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Interest Rates
 

Interest Rates

CPF Interest Rates (01 Oct 2014 to 31 Dec 2014)
(reviewed quarterly)
Ordinary Account 2.50% p.a.
Special & Medisave Accounts 4.00% p.a.

 
CPF Interest Rates (01 Jan 2014 to 31 Dec 2014)
(reviewed yearly)
Retirement Account 4.00% p.a.

Note: Special Singapore Government Securities (SSGS) are non-tradable bonds issued specifically to CPF Board, Singapore's national pension fund. Singaporean's CPF monies are invested in these special securities, which are guaranteed by the Government.

Interest Rate for Ordinary Account Monies

Savings in the Ordinary Account (OA) earn either the legislated minimum 2.5% per annum or the 3-month average of major local banks’ 12-month fixed deposit and month-end savings rates, whichever is higher.

The computed interest rate derived from the major local banks’ interest rates from May 2014 to July 2014 works out to be 0.21% per annum. As this is below the legislated minimum of 2.5% per annum, the OA interest rate for 1 October 2014 to 31 December 2014 will be maintained at the floor of 2.5% per annum.

Interest Rate for Special and Medisave Account Monies

Savings in the Special and Medisave Account (SMA) earn either 4% per annum or the 12-month average yield of 10-year Singapore Government Securities (10YSGS) plus 1%, whichever is higher. The interest rate on SMA savings is adjusted quarterly, based on the interest rates on 10YSGS over a preceding 12-month period.

The average yield of the 10YSGS plus 1%, from August 2013 to July 2014, works out to be 3.41% per annum. As this is below the current floor of 4% per annum, the SMA interest rate for 1 October 2014 to 31 December 2014 will be maintained at the floor of 4% per annum.

Additional Interest of 1% to help you grow your savings

As part of the government’s efforts to enhance the retirement savings of CPF members, an additional 1% per annum interest will continue to be paid on the first $60,000 of a member’s combined balances, with up to $20,000 from OA. This works out to be 3.5% per annum earned on the first $20,000 in a member’s OA, and 5% per annum earned on the first $40,000 (up to $60,000 if no OA savings) in a member’s SMA and Retirement Account (RA). About two-thirds of all CPF members are earning up to 5% interest on all of their Special, Medisave and Retirement Account Savings.

The additional interest received on the OA will go into the member’s Special Account (SA) or RA to enhance his retirement savings. If a member is above 55 years old and participates in the CPF LIFE scheme, the additional 1% per annum interest will still be earned on his combined balances, which includes the savings used for CPF LIFE.

Interest Rate for Retirement Account Monies

New RA savings are invested in SSGS which earn a fixed coupon equal to either the 12-month average yield of the 10YSGS plus 1% at the point of issuance, or 4% per annum, whichever is the higher, adjusted yearly.

Given the lower 10YSGS yield, new RA savings will earn a fixed coupon of 4% (floor rate).

The interest rate to be credited to the RA is the weighted average interest rate of the entire portfolio of these SSGS, and adjusted yearly in January. The weighted average interest of the entire portfolio of these SSGS is 4% at the moment, so the interest rate payable to CPF members on their RA balances from 1 January 2014 to 31 December 2014 will be 4% per annum, as announced on 13 December 2013.

Details on how CPF interest rates are computed can be found in News Releases.

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CPF Interest Rates 1955 - 2014 (0.08MB)

 Last Updated on: Tuesday, September 30, 2014 at 5:25 PM
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