1B.6 CPF Investment Scheme (CPFIS)
Using CPF savings to invest. The examination tests the OA/SA distinction, the investment account, the thresholds and limits, and what happens at 55, on bankruptcy and on death.
6.1 Structure
Section titled “6.1 Structure”CPFIS-OA uses Ordinary Account money and requires a CPF Investment Account. CPFIS-SA uses Special Account money and does not require that investment account.
6.2 History
Section titled “6.2 History”CPFIS began with OA investing in 1987 and expanded to SA in 2001.
6.3 Investment account
Section titled “6.3 Investment account”An agent bank — DBS, OCBC or UOB — holds the CPFIS-OA investment account for settlement and holdings; a member may have only one.
6.4 Eligibility
Section titled “6.4 Eligibility”Age 18 or older, not an undischarged bankrupt, and exceeding the OA/SA thresholds. Only OA money above S$20,000 and SA money above S$40,000 is generally investible, so the first S$60,000 earns additional interest; permitted regular-premium insurance and agent-bank fees are treated separately.
6.5 Application process
Section titled “6.5 Application process”New investors must complete the Self-Awareness Questionnaire (SAQ). Bring identity documents, SAQ status and CPF statement. Inform the dealer of account details before trading.
6.6 Short-term sale of a qualifying purchase
Section titled “6.6 Short-term sale of a qualifying purchase”A qualifying SGX-listed CPFIS-OA purchase may be sold one trading day later if entered successfully and sufficient funds/limits exist.
6.7 Service providers
Section titled “6.7 Service providers”| Product | Route |
|---|---|
| Fixed deposits | included banks |
| Government bonds/T-bills, statutory-board bonds | permitted bond dealers/brokers |
| Guaranteed bonds | brokers |
| Annuities/endowments/ILPs | included insurers |
| Unit trusts | fund managers/administrators |
| Fund-management accounts | approved fund managers |
| Shares, property funds, corporate bonds, ETFs | brokers |
| Gold ETFs / other gold products | brokers / the permitted agent-bank route (currently UOB) |
6.8 Product inclusion criteria
Section titled “6.8 Product inclusion criteria”Products generally require provider application and CPF Board review. Investments must normally be in Singapore dollars and cannot be assigned, pledged or used as collateral. Criteria cover included banks and credit quality; scripless SGD government securities; Mainboard listing and disclosure for statutory-board/government-guaranteed/corporate bonds; life-insured and maturity restrictions for insurance; fund-manager eligibility and peer/expense/track-record requirements for unit trusts; SGX listing/physical replication/tracking/expense requirements for ETFs; Singapore incorporation/Mainboard/proxy rights/watch-list restrictions for shares and property funds; credit ratings and disclosure for corporate bonds; and physical-gold/backing/proxy requirements for gold ETFs.
OA investment limits: up to 35% of investable savings for shares, property funds/REITs and corporate bonds; up to 10% for gold products. SA permits specified lower-risk products and selected ILPs/unit trusts/ETFs, subject to CPF classification.
6.9 Transfers
Section titled “6.9 Transfers”Members may transfer cash from the CPF Investment Account to OA. The bank automatically transfers cash if the account is inactive for two consecutive months, and unused IPO application money is returned.
6.10 Profits and losses
Section titled “6.10 Profits and losses”Dividends/profits remain in CPF and cannot be withdrawn as ordinary cash; losses do not need to be made good.
6.11 Charges
Section titled “6.11 Charges”Charges may be paid from CPF savings. Sales charges were removed from October 2020 and the wrap-fee cap reduced to 0.4% after earlier reductions.
6.12 Release at age 55
Section titled “6.12 Release at age 55”Investment holdings/cash may be released subject to the required retirement sum — FRS, or BRS with sufficient property charge/pledge. Without the requirement, holdings remain within CPF and sale proceeds return to the relevant CPF account.
6.13 Bankruptcy
Section titled “6.13 Bankruptcy”Undischarged bankrupts may hold or liquidate existing CPFIS investments but cannot make new investments; CPFIS assets remain protected from creditor/Official Assignee claims while within the scheme.
6.14 Death
Section titled “6.14 Death”CPFIS investments and OA investment-account cash form part of the estate and are not covered by CPF nomination. Insurance policies with valid revocable nominations may pay nominated beneficiaries directly; otherwise the administrator/executor needs Letters of Administration or Grant of Probate. Protection may cease after death and assets can meet creditor claims under probate law.
Exam cues
Section titled “Exam cues”- OA vs SA: OA needs a CPF Investment Account; SA does not. Agent bank is one of DBS/OCBC/UOB and only one account.
- Numbers: S$20,000 OA / S$40,000 SA retention (first S$60,000); 35% shares/property/REITs/corporate bonds; 10% gold; wrap-fee cap 0.4%; sales charges removed Oct 2020.
- No assignment, pledge or collateralisation of CPFIS investments.
- At 55: release only if the retirement sum (FRS, or BRS with property charge/pledge) is met.
- Death: CPFIS falls into the estate — CPF nomination does not cover it (unlike the CPF monies themselves).
- Trap: profits stay inside CPF (no ordinary cash), but losses need not be made good.