Breaking Down Your “Kopi-Money”: CPF Changes for September 2023 and January 2024

Changes to your CPF in September 2023 and January 2024
Reading Time: 6 minutes

Wah, CPF changes again ah? We’ve got your back, friends! In this post, we’ll simplify the CPF updates for you, so you may sip your kopi leisurely instead of browsing through countless resources on the CPF website. Take note that these updates are mainly about the 1) CPF Ordinary Wage (OW) Ceiling and 2) Contribution Rates for Seniors, effective September 2023 and January 2024.

Breaking Down Your “Kopi-Money”: CPF Changes effective September 2023

In case you didn’t already know, “CPF” is the abbreviation for the “Central Provident Fund”. It’s like a retirement fund mandatory for all Singaporeans. This fund can be used for various purposes in most stages of your life, including housing and healthcare. Now that we’ve gotten a rough sense of what CPF is, let’s make sense of the latest changes to the CPF Ordinary Wage (OW) Ceiling and Contribution Rates starting from 1 September 2023 and beyond.

Part 1: CPF OW Ceiling – Climbing up the Ladder

Imagine if your “kopi-money” jar could hold more coins. That’s essentially what’s happening with the CPF Ordinary Wage Ceiling.

Photo by Towfiqu barbhuiya on Unsplash

Starting from September 1, 2023, the CPF Ordinary Wage (OW) ceiling will be increased from $6,000 to $8,000. This means you and your employer (yes, them too!) are required to make CPF contributions on your ordinary wages of up to $8,000 per month instead of the previous $6,000. This also means that more of your salary can contribute towards your CPF savings (i.e. “kopi-money jar”).  Here’s a quick snapshot:

Wages ClassificationCPF OW Ceiling until August 2023CPF OW Ceiling from September 2023 onwards
Ordinary WagesUp to $6,000From $6300 and up to $8,000
A Quick Glance: CPF Ordinary Wage Ceiling changes from September 2023 onwards

However, note that the jump wouldn’t be a straight jump from $6000 to $8000. Instead, it will be phased in slowly over four phases, giving both you and your employer time to get used to the new rules.

Photo by Jakob Braun on Unsplash

Note that the annual salary ceiling (which sets the maximum amount of CPF contributions payable for all salaries received in the year, inclusive of both Ordinary Wages and Additional Wages) of $102,000 in the CPF remains unchanged. 

CPF Ordinary Wage (OW) CeilingDifferenceCPF Annual Salary CeilingDifference
From 1 Jan 2016 to 31 Aug 2023$6,000N.A.$102,000N.A.
From 1 Sep to 31 Dec 2023$6,300+$300$102,000$0
From 1 Jan to 31 Dec 2024$6,800+$500$102,000$0
From 1 Jan to 31 Dec 2025$7,400+$600$102,000$0
From 1 Jan 2026$8,000+$600$102,000$0
In Phases: CPF Ordinary Wage Ceiling increments from September 2023 onwards

With the increase in Ordinary Wage Ceiling from September 2023, how should I then calculate the Additional Wage ceiling?

If your employee earns more than $6,000 per month in Ordinary Wages (OW), the anticipated Additional Wage (AW) ceiling for 2023 should be $102,000 – ($6,000 x 8) – ($W x 4) where W is capped at the Ordinary Wage (OW) ceiling of $6,300 beginning in September 2023. Note: ‘8’ represents the months from January to August inclusive, while ‘4’ represents the months from September to December inclusive.

If your employee’s monthly OW is $7,000, the predicted AW ceiling in 2023 will be $28,800 rather than $30,000. You must contribute to CPF on the AW up to $28,800.

$102,000 - ($6000*8) - ($6300*4) = $28,800

Part 2: Securing the Golden Years – Increase in CPF Contribution Rates from 2024 for Senior Workers

The changes do not, however, end at the OW ceiling. Effective 1 January 2024, the CPF Contribution Rates for employees aged 55 to 70 will increase. It’s as if your really nice relative, Old Uncle Lim, is increasing the amount of angbao money he gives you as you get older, to ensure that you are able to afford a home for your senior years. That is, if you’re still receiving angbao money from your older relatives at age 55 (we ain’t judging).

Photo by David Valentine on Unsplash

Let’s look at the changes here (for simplicity’s sake, let’s assume a minimum income of $750 per month):

Employee’s age (years)Current Contribution
1 Jan 2024 Contribution
Current Contribution
(by Employer)
1 Jan 2024 Contribution
(by Employer)
Current Contribution
(by Employee)
1 Jan 2024 Contribution
(by Employee)
55 and below3737 (no change)1717 (no change)2020 (no change)
Above 55 to 6029.531 (+1.5)14.515 (+0.5)1516 (+1)
Above 60 – 6520.522 (+1.5)1111.5 (+0.5)9.510.5 (+1)
Above 65 to 7015.516.5 (+1)8.59 (+0.5)77.5 (+0.5)
Above 7012.512.5 (no change)7.57.5 (no change)55 (no change)
CPF Contribution Rates in % for Senior Workers Aged 55-70, earning $750 or more per month

For the full rates, you may download the Complete CPF Contribution Rates Table (2024) PDF file on the CPF site.

