found that 15.4% of individuals between 35 to 40 years old have CPF balances between $300,000 to $400,000, and another 7.61% having between $400,000 to $500,0002. By most standards, this would be quite a considerable amount that indicates good progression towards a comfortable retirement nest egg.

But as I would like to emphasise again, retirement expectations differ from individual to individual, and the factor of inflation and rising medical costs must always be carefully planned for. In essence, it is always a wise idea to explore ways of increasing your CPF savings. There are a few ways to do so, which you may consider in line with your personal financial needs and situation.

  • Top up your Special Account to cater for long-term retirement needs
  • Transfer from your Ordinary Account to Special Account to earn 1.5% more interest p.a.
  • For home buyers with good cash flow, consider keeping $20,000 in your Ordinary Account
  • Invest using the CPF Investment Scheme to grow your funds

Of course, most important to note is that some of these options are irreversible and hence, require a holistic approach to the big picture. If you need some help to find balance between achieving your current priorities and reaching your future ambitions, I will be happy to share more about how CPF can be a pivotal part.

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