Interest rate for CPF Special, Medisave and Retirement accounts dips to 4% in Q1 2025

SINGAPORE: The interest rate for Central Provident Fund (CPF) Special, MediSave and Retirement accounts will dip to 4 per cent per annum in the first quarter of 2025.

This is down from 4.14 per cent in the previous quarter, the first decrease after two consecutive quarterly increases.

The lower interest rate is due to a decrease in the 12-month average yield of 10-year Singapore Government Securities, said the CPF Board, Housing Board (HDB) and the Ministry of Health (MOH) on Wednesday (Dec 11).

Savings in the Special, MediSave and Retirement accounts will earn 4 per cent per annum from Jan 1 to Mar 31, 2025, the joint news release added.

The Ordinary Account (OA) interest rate will remain unchanged at 2.5 per cent for the first quarter of next year.

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 during the same period.  

In line with the government’s efforts to boost retirement savings for CPF members, members will continue to earn extra interest on their CPF savings. 

Those below 55 years old will earn an extra 1 per cent interest on the first S$60,000 (US$44,460) of their combined balances. This interest is capped at S$20,000 for the OA. 

Members aged 55 and above will receive an extra 2 per cent interest on the first S$30,000 of their combined balances, capped at S$20,000 for the OA, and an extra 1 per cent on the next S$30,000. 

The extra interest earned on the OA balances will go into a member’s Special Account or Retirement Account. 

Members who are above 55 years old and participate in the CPF LIFE scheme will still earn the extra interest on their combined CPF balances. This includes the savings used for CPF LIFE.

INCREASE IN BASIC HEALTHCARE SUM

The authorities also announced an increase in the Basic Healthcare Sum (BHS) in 2025.

From Jan 1, CPF members aged below 65 will have their BHS increased from S$71,500 to S$75,500, while those who turn 65 in 2025 will have their BHS fixed at S$75,500 and not change thereafter.

For CPF members aged 66 and above in 2025, their BHS has already been fixed and will remain unchanged, the authorities said.

The BHS is the estimated savings required for basic subsidised healthcare needs in old age. It is adjusted yearly by MOH for those below 65 to keep pace with the growth in MediSave use.

Members can make contributions to the MediSave account up to the BHS. MediSave contributions in excess of a member’s BHS will be automatically transferred to their other CPF accounts.

CPF members who have less than the BHS are not required to top up their MediSave account and will still be able to withdraw from it to pay for approved medical expenses.