Based on the latest recent release by CPF Board and HDB Board, it is note that CPF Members can continue to earn up to 2.5% in interest rates from their Ordinary Accounts and up to 5% in their Specila and Medisave Accounts in the 2nd quarter of 2020. Interest rates will be paid an extra 1% for the 1st $60,000 of a citizen’s CPF account in an effort by the government to improve the CPF Savings of its members. Many note that the returns of CPF are higher than property returns over the long term. Please see the latest investment decision and project details for Midtown Gardens. Midtown Gardens project details by Guocoland can be found here.
There will be also higher interest earned for members above 55 years of to enhance their CPF savings as this is to acertain their contribution to nation building. This is paid over and above the current extra 1% interest that is earned on the first $60,000 of their combined balances. The extra interest will go to the SA account to prepare members for their retirement.For a member who is above 55 years old and participates in the CPF LIFE scheme, the extra interest accumulated will still be earned on balances, which includes the savings used for CPF LIFE till date.
It is interesting in the sense that the OA interest rate is kept at 2.5% and this did not increase comparatively to what analyst has anticipated as the OA rates normally match with SA rates. HDB loans are still pegged to the standard 2.6% interest rate though.
The Special and Medisave interest rate will be maintained at 4% per annum from 1 April 2020 to 30 June 2020, as the computed rate of 2.91% is lower than the current interest rate floor of 4% per annum. It is note that SA accounts tend to have the highest interest rates.