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Minimum 4% interest rate for Special, Medisave and Retirement Account monies to be extended until 31 December 2014<p> </p><table border="0" cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td valign="top"> </td><td valign="top"> <span class="blackhighlight"><strong>One–Year Extension of 4% Floor Rate for all SMRA monies</strong></span></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top">Since 1 January 2008, savings in the Special, Medisave and Retirement Account (SMRA) have been invested in Special Singapore Government Securities (SSGS) which earn an interest rate pegged to the 12-month average yield of 10-year Singapore Government Securities (10YSGS) plus 1%. This is a market-based rate for instruments of comparable risk and duration, and will ensure that members receive fair and reasonable interest rates.</td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>To help members cope with the transition, the Government had committed to providing a 4% floor rate for SMRA interest for two years up to December 2009. This was subsequently extended in light of global economic conditions and the fact that interest rates had been exceptionally low. The 4% floor rate is currently due to expire on 31 December 2013.</p></td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>In view of the uncertainty in the global economy and low interest rate environment, the Government has decided to further extend the 4% floor rate for interest earned on all SMRA monies for another year until 31 December 2014. SMRA monies within the first $60,000 of a member’s combined balances will therefore continue to earn a 5% interest rate. </p></td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>From 1 January 2015, the SMRA rates will be pegged to the 12-month average yield of 10YSGS plus 1%, subject to the statutory floor rate of 2.5% per annum that applies to all CPF accounts.</p></td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"> <span class="blackhighlight"> <strong>CPF Interest Rate for Special and Medisave Accounts from 1 October 2013 to 31 December 2013</strong><strong> </strong></span></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top">CPF members will continue to enjoy a risk-free interest rate of 4% on their Special and Medisave Accounts (SMA) from 1 October 2013 to 31 December 2013, as the 12-month average yield of 10YSGS plus 1% from 1 September 2012 to 31 August 2013 works out to be 2.68%, which is below the current floor of 4%.</td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>This is in line with the Government’s announcement made in September 2012 to maintain the 4% p.a. floor rate for interest earned on all SMA monies and Retirement Account (RA) monies until 31 December 2013.<br><br>Please refer to <a href="#AnnexA">Annex A</a> for the 10-year SGS yield.</p></td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p> <span class="blackhighlight"> <strong>Background information on other announcements related to CPF Interest Rates for SMA and RA monies </strong></span></p><p> <strong></strong> <span class="blackhighlight"> <strong>Additional Interest of 1%</strong></span></p><p>As part of the Government’s efforts to enhance CPF members’ retirement savings, an additional 1% interest will continue to 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 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% interest will still be earned on his combined balances including the savings used for CPF LIFE. </p></td></tr><tr><td valign="top"> </td><td valign="top"> <span class="blackhighlight"> <br> <span class="blackhighlight"> <strong>Interest Rate for SMA monies </strong></span></span></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>Savings in the SMA currently earn either 4% or the 12-month average yield of 10-year Singapore Government Securities (10YSGS) plus 1%, whichever is the higher. The interest rate on SMA savings is adjusted quarterly, based on interest rates on 10YSGS over a preceding 12-month period. </p></td></tr><tr><td> </td></tr><tr><td valign="top"> </td><td valign="top"> <span class="blackhighlight"> <br> <span class="blackhighlight"> <strong>Interest Rate for RA monies</strong></span></span></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>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 the 4% floor, whichever is the higher. The fixed coupon rate is adjusted yearly in January.</p><p>The interest rate to be credited to the RA is the weighted average interest rate of the entire portfolio of SSGS, and adjusted yearly in January. As announced on 21 December 2012, the interest rate payable to CPF members on their RA balances from 1 January 2013 to 31 December 2013 will be 4%.