The OA interest rate of at least 2.5% is higher than that of banks, including fixed deposits. This sum of money will also provide greater convenience to be used as your emergency housing savings as compared to fixed deposits which may result in interest lost due to early withdrawal.
While retaining more in the OA may mean having to take a bigger loan, the current interest rates for bank loans are far lower. Even though the interest rate for HDB housing loan may be slightly higher at 2.6%, this may be a small cost in exchange for maintaining an emergency fund which provides you a peace of mind.
*Additional 1% is paid on the first $60,000 across all CPF accounts, which is capped at $20,000 for the OA. It will first be credited to the RA or SA.
