4% Floor Rate for CPF Special, Medisave and Retirement Accounts

CPF Board has just announced the exten­sion of the floor rate of 4% interest p.a. for Spe­cial, Medis­ave and Retire­ment Account (SMRA) till 31 Decem­ber 2012.

Since 1 Janu­ary 2008, sav­ings in SMRA have been inves­ted in Spe­cial Gov­ern­ment Secur­it­ies (SSGS) which earn an interest rate pegged to the 12-month aver­age yield of 10-year Singa­pore Gov­ern­ment Secur­it­ies (10YSGS) plus 1%. The aver­age yield of the 10YSGS plus 1%, from 1 Septem­ber 2010 to 31 August 2011, works out to be 3.30%. As this is lower than the floor rate of 4%, CPF mem­bers will con­tin­ue to enjoy the 4% interest p.a..

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).  There­fore, the SMRA mon­ies which form the first $60,000 of a member’s com­bined bal­ances will there­fore con­tin­ue to earn a 5% interest rate.

From 1 Jan 2013, the SMRA rates will be pegged to the 12-month aver­age yield of 10YSGS plus 1%, sub­ject to a floor rate of 2.5% per annum.

Source : http://mycpf.cpf.gov.sg/CPF/News/News-Release/N_30September2011.htm

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