</p></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"><table width="100%" border="0"><tbody><tr><td valign="top"> <span class="blackhighlight"> <u> <strong>Public Enquiries</strong></u></span></td></tr><tr><td valign="top"> <font face="Arial, Helvetica, sans-serif" size="2">For more information, please visit <a href="http://www.cpf.gov.sg/">www.cpf.gov.sg</a> or call the CPF Call Centre at 1800-227-1188. </font></td></tr></tbody></table></td><td> </td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"></td><td valign="top"><p> </p></td></tr><tr><td valign="top"> </td><td valign="top"><div align="right"> <a name="AnnexA"></a> <span class="blackhighlight"> <a name="AnnexA"></a> <strong>Annex A</strong></span></div></td></tr><tr><td valign="top"> </td><td valign="top"> </td></tr><tr><td valign="top"> </td><td valign="top"><table width="100%" border="0" cellspacing="0" cellpadding="2"><tbody><tr bgcolor="#dddddd"><td colspan="2"> <span class="blackhighlight"> <strong>Computation of Interest Rate Peg</strong></span></td></tr><tr align="left" valign="top"><td width="75%">Average yield of 10YSGS from 1 September 2012 to 31 August 2013</td><td width="25%">1.68% (Note 1)</td></tr><tr align="left" valign="top"><td width="75%">Plus 1%</td><td width="25%"> <u>1.00%</u></td></tr><tr align="left" valign="top"><td width="75%">Computed Interest Rate Peg (yield of 10-Year SGS + 1%)</td><td width="25%"> <u> <u>2.68%</u></u></td></tr></tbody></table></td></tr><tr><td valign="top"> </td><td valign="top"> </td></tr><tr><td valign="top"> </td><td valign="top">Note:</td></tr><tr><td valign="top"> </td><td valign="top">1. Source: Yields of 10-Year Singapore Government Securities are obtained from <a href="http://www.sgs.gov.sg/">www.sgs.gov.sg</a></td></tr><tr><td> </td></tr><tr><td> </td></tr><tr><td valign="top"> </td><td valign="top"><p align="center"> <span class="blackhighlight"> <strong>10-Year SGS Yield from September 2012 to August 2013</strong></span></p><p align="center"> <span class="blackhighlight"> <img src="/Assets/members/PublishingImages/10YRSGS_27Sep13.jpg" alt="10-Year SGS Yield from September 2012 to August 2013" style="width:80%;height:auto;" /></span> </p></td></tr></tbody></table>Minimum 4% interest rate for Special, Medisave and Retirement Account monies to be extended until 31 December 2014TrueTrueTrue

 

 

Minimum 4% interest rate for Special, Medisave and Retirement Account monies to be extended until 31 December 2014<p> </p><table border="0" cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td valign="top"> </td><td valign="top"> <span class="blackhighlight"><strong>One–Year Extension of 4% Floor Rate for all SMRA monies</strong></span></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top">Since 1 January 2008, savings in the Special, Medisave and Retirement Account (SMRA) have been invested in Special Singapore Government Securities (SSGS) which earn an interest rate pegged to the 12-month average yield of 10-year Singapore Government Securities (10YSGS) plus 1%. This is a market-based rate for instruments of comparable risk and duration, and will ensure that members receive fair and reasonable interest rates.</td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>To help members cope with the transition, the Government had committed to providing a 4% floor rate for SMRA interest for two years up to December 2009. This was subsequently extended in light of global economic conditions and the fact that interest rates had been exceptionally low. The 4% floor rate is currently due to expire on 31 December 2013.</p></td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>In view of the uncertainty in the global economy and low interest rate environment, the Government has decided to further extend the 4% floor rate for interest earned on all SMRA monies for another year until 31 December 2014. SMRA monies within the first $60,000 of a member’s combined balances will therefore continue to earn a 5% interest rate. </p></td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>From 1 January 2015, the SMRA rates will be pegged to the 12-month average yield of 10YSGS plus 1%, subject to the statutory floor rate of 2.5% per annum that applies to all CPF accounts.</p></td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"> <span class="blackhighlight"> <strong>CPF Interest Rate for Special and Medisave Accounts from 1 October 2013 to 31 December 2013</strong><strong> </strong></span></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top">CPF members will continue to enjoy a risk-free interest rate of 4% on their Special and Medisave Accounts (SMA) from 1 October 2013 to 31 December 2013, as the 12-month average yield of 10YSGS plus 1% from 1 September 2012 to 31 August 2013 works out to be 2.68%, which is below the current floor of 4%.