CPF Special Account: Ultimate [2023] Guide | Dollar Bureau


CPF Special Account: Your Ultimate Guide

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cpf special account

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Managed by the Central Provident Fund Board (CPFB) of Singapore, the CPF is a key aspect of Singaporean and permanent residents’ retirement plans.

The CPF is funded by both you and your employer, with the purpose that the contributions will go to your future retirement needs.

All contributions made to the CPF go into either of 3 accounts: the Ordinary Account (OA), Special Account (SA), and the MediSave Account. Each account has its own role to play.

However, what is the CPF SA account?

What can I do with this account?

You’ve come to the right place.

In this post, we talk more about the CPF Special Account and what you need to know.

What is CPF Special Account?

As for the CPF SA, it’s a retirement account where withdrawals cannot be made until Singaporeans reach the retirement age.

Contributions to the CPF SA depend on your age, with the lowest being 1.0% of your pay, to the highest being 11.5% of your pay allocated towards the account.

All contributions earn risk-free interest.

CPF Special Account Interest Rate

The CPF Special Account pays an interest rate of 4% p.a. and can go up to 6% p.a. on certain conditions.

And this makes it one of the most attractive aspects of the CPF SA as it allows you to earn a guaranteed interest rate each year. The CPF SA’s interest rate is higher than that of the OA.

Every quarter, the interest rate is reviewed by the government and is subject to change.

For those below 55, you can earn up to 5% per annum on the first $60,000 of your combined CPF account balances (the cap for OA is $20,000).

For those over 55, you can earn up to 6% per annum on the first $30,000 of your combined CPF balances (the cap for OA is $20,000), and then up to 5% per annum on the next $30,000 (the cap for OA is also $20,000).

Note that the current floor interest rate on the CPF SA is 4% per annum for both age groups.

Compound interest also allows your CPF SA to grow at a faster rate. If you’re under 55 and working, every dollar contribution you make towards your SA is matched at $0.85 by your employer, which gives you a total of $1.85 contributed.

This amount will accrue an exponentially higher amount of interest than the original $1 you would have contributed on your own.

Assuming you have $10,000 in your SA account now and it compounds at the 4% guaranteed interest for 20 years.

Period CPF SA Account Interest Rate (4%)

No Additional Contributions

Year 0 $10,000
Year 10 $14,802.44
Year 20 $21,911.23

As you can see, assuming you don’t even work at all and stop contributing to your CPF accounts totally, in 20 years, your capital more than doubles at the risk-free rate.

What are the features of CPF SA?

A few key features of the CPF SA are as follows:

  • It provides a guaranteed reliable return and a regular income for retirement
  • The CPF SA’s interest rate is adjusted by the government based on inflation
  • CPF Special Account savings are untouchable before the age of retirement, there is no way to withdraw the funds once the cash has been transferred
  • You can top up your CPF SA voluntarily or by transferring OA funds to SA (to be discussed later)
  • You can use your CPF SA for investing instead of saving, but need a balance of at least $40,000. The investments need to be approved and are usually low to medium risks such as government bonds and annuities.


What can I use CPF SA for?

The CPF SA is used for retirement savings and investing activities.

Firstly, we talk about retirement savings.

At 55, the SA and OA are combined to form the retirement account (RA), which will be used for the CPF Life or CPF Retirement Scheme.

CPF Life offers three tiers to choose from once you retire, that offer lifelong payouts each month to members.

The options vary based on how much retirement income you’re aiming for and if you meet the minimum required amount in your CPF.

For Singaporeans born after 1957, they are automatically part of the CPF Retirement Scheme – CPF Life which is the improved version of the CPF Retirement Scheme. Those not automatically enrolled can opt-in.

The above is what you’ll receive as retirement savings in your golden years.

Looking to maximise your retirement account?

We share CPF hacks & tips in this post.

Next, investing.

Given that CPF funds are only available to you at 55 (and payouts start even later), the CPF Retirement Scheme and/or CPF Life allows you to invest your Special Account and Ordinary Account savings in various investments to maximise your retirement savings.

Before 55, you have the option to invest your CPF SA funds in the CPF Investment Scheme -SA (with risk included) to try and grow your money at a faster rate than the SA interest rate mentioned above.

However, investing your SA funds in attempts to beat the 4% risk-free rate is challenging, and many Singaporeans fail to beat it.

In fact, 52.6% of Singaporeans in 2015-2019 who tried to invest their OA funds to beat the (2.5% interest rate), failed.

And it’s going to be much harder to beat the 4% SA.

Read more about CPF Investments here.

Note that for the CPF Investment Scheme – Special Account, you can only begin to invest your savings after reaching the minimum amount of $40,000 in your SA.

How to top up my CPF SA account?

There are 2 main ways of topping up your CPF SA account to build your savings. The first most straightforward way is to top up with cash.

Cash Top Ups

These voluntary cash contributions can be made at any time whether when you have spare cash lying around or if you want to contribute a lump-sum amount from your annual bonuses or cash gifts.

Cash top-ups allow you to earn interest even if you’re not working, or don’t have periodic CPF contributions.

Note that there is a CPF top-up limit calculated by taking the difference between the CPF Annual Limit of $37,740 and the mandatory annual CPF contributions.

It’s important to consider this before making top-ups since any amount over the limit will be refunded without accrued interest.

Transferring from CPFOA to CPFSA

The second way to top up your CPF SA is to transfer money from your CPF OA into your SA.

This needs to be done before you reach 55 as both accounts then merge into your Retirement Account (RA).

The reason you may want to use this method is that Ordinary Account Interest (2.5%) is lower than that of the Special Account (4%), so you can have more money for retirement by transferring funds.

An estimated 1.5% interest rate difference between the OA and SA rate can mean thousands of extra dollars earned had you not made the account transfer!

Using the same scenario above, let’s illustrate the differences.

Period CPF SA Account Interest Rate (4%) CPF OA Account Interest Rate (2.5%) Difference
Year 0 $10,000 $10,000
Year 10 $14,802.44 $12,800.85 $2,001.59
Year 20 $21,911.23 $16,386.16 $5,525.07

As you can see, transferring your monies from OA to SA earns you a difference of $5,525.07 or 33.72% more than leaving it in the Ordinary Account.

If you want to calculate the difference between the amount earned from leaving your funds in your OA compared to transferring them to your SA, use this CPF calculator.

The benefits of topping up by transferring from your OA to SA include:

  • Higher interest rate and more money earnt for retirement
  • The SA interest rate beats inflation (the average inflation rate in Singapore has historically been below 2.0%)
  • You can enjoy a guaranteed return that’s not tied to how good or bad Singapore is doing. This is the safest investment available for Singaporeans as the earnings are guaranteed regardless of the stock market’s status
  • CPF is inaccessible to creditors in the case of bankruptcy. This is another reason adding to CPF SA’s safety blanket quality
  • CPF SA can be used to invest in any approved investments under the CPF Investment Scheme after reaching the minimum amount of $40,000. Any profits go back to your SA where you can withdraw once you turn 55
  • You can do this to shield your CPF monies


Although transferring from OA to SA seems rosy, there are some points to be aware of before you take any action:

  • Any transfer made from your OA to SA is permanent and irreversible. Make sure you have a cash emergency fund because you will not be able to access any of the money you had previously transferred
  • Because any funds transferred to SA are locked, this means you can’t use the money for a house down payment, so instead you’ll need to save some cash on hand if you’re planning on buying a house. This is an issue for those many Singaporeans that pay their mortgages from their Ordinary Account
  • You will need to rely on banks for any student loans, as the funds in your SA can’t be used to fund any education needs. This means you’ll need to save cash in advance or get a bank loan
  • Although the earnings are guaranteed, the interest rates are not. Beware that interest rates are currently high, but this can easily change in the span of 20-30 years
  • There is no tax relief from transferring money from your OA to SA, unless you top up with cash


Pros of CPF SA

Now you may be wondering if it’s worth contributing more to your Special Account, and rightfully so.

In addition to the advantages of transferring funds from your Ordinary account to your Special Account discussed above, here are some core benefits of making more SA contributions:

  • Returns are stable and guaranteed, unlike volatile stock market investments. This is good if you have a low-risk tolerance and if you prefer certainty
  • CPF Special Account rate beats inflation and loads of other investment options
  • If you go bankrupt, your money in your CPF SA is safe and shielded from creditors


Cons of CPF SA

Keep in mind that there are some disadvantages when it comes to making voluntary contributions or transfers to your Special Account, including:

  • You cannot withdraw for any other purposes until you reach the age of 55. Even in the case of an emergency, there is no way to access funds, unlike your SRS account which allows you to do so with a penalty charge.
  • Not only are transfers from your Ordinary Account to your Special Account non-reversible, but the same restriction applies to cash top-ups which are also permanent contributions that cannot be withdrawn



The CPF SA offers many benefits, most notably the nearly risk-free nature of the account, the guaranteed returns, and the higher interest rate.

It is a fantastic option considering the alternative volatile investments offered by the stock market.

Despite the disadvantages, the most inconvenient one being the inability to withdraw funds, the CPF Special Account remains a safe choice for those looking at their long-term retirement plans.

At the end of the day, you can decide how much to contribute to your CPF SA based on your personal circumstances, risk tolerance, and your disposable income.

That being said, most people are better off making smaller and more consistent contributions rather than throwing all of their life savings toward their Special Account.

To get a professional opinion on how to strategise your contributions, click here to get connected to a financial advisor today (for free)!

Disclaimer: Each article written obtained its information from reliable sources and should be purely used for informational purposes only. The information provided by Dollar Bureau and its affiliated parties is not meant to be construed as financial advice. Dollar Bureau shall not be held liable for any inaccuracies, mistakes, omissions, and losses incurred should you act upon any information listed on this website. We recommend readers to seek financial planning advice from qualified financial advisors. 

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