Show Me the Numbers!

Alright, let’s roll up our sleeves and dive into some figures. To help you understand the changes better, let’s look at some real-life illustrations of workers like you and I.

Example 1: Increased Savings for Higher Wage Earners

Meet Mr Tan, a 58-year-old manager who earns $2,500 every month. With the enhanced CPF Contribution Rates for 2024, a larger amount of his earnings will be donated to his CPF accounts, resulting in faster growth of his retirement savings. This is how much more he would have in his CPF account in say, January 2024.

Employee’s ageNew Contribution from 1 Jan 2024
New Contribution from 1 Jan 2024
(by Employer)
New Contribution from 1 Jan 2024
(by Employee)
Above 55 to 6031% x $2,500 = $77515% x $2,500 = $37516% x $2,500 = $400
Example: CPF Contribution amounts for Mr Tan, 58 years old, earns $2,500 every month

If we compared this to say, December 2023, Mr Tan would be getting only:

29.5% x $2,500 = $738 (rounded off to the nearest dollar)

The difference between Dec 2023 and January 2024 = +$37 ($775 – $738)

This means Mr Tan now has an additional $37 for kopi every month (and more actually, since this amount would be compounded in his CPF account based on the interest rates)!

Example 2: Increased Savings for Higher Wage Earners

Consider Ms Koh, a 30-year old white-collar professional earning $6,800 per month. With the increase in the September 2023 CPF OW Ceiling, she would now contribute more to her CPF accounts each month. Let’s explore how much more her CPF contribution would increase through the various phases, from August 2023 to Jan 2024.

CPF Ordinary Wage (OW) Ceiling for Ms Koh, who earns $6,800 per month
From 1 Jan 2016 to 31 Aug 2023Capped at $6,000, even though salary is $6,800
From 1 Sep to 31 Dec 2023Capped at $6,300, even though salary is $6,800
From 1 Jan 2016 to 31 Aug 2023Amount is fully maximised at $6,800
Example: CPF Contribution amounts for Mr Tan, 58 years old, earns $2,500 every month
CPF Contribution Rate (%)CPF Contribution Rate (%)CPF OW CeilingCPF Contribution Amount ($6,800 salary)Difference
Aug 202337%37% (no change for aged 55 and below)$600037% x $6,000 = $2,220N.A.
Dec 202337%37% (no change for aged 55 and below)$630037% x $6,300 = $2,331+$111
Jan 202437%37% (no change for aged 55 and below)$680037% x $6,800 = $2,516+$185
Example : CPF Contribution amounts for Ms Koh, 30 years old, earns $6,800 every month

Just remember though, these are illustrative figures. The actual numbers might differ a bit due to things like rounding off to the nearest dollar (after all, every cent counts!). Take note of the CPF Annual Salary Ceiling as well! For Ms Koh and Mr Tan, they have not hit the ceiling of $102,000, hence we will leave the figures to be as accurate as shown.

What Does All This Mean for Me?

Basically, if you earn more than $6,000 a month, you’re in for a bigger “kopi-money” jar.

By extending the CPF contribution ceiling, you can save more in your CPF accounts, which can be used for housing, healthcare, and retirement purposes. 

Did you know?
You may use your CPF to invest in stocks, bonds, and other types of funds! Now, you may need an even bigger “kopi-money jar” for the increase in funds. 


If you’re a business, it involves a bit more financial commitment on your part, but happier employees are always a good thing, right?

It’s important to remember that while these adjustments are intended to give your employees a stronger social safety net, don’t forget to pay attention to your business’s financial health in lieu of the upcoming changes.

A Helping Hand with Talenox

Navigating through these CPF changes can feel like learning to ride a bicycle for the first time – a tad tricky. That’s where Talenox comes in. We’re like your friendly neighbour, making sure you stay on track with the CPF guidelines. As a dedicated suite designed to streamline payroll and leave, Talenox ensures you’re always compliant with the latest CPF regulations.

Employing smart automation, Talenox can calculate and process CPF contributions based on the newest rates, eliminating any risk of non-compliance. By doing so, businesses can focus more on their core operations, leaving the intricate details of payroll management to Talenox.

If you’ve got any questions, give us a shout in the comments form below. If you find this article useful, you may even buy us a cup of kopi.

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