Dear readers, with a brand new year 2025 coming, there will definitely be a slew of new measures and policies that will continue to shape our lives.
First up, on the financial front and which I believe will impact quite a number of folks will be the increase in CPF monthly salary ceiling.
As announced in Budget 2023, the CPF monthly salary ceiling will be gradually raised to $8,000 in 2026.
The ceiling is $6,800 this year and will increase by $600 to $7,400 from 1 January 2025.
With CPF at 20%, that means for those eligible employees, their taking home in cash from salary will be 20% of $600 (i.e. $120) less every month but that also means an additional of $120 more each month to the CPF accounts.
Coupled with compounding of interest rates, the $120 per month will grow more and more than the actual $120 per month eligible employees contribute to.