Central Provident Fund (CPF) Updates in 2014

Sav­ings in the CPF Spe­cial and Medis­ave Account (SMA) cur­rently earn the high­er of either 4% or the 12-month aver­age yield of 10-year Singa­pore Gov­ern­ment Secur­it­ies (10YSGS) plus 1%. The interest rate on SMA sav­ings is adjus­ted quarterly, based on interest rates on 10YSGS over a pre­ced­ing 12-month peri­od. The aver­age yield of the 10YSGS plus 1%, from 1 Decem­ber 2012 to 30 Novem­ber 2013, is 2.93%. There­fore, the interest rate for CPF SMA will con­tin­ue to be 4% p.a. from 1 Jan 2014 to 31 March 2014.

Sav­ings in CPF Retire­ment Account (RA) earn the high­er of either  4% or the 12-month aver­age yield of the 10YSGS plus 1%, and adjus­ted yearly. There­fore, the 4% p.a. interest rate will apply to CPF RA from 1 Janu­ary 2014 to 31 Decem­ber 2014.

The addi­tion­al 1% interest will con­tin­ue to be paid on the first $60,000 of the com­bined bal­ances, with up to $20,000 from the Ordin­ary Account (OA). The addi­tion­al interest received on the OA will go into the SA or RA to enhance the retire­ment sav­ings.

From 1 Janu­ary 2014, the Medis­ave Required Amount (MRA) will be adjus­ted to $40,500 from the cur­rent $38,500, which is the same as the Medis­ave Min­im­um Sum (MMS). This is the amount that CPF mem­bers are required to top up to the Medis­ave Account (MA) to the cur­rent MMS/MRS when they make a CPF with­draw­al at age 55.

CPFB will dis­trib­ute $29m of sur­plus from its Depend­ants’ Pro­tec­tion Scheme (DPS) to mem­bers who had act­ive cov­ers when DPS was privat­ised on 17 Septem­ber 2005. This rebate will be cred­ited to their CPF OA on 15 Decem­ber 2013.

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