SINGAPORE: In a joint statement on Tuesday (March 12), the Central Provident Board (CPF) and the Housing Development Board said that savings in the Special, MediSave, and Retirement Account (SMRA) will earn 4.05 per cent in the second quarter of 2024.
The two agencies said the SMRA pegged rate exceeds the floor rate of 4 per cent, adding that the SMRA interest rate is pegged to the 12-month average yield of 10-year Singapore Government Securities (10YSGS) plus 1 per cent.
For the first quarter of 2024, interest rates for SMRA had risen to 4.08 per cent. 2Q 2024 is the first time Special and MediSave accounts will dip after three upticks in a row.
The statement added that the interest rate of the Ordinary Account (OA) will remain the same at 2.5 per cent for this period due to the OA pegged rate remaining below the floor rate of 2.5 per cent.
“The Government will continue to ensure that the CPF interest rate pegs remain relevant in the prevailing operating environment while taking into consideration the longer-term outlook,” the CPF Board and HDB said.
The statement also states that CPF members will earn additional interest on their savings, which is part of the Government’s endeavours to enhance retirement savings for CPF members.
Members under the age of 55 will earn an additional one per cent interest on the first $60,000 of their combined balances, with a maximum cap of capped at $20,000 for Ordinary Accounts.
Meanwhile, those 55 and older will be given an additional two per cent interest on the first $30,000 of their combined balances, capped at $20,000 for OA, plus another one per cent on the next $30,000.
The additional interest on the OA balances will go to members’ Special Account (SA) or Retirement Account (RA).
“If a member is above 55 years old and participates in the CPF LIFE scheme, the extra interest will still be earned on his or her combined CPF balances, which includes the savings used for CPF LIFE,” the statement added.
HDB and the CPF Board also noted, “The OA interest rate will be maintained at 2.5 per cent per annum from 1 April 2024 to 30 June 2024.
Correspondingly, the concessionary interest rate for HDB housing loans, which is pegged at 0.1 per cent above the OA interest rate, will remain unchanged at 2.6 per cent per annum from 1 April 2024 to 30 June 2024.”
The statement from the CPF Board and HDB may be found here. More information on CPF interest rates and computations may be found here. /TISG
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