CPF interest rates from 1 January 2019 to 31 March 2019 and Basic Healthcare Sum for 2019

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CPF interest rates from 1 January 2019 to 31 March 2019

  • Up to 3.5% per annum on the Ordinary Account
  • Up to 5% per annum on the Special and MediSave Accounts
  • Up to 5% per annum on the Retirement Account
  • CPF members aged 55 and above will earn an additional 1% extra interest on the first $30,000 of their combined balances

 

HDB mortgage rate from 1 January 2019 to 31 March 2019

  • Remains unchanged at 2.6% per annum

 

Basic Healthcare Sum (BHS) for 2019

  • For members below 65 years old in 2019, BHS will be $57,200
  • For members who turn 65 years old in 2019, BHS will be $57,200 and will not change for the rest of their lives

Central Provident Fund (CPF) members will continue to earn interest rates of up to 3.5% per annum on their Ordinary Account (OA) monies, and up to 5% per annum on their Special and MediSave Accounts (SMA) monies in the first quarter of 2019. CPF members will also earn up to 5% per annum on their Retirement Account (RA) monies in 2019. These interest rates include an extra 1% interest paid on the first $60,000 of a member’s combined balances (with up to $20,000 from the OA) which is part of the Government’s efforts to enhance the retirement savings of CPF members.

 

CPF members aged 55 and above will also earn an additional 1% extra interest on the first $30,000 of their combined balances (with up to $20,000 from the OA). This is paid over and above the current extra 1% interest that is earned on the first $60,000 of their combined balances. As a result, CPF members aged 55 and above will earn up to 6% interest per year on their retirement balances.

 

The extra interest received on the OA will go into the member’s Special Account (SA) or Retirement Account (RA) to enhance his or her retirement savings. 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 balances, which includes the savings used for CPF LIFE.

 

 

Interest rate for CPF Ordinary Account and HDB mortgage rate

 

The OA interest rate will be maintained at 2.5% per annum from 1 January 2019 to 31 March 2019, as the computed rate of 0.40% is lower than the legislated minimum interest rate.

 

Correspondingly, the concessionary interest rate for HDB mortgage loans, which is pegged at 0.1% above the OA interest rate, will remain unchanged at 2.6% per annum from 1 January 2019 to 31 March 2019.

 

Please refer to Annex A for the detailed computation of the OA interest rate and HDB mortgage rate.

  

 

Interest rate for Special and MediSave accounts

 

The SMA interest rate will be maintained at 4% per annum from 1 January 2019 to 31 March 2019, as the computed rate of 3.38% is lower than the current floor interest rate of 4% per annum.

 

Please refer to Annex B for the detailed computation of the SMA interest rate.

  

 

Interest rate for Retirement Account

 

The RA interest rate will be maintained at 4% per annum from 1 January 2019 to 31 December 2019, as announced on 27 September 2018.

 

Please refer to Annex C for the detailed computation of the RA interest rate.

  

 

2019 Basic Healthcare Sum

 

The Basic Healthcare Sum (BHS) is the estimated savings required for basic subsidised healthcare needs in old age. The BHS is adjusted yearly for members below age 65 to keep pace with the growth in MediSave withdrawals. Once members reach age 65, their BHS will be fixed for the rest of their lives.

 

From 1 January 2019,

  1. For members below 65 years old, their BHS will be raised from $54,500 to $57,200.
  2. For members who turn 65 years old in 2019, their BHS will be fixed at $57,200, which will not change for the rest of their lives.

For members aged 66 and above in 2019, their cohort BHS had already been fixed and will remain unchanged.

 

Please refer to Annex D for the BHS for respective cohorts.

 

BHS is the cap to the MediSave Account (MA) and contributions in excess of a member’s BHS will be automatically transferred to his or her other CPF accounts. A higher BHS will allow for more savings to be kept in a member’s MA for his or her healthcare needs. CPF members do not have to top up their MA if they have less than the BHS.

