A Singapore Government Agency Website

16 Jan 2026

SOURCE: CPF Board

husband and wife unpacking for their new home
In a nutshell:

  • Use a combination of your cash and CPF Ordinary Account (OA) savings to fund your home purchase. Grants like the Proximity Housing Grant can help offset some of your housing costs.

  • The Home Purchase Planner can help you estimate your home purchase budget that fits your current and future needs.

  • There are ways to continue growing your CPF savings, including topping up your Special Account (SA) or through the CPF Investment Scheme (CPFIS).

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Buying a home is often your biggest expense, but it doesn’t have to drain all your savings. Understanding your options can help you balance housing costs today while still preparing for what’s ahead. Here’s how.

How much of your CPF Ordinary Account (OA) savings should you use for your home purchase?

When it comes to using your CPF Ordinary Account (OA) for housing, you may have heard differing opinions. While it's true that using your OA savings for your home helps to reduce your immediate cash outlay, it also means you're reducing your ability to grow those savings for retirement. Therefore, it's important to consider the bigger picture.A combination of cash and OA savings for your home purchase allows you to: 

  • Preserve your CPF savings for long-term goals such as retirement.
  • Still meet your immediate housing needs, while giving you the flexibility to finance your home without affecting your future retirement payouts.

The recommendation is to keep at least $20,000 in your CPF OA. This buffer ensures that you have enough to cover personal decisions such as taking a career break or facing unforeseen circumstances (like job loss or health concerns). This means that your home payments won’t be disrupted, giving you more financial flexibility.

What other role does the CPF OA serve aside from housing needs?

The CPF OA is also meant for your retirement needs. It offers a risk-free interest rate of 2.5% per annum1. Compared to other investment options, such as fixed deposits (which as of December 2025, ranged from 0.8% to 1.6% per annum) or the 6-month T-bill yield (1.41% as of 4 December 2025), or the 1-year T-bill (1.35% as of the last Auction on 15 October 2025), the OA provides a reliable and steady way to grow your CPF savings.
 

Source: https://www.mas.gov.sg/bonds-and-bills/treasury-bills-statistics
 

1Members will earn an extra interest of 1% per annum on the first $60,000 of combined CPF balances (capped at $20,000 for OA). Extra interest earned from OA balances will go into your SA.

Therefore, if you leave $20,000 in your OA instead of using it to pay for your home, in 20 years, it will grow to around $39,700 – almost doubling your savings!
 

Use the CPF housing usage calculator to calculate the exact amount of OA you can use.

How does retaining $20,000 affect your monthly instalments?

Two couples are looking to take up home loans – let’s see how their approaches would impact their finances. These are the assumptions that apply:
 

The maximum loan that can be taken: $470,000
 

Scenario A: Ben and his partner retain $20,000 each in their Ordinary Account

Scenario B: Lexie and her partner used up their entire Ordinary Account

$40,000*

Remaining balance in their Ordinary Account

$0*

Remaining balance in their Ordinary Account


Based on their respective decisions on the amount to retain in their Ordinary Account, their outstanding loans and monthly instalment are as follows:
 

Outstanding housing loan amount

$470,000

Outstanding housing loan amount

$430,000

Monthly instalment**

$2,514

Monthly Instalment**

$2,300

 
While retaining $40,000 in OA savings would mean an approximate increase of $200 on the monthly instalment, Ben and his family would enjoy better financial security, where they have enough OA to cover at least 15 months of housing repayments in the event of unexpected circumstances affecting their cashflow.

 *Assumption: Initial OA balance: $20,000, interest rate is at 2.6% and the number of years for loan repayment is 20 years


**Assumption: The total monthly instalment is divided between 2 co-owners

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https://www.cpf.gov.sg/member/home-ownership/using-your-cpf-to-buy-a-home/retain-20000-in-your-oa-if-you-are-taking-a-housing-loan?cid=cpfprel:lf:bau:fjbrs:homeownership:usingcpfforhousing:firsthome false

To take a step further, if you have plans to sell this home in the long term, take note that when you use CPF for your home, the amount withdrawn, plus the accrued interest must be restored to your CPF when you sell the property. If not planned properly, you might risk a "negative cash sale" scenario, where proceeds fall short of the outstanding loan and CPF refund, causing issues if you’re planning to upgrade or need cash for other purposes.

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Aim to keep your housing payments within your CPF monthly contribution amount, as this gives you the option to free up cash for other needs. This protects your cashflow and gives you the flexibility to save for other goals.

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How else can CPF provide support for your housing goals?

Beyond that, CPF housing grants — such as the Enhanced CPF Housing Grant and the Proximity Housing Grant (PHG) — can help finance your home. These grants not only ease your upfront costs, but the PHG can also support families who choose to live closer together.

  • The Enhanced CPF Housing Grant (EHG) is available to first-time applicants who are either applying for a new Build-To-Order (BTO) flat or buying a resale flat on the open market.
  • The Proximity Housing Grant (PHG) supports buyers purchasing a resale flat on the open market to live with or near their parents and/or married children.
What is the Proximity Housing Grant?

Staying close to and caring for your parents isn’t only about fulfilling your filial responsibilities. It can also benefit you in practical ways.
 

Here’s how these options can support your housing plans.

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When you plan your housing budget, be sure to consider interest rate changes, job stability, and future expenses (such as renovations, family needs) to ensure that your home is truly affordable. That’s why it’s advisable to keep your monthly mortgage payments within 25% of your gross monthly income.
 

If you find it to be daunting, use the Home Purchase Planner (HPP) to guide you. It helps you estimate a comfortable budget and the amount of housing loan you can take, and shows how a home purchase can impact your retirement.

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Can you continue to grow your CPF savings while financing your home?

Even if you choose to maximise your use of OA savings for housing, there are other options to help you grow your CPF savings in tandem, such as making top-ups to your Special Account (SA), making a voluntary housing refund, or investing through the CPF Investment Scheme if you are prepared to take some risk.

$100 a month for $24,000 in 15 years* - with the power of compound interest

Consider setting up a small recurring cash top-up to your SA every payday. Your SA earns a steady interest of up to 5% per annum, and you can enjoy up to $8,000 in tax relief annually.1
 

If you saved $100 a month for 15 years on your own, you would have saved around $18,000. However, if you top up $100 a month to your SA over the same period, your savings could grow to over $24,000*, by letting the power of compound interest work for you.
 

1 Terms and conditions apply
 

*Based on a floor interest rate of 4% per annum on the Special Account or Retirement Account. 

Set up a recurring cash top-up to enjoy higher payouts in retirement

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If you’re willing to take on higher risk for higher expected returns on your CPF savings, you can tap on the CPF Investment Scheme (CPFIS)  to invest part of your CPF savings in a variety of investment products with different risk and return profiles. These include Singapore Government Securities (SGS) Bonds, as well as options such as T-bills and fixed deposits.

 

As a general guide, you should consider investing your CPF savings only if you:

  • Can accept the risks that come with investments
  • Can afford to set aside the amount you plan to invest
  • Monitor your investments consistently
  • Feel confident of earning more than the CPF interest rate

Here's what you know to know about CPFIS.

Once you’ve purchased your home (congratulations!), you can also consider making voluntary housing refunds to your CPF accounts over time to grow your retirement savings and strengthen your financial future.

What's next for your CPF savings?

Learn more about making a voluntary housing refund.

Information in this article is accurate as at the date of publication.

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