“When I turn 55 years old, I can no longer use my Ordinary Account savings for my housing loan repayments.”

False. When you turn 55 years old, some of your Ordinary Account (OA) savings may be transferred to your newly created Retirement Account (RA) to form your retirement sum. However, you do have a choice to reserve savings in your OA and continue to use it for your housing loan repayments. Read on to find out more about using CPF savings to pay for your housing loan after 55 years old.


What happens to your CPF savings at 55 years old

A common misconception is that all your CPF savings, including that in the OA, will be transferred to the RA when you turn 55 years old, thus leaving you with nothing for your housing loan repayments. But in fact, only monies up to the Full Retirement Sum applicable to you will be transferred to the RA. Your Full Retirement Sum is fixed when you turn 55 years old and does not change thereafter. Plus, transfers are first taken from the Special Account (SA) before the OA. Balances left in your OA can still be withdrawn to meet your housing loan repayments. Also, if you continue working after 55 years old, you will still get your CPF contributions in your respective OA, SA and MediSave Account (MA).

Learn from the best

If you are concerned about your housing needs in the case where all your OA savings are transferred to the RA, don’t worry! There are 3 ways to continue tapping on your CPF savings for your housing needs.

1. Inform CPF Board before you turn 55 years old to reserve all or part of your OA savings to continue meeting your housing loan repayments or to pay for your new home. These OA savings will not be transferred to your RA.

2. Apply to use your RA savings* above your Basic Retirement Sum to fund your housing needs, including HDB upgrading cost payments.

3. If you are still working after 55 years old, you can also continue using your future CPF OA contributions for your housing loan repayments.

These options can help you continue servicing your housing loan after you turn 55 years old. On the flipside, do note that the reduction in your RA balances will reduce your CPF monthly payouts when you reach your payout eligibility age. Therefore, it’s best to consider the opportunity cost and weigh this option against using your cash savings.

* This excludes any interest earned, government grants received, and top-ups made under the Retirement Sum Topping-up Scheme.


When should you consider using cash to repay your housing loan

After using your CPF savings to service your housing loans for years, there might be an instinctive reluctance to use cash. However, by using your CPF, you’ll miss out on growing your retirement funds with attractive interest rates#. Here’s how you can benefit from repaying your housing loan with either CPF or cash:

Learn from the best

So if you have spare cash on hand, why not consider using cash, or a combination of cash and CPF as an option to pay off your housing loans? After all, having the luxury to stop working when you wish to retire is just as important as having a roof over your head now.

# You earn a base interest of 2.5% p.a. on your Ordinary Account (OA), and 4% p.a. on your Special Account (SA). An extra interest of 1% p.a. is paid on the first $60,000 of your combined CPF balances, with a cap of $20,000 from your OA. Hence, you enjoy up to 3.5% p.a. on your OA and up to 5% p.a. on your SA. At age 55 years old, a Retirement Account (RA) is automatically created using savings from your SA and OA. From here on, an additional extra interest of 1% p.a. is paid on the first $30,000 of your combined CPF balances, with a cap of $20,000 from your OA. Hence, you enjoy up to 6% p.a. on your RA.


For more information on what happens to your CPF at 55 years old, visit our page about withdrawals of CPF savings from 55 years old.

For your convenience, you can perform these transactions online after logging into mycpf using your SingPass. Refer to these online demos on how to reserve your OA monies or transfer monies from your RA to OA for housing.