The Central Provident Fund (CPF) Board has announced several major updates set to take effect in 2025. These changes aim to enhance Singaporeans’ financial security across three essential areas: retirement, housing, and healthcare.
From January 2025, CPF members can expect higher retirement savings, increased financial aid for seniors, and new contribution rules for platform workers. These updates are part of Singapore’s broader efforts to keep the CPF system relevant and adaptable to economic changes.
Let’s break down the eight key CPF changes that will impact your financial planning in 2025.
1. What Happens to the Special Account (SA) for CPF Members Aged 55 and Above?
Starting in the second half of January 2025, CPF members aged 55 and above will see their Special Account (SA) closed.
- SA savings will be transferred to either the Retirement Account (RA) or the Ordinary Account (OA) depending on the member’s Full Retirement Sum (FRS).
- Members with ongoing CPF Investment Scheme (CPFIS) investments under SA can continue holding them. However, any proceeds from these investments will be transferred to their Retirement Account (RA).
2. How Much Will the Enhanced Retirement Sum (ERS) Increase in 2025?
From January 1, 2025, the Enhanced Retirement Sum (ERS) will increase to four times the Basic Retirement Sum (BRS).
- New ERS: S$426,000 (up from S$308,700 in 2024).
- This will allow CPF members to set aside more savings in their Retirement Account and receive higher monthly payouts during retirement.
3. What Are the Updates to the Matched Retirement Savings Scheme (MRSS)?
The Matched Retirement Savings Scheme (MRSS) will undergo three key changes in 2025:
- The matching grant cap will increase from S$600 to S$2,000 per year.
- The age cap of 70 will be removed, making around 800,000 CPF members aged 55 and above eligible.
- Tax relief for cash top-ups that attract the matching grant will no longer be available, but top-ups not qualifying for the grant will still be eligible for tax relief.
4. How Much More Will Seniors Receive Under the Silver Support Scheme?
The Silver Support Scheme, which provides financial assistance to low-income elderly Singaporeans, will see a 20% increase in quarterly payouts from January 1, 2025.
- The qualifying household monthly income per person threshold will increase from S$1,800 to S$2,300.
- Payments will remain tiered based on HDB flat type and household income.
5. What Changes Are Being Made to the Workfare Income Supplement (WIS)?
To better support lower-income workers, the Workfare Income Supplement (WIS) will have an increased income cap and higher payouts in 2025:
- Qualifying income cap: Raised from S$2,500 to S$3,000 per month.
- Maximum annual payout: S$4,900 (up from S$4,200).
- This change is expected to benefit around 500,000 lower-income workers.
6. How Will CPF Contributions Change for Platform Workers?
For the first time, CPF contributions will be deducted from platform workers’ earnings starting January 1, 2025.
- Platform workers born on or after January 1, 1995 will see gradual CPF contribution increases until it reaches 20% by 2029.
- Platform operators must match contributions up to 17%.
- Workers born before 1995 can opt in for the CPF contributions or continue contributing only to their MediSave Account.
7. Will There Be Any Additional CPF Interest Rate Changes?
While no official interest rate changes have been announced yet, CPF savings interest rates are expected to remain stable in early 2025.
- The CPF Board regularly reviews and adjusts interest rates based on economic conditions and market trends.
- Any new updates on CPF interest rates will be released in mid-2025.
8. What Are the Long-Term Goals of These CPF Changes?
The CPF Board has stated that these updates aim to enhance Singaporeans’ financial well-being by:
- Helping members increase their retirement savings.
- Providing more financial support for seniors.
- Ensuring CPF remains a reliable social security pillar.
Singapore’s government is committed to adjusting CPF policies to keep up with inflation and economic trends while ensuring affordability and sustainability.
READ MORE: How US Fed Interest Rates Influence Singapore Mortgage Rates in 2025 – What Homeowners Must Know
Frequently Asked Questions
What happens if my CPF Special Account (SA) is closed?
Your SA savings will be transferred to either your Retirement Account (RA) or Ordinary Account (OA), depending on how much you’ve saved.
Can I contribute beyond the new Enhanced Retirement Sum (ERS)?
No, CPF members cannot exceed the new ERS limit of S$426,000 in their Retirement Account.
Who benefits most from the increased Workfare payouts?
Lower-income workers earning up to S$3,000 per month will benefit from higher Workfare payouts, with up to S$4,900 per year.
How will CPF contributions affect platform workers?
Platform workers born after January 1, 1995 will gradually contribute more CPF (up to 20% by 2029). Employers will also match contributions up to 17%.
Can CPF members aged 55 and above still use their savings for investments?
Yes, members can retain their existing CPF Investment Scheme (CPFIS) investments. However, proceeds will go to their Retirement Account.
When will the Silver Support Scheme payouts increase?
From January 1, 2025, Silver Support Scheme payouts will increase by 20%.
Where can I check my CPF contribution details?
CPF members can check their updated contributions and account balances via the CPF website or CPF Mobile App.
Click here to know more.
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