What is CPF ?what can CPF be used for?

GPF & CPF - which one is better?

• GPF & CPF - which one is better? I happened to join the govt. service on August, 2006. Am I still entitled to subscribe to CPF. Please elaborate on advantages and disadvantages on GPF & CPF. Are they compulsory? Can I skip both and instead invest in mutual funds through SIPs?

• Answer:

  Provision GPF allows employees of Govt. establishment to compulsorily deposit a certain percentage of amount from his or her Basic pay. This amount is kept in the name of the employee in a separate account and can draw his entire deposited amount with its interest at the time of retirement/ super annuation. However, in case of necessity, a certain amount can be widrawan from the said account. Whereas, the provision of CPF allows only to the employees of public Sector Undertakings and Private Cmapanys so far. It is contributory in nature, a certain amount of money is deducted from the salary of the employee and similar amount is contributed by the Esstt. and keep in employees PF acctt. Other provision of widrawal etc. of GPF and CPF are same, I guess.