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News Release by:
Central Provident Fund Board
16 June 2008 --
From 1 January this year, interest rate for savings in the Special, Medisave and Retirement Accounts (SMRA) is pegged to the 12-month average yield of the 10-year Singapore Government Security (10YSGS) plus 1%. The average yield of the 10YSGS over one year, from 1 June 2007 to 31 May 2008, plus 1% works out to be 3.65%.
To help CPF members adjust to the floating SMRA rate, the Government will maintain the 4% floor rate for two years if the 10YSGS yield plus 1% is below 4%. After two years, the 2.5% floor rate will apply for all CPF accounts.
Hence, the SMRA interest rate paid from 1 July 2008 to 30 September 2008 will be 4% (floor rate).
Additional Interest of 1%
An additional 1% interest will be paid on the first $60,000 of a member's combined balances, with up to $20,000 from the Ordinary Account (OA). The additional interest received on the OA will go into the member's Special or Retirement Account to enhance his retirement savings.
The CPF interest rate will continue to be reviewed quarterly. Improving returns on CPF savings is one of the key changes introduced to help Singaporeans improve their retirement adequacy.
For the computation of the CPF interest rate for SMRA and the 10-year SGS yield, please refer to Annex A.
Members with enquiries may call the CPF Call Centre on 1800-227 1188.
Annex A
| Computation of Special, Medisave and Retirement Accounts (SMRA) interest rates for July to September 2008 | |
| Average yield of 10-Year SGS from Jun 07 to May 08 |
2.65% |
(Note 1) |
| Plus 1% |
1.00% |
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| Computed SMRA Interest Rate for Jul 08 to Sep 08 |
3.65% |
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| SMRA Interest Rate (Jul 08 to Sep 08) |
4.00% |
(Note 2) | |
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| Note |
| 1. |
Source: Yields of 10-Year Singapore Government Securities are obtained from http://www.sgs.gov.sg |
| 2. |
A floor of 4% for the SMRA rate will be maintained for two years from 1 January 2008. It will be lifted after 2 years, and the 2.5% floor rate will apply for all CPF accounts thereafter. | |
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| 10-Year SGS Yield from June 2007 to May 2008 |
10-Year SGS Yield
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