Your Complete Guide to CPF Interest Rates

CPF interest rates apply to every employed Singaporