Your Lifetime Financial Partner

28 Sep 2017 

​By Soh Chin Heng


Mr Soh Chin Heng, or CH as he is commonly called by friends, is the Deputy Chief Executive (Services) of the Central Provident Fund Board Singapore. He oversees the Board’s customer service and schemes administration, and is the Board’s engagement champion. He is a non-practising certified financial planner, and gives regular talks on CPF and financial security.

In my last article, I discussed about the two aspects of your financial security compass that tells you if you are heading in the right direction to achieve your financial goals. The first aspect – your net worth – is the difference between your assets and your liabilities. The second – your cash flow – is the difference between what goes into your pocket each month and what goes out.

In this article, I’d begin to discuss your financial security map, which helps you navigate your way from the starting to the finishing point. Along the way, you would have to traverse various financial terrains. And the first terrain is “The Road”, which stands for work.

When you think of work, what comes to mind? Sadly, many will think of “monday blues” or share that they look forward to saying “T.G.I.F”.

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Work is an important part of our life. For most of us, work is our primary means of livelihood. Work gives us meaning, and a sense of dignity. We ought to be grateful for the work we have. Really.

And with work comes CPF. People lament that it is difficult to save for one’s retirement. I disagree. With CPF, it is easy to save for your retirement! And it is easy simply because it is automatic. You just have to work, and everything else will be done for you. Your company will contribute to your CPF accounts on your behalf, in addition to the employer’s portion paid by your company. The CPF Board will then allocate the contributions into your CPF accounts and you can then use them for various purposes.

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Besides being easy, CPF is a very important part of your financial security. I call it your lifetime financial partner. Let me offer you four reasons:

  1. CPF covers all Singaporeans. That’s almost 4 million of us. As long as you are a Singapore citizen or permanent resident, CPF is relevant to you.
  2. CPF covers you from birth to death.  In the past, one becomes a CPF member only when he first starts work. Today, every Singaporean baby receives a hongbao from the Government  that is credited to his Medisave Account, and he becomes a CPF member from birth. The relationship does not end until he passes on, when the Board will distribute any remaining CPF monies to his beneficiaries. 
  3. At 37%*, the contribution rate is high. Effectively, this means that out of every $3 you earn from work, $1 goes into your CPF. Shouldn’t you be interested in your CPF?
  4. There are many uses of your CPF savings, such as for housing, healthcare, retirement, investment, insurance, education, etc. At every major life stage, CPF has a role in your financial decisions.


Please take some time to get to know your lifetime financial partner. She’s very important to you.

*The CPF contribution rates depends on your age group, wage band and residential status. For an employee aged 55 and below, the employer’s share and employee’s share are 17% and 20% of the salary respectively. For more information on CPF contribution rates, please visit the CPF website


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