  

 

Public enquiries

 

CPF members can visit cpf.gov.sg or call the CPF Call Centre at 1800-227-1188 for enquiries.

 

Annex A

 

Computation of CPF OA interest rate and HDB mortgage rate for 1 January 2019 to 31 March 2019

 

The interest rate on OA monies is adjusted quarterly. OA monies earn either the legislated minimum interest of 2.5% per annum, or the 3-month average of major local banks’ interest rates, whichever is higher.

 

Average banks' interest rate from August 2018 to October 2018
0.40% (see note)
CPF OA interest rate for January 2019 to March 2019 2.50% per annum
(legislated minimum rate)
Plus: Fee to cover Cost of Loan Administration 0.10%
HDB mortgage rate for January 2019 to March 2019 2.60% per annum

Note:

 

  12-MONTH DEPOSIT RATE
(% per annum)
SAVINGS RATE
(% per annum)
AVERAGE
(% per annum)
MONTH/
YEAR
DBS1 OCBC2 UOB3 DBS4 OCBC5 UOB6 Using the 80FD:20SD formula
31 Aug 2018 0.8000 0.2500 0.4000 0.0500 0.0500 0.0500 0.3967
30 Sep 2018 0.8000 0.2500 0.4000 0.0500 0.0500 0.0500 0.3967
31 Oct 2018 0.8000 0.2500 0.4000 0.0500 0.0500 0.0500 0.3967


(1) Balances > $20,000 to $50,000

(2) Balances > $20,000 to $50,000

(3) Balances < $50,000

(4) Balances > $10,000 to $100,000 (AUTO-SAVE Account)

(5) Balances ≤ $100,000 (EASI-SAVE Account)

(6) Balances > $15,000 to $100,000 (UNIPLUS Account)

 

Annex B

 

Computation of CPF SMA interest rate for 1 January 2019 to 31 March 2019

 

The interest rate on SMA monies is adjusted quarterly. SMA monies earn either the current floor interest rate of 4% per annum or the 12-month average yield of 10-year Singapore Government Securities (10YSGS) plus 1%, whichever is higher.

 

Average yield of 10YSGS from November 2017 to October 2018 2.38% (see note)
Plus: 1.00% 1.00%
Computed CPF SMA interest rate for January 2019 to March 2019 3.38%
CPF SMA interest rate for January 2019 to March 2019 4.00% per annum
(current floor rate)

 

 

 

Note:

10-year Singapore Government Securities yields from November 2017 to October 2018

Source: Yields of 10-Year Singapore Government Securities are obtained from www.mas.gov.sg/bonds-and-bills

 

 

 

Annex C

 

Computation of CPF RA interest rate for 1 January 2019 to 31 December 2019

 

RA monies credited in 2019 will be invested in newly-issued Special Singapore Government Securities (SSGS) which will earn a fixed coupon rate equal to either the 12-month average yield of the 10YSGS plus 1% computed for the year, or the current floor rate of 4% per annum, whichever is higher.

 

The average yield of the 10YSGS plus 1% from November 2017 to October 2018 is 3.38% per annum. As this is below the current floor rate of 4% per annum, new SSGS issued in the year of 2019 will pay a fixed coupon of 4%.

 

The interest rate earned by RA monies is the weighted average interest rate of the entire portfolio of these SSGS, which is adjusted in January each year to take into account the coupon rates payable by the new SSGS issuance.

 

 

 

Annex D

 

 

Summary of BHS for respective cohorts

 

The prevailing BHS will be set at $57,200 from 1 January 2019 onwards. This applies to all CPF members aged 65 and below in 2019.

 

For cohorts who turn 65 in 2019 or before, their cohort BHS is fixed for life. The following summarises the BHS for respective cohorts age 65 and above in 2019:

 

Age in 2019 Year where cohort turned age 65 Cohort BHS (fixed for life)
65 2019 $57,200
66 2018 $54,500
67 2017 $52,000
68 and above 2016 or earlier $49,800