</td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>This is in line with the Government’s announcement made in September 2012 to maintain the 4% p.a. floor rate for interest earned on all SMA monies and Retirement Account (RA) monies until 31 December 2013.<br><br>Please refer to <a href="#AnnexA">Annex A</a> for the 10-year SGS yield.</p></td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p> <span class="blackhighlight"> <strong>Background information on other announcements related to CPF Interest Rates for SMA and RA monies </strong></span></p><p> <strong></strong> <span class="blackhighlight"> <strong>Additional Interest of 1%</strong></span></p><p>As part of the Government’s efforts to enhance CPF members’ retirement savings, an additional 1% interest will continue to 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 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% interest will still be earned on his combined balances including the savings used for CPF LIFE. </p></td></tr><tr><td valign="top"> </td><td valign="top"> <span class="blackhighlight"> <br> <span class="blackhighlight"> <strong>Interest Rate for SMA monies </strong></span></span></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>Savings in the SMA currently earn either 4% or the 12-month average yield of 10-year Singapore Government Securities (10YSGS) plus 1%, whichever is the higher. The interest rate on SMA savings is adjusted quarterly, based on interest rates on 10YSGS over a preceding 12-month period. </p></td></tr><tr><td> </td></tr><tr><td valign="top"> </td><td valign="top"> <span class="blackhighlight"> <br> <span class="blackhighlight"> <strong>Interest Rate for RA monies</strong></span></span></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"></td></tr><tr><td valign="top"> </td><td valign="top"><p>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 the 4% floor, whichever is the higher. The fixed coupon rate is adjusted yearly in January.</p><p>The interest rate to be credited to the RA is the weighted average interest rate of the entire portfolio of SSGS, and adjusted yearly in January. As announced on 21 December 2012, the interest rate payable to CPF members on their RA balances from 1 January 2013 to 31 December 2013 will be 4%.</p></td></tr><tr><td> </td></tr><tr><td valign="top"></td><td valign="top"><table width="100%" border="0"><tbody><tr><td valign="top"> <span class="blackhighlight"> <u> <strong>Public Enquiries</strong></u></span></td></tr><tr><td valign="top"> <font face="Arial, Helvetica, sans-serif" size="2">For more information, please visit <a href="http://www.cpf.gov.sg/">www.cpf.gov.sg</a> or call the CPF Call Centre at 1800-227-1188. </font></td></tr></tbody></table></td><td> </td></tr><tr><td valign="top"> </td><td valign="top"></td></tr><tr><td valign="top"></td><td valign="top"><p> </p></td></tr><tr><td valign="top"> </td><td valign="top"><div align="right"> <a name="AnnexA"></a> <span class="blackhighlight"> <a name="AnnexA"></a> <strong>Annex A</strong></span></div></td></tr><tr><td valign="top"> </td><td valign="top"> </td></tr><tr><td valign="top"> </td><td valign="top"><table width="100%" border="0" cellspacing="0" cellpadding="2"><tbody><tr bgcolor="#dddddd"><td colspan="2"> <span class="blackhighlight"> <strong>Computation of Interest Rate Peg</strong></span></td></tr><tr align="left" valign="top"><td width="75%">Average yield of 10YSGS from 1 September 2012 to 31 August 2013</td><td width="25%">1.68% (Note 1)</td></tr><tr align="left" valign="top"><td width="75%">Plus 1%</td><td width="25%"> <u>1.00%</u></td></tr><tr align="left" valign="top"><td width="75%">Computed Interest Rate Peg (yield of 10-Year SGS + 1%)</td><td width="25%"> <u> <u>2.68%</u></u></td></tr></tbody></table></td></tr><tr><td valign="top"> </td><td valign="top"> </td></tr><tr><td valign="top"> </td><td valign="top">Note:</td></tr><tr><td valign="top"> </td><td valign="top">1. Source: Yields of 10-Year Singapore Government Securities are obtained from <a href="http://www.sgs.gov.sg/">www.sgs.gov.sg</a></td></tr><tr><td> </td></tr><tr><td> </td></tr><tr><td valign="top"> </td><td valign="top"><p align="center"> <span class="blackhighlight"> <strong>10-Year SGS Yield from September 2012 to August 2013</strong></span></p><p align="center"> <span class="blackhighlight"> <img src="/Assets/members/PublishingImages/10YRSGS_27Sep13.jpg" alt="10-Year SGS Yield from September 2012 to August 2013" style="width:80%;height:auto;" /></span> </p></td></tr></tbody></table>Minimum 4% interest rate for Special, Medisave and Retirement Account monies to be extended until 31 December 201426/9/2013 4:00:00 PMhttps://null/common/Lists/News/DispForm.aspx?ID=2000Central Provident Fund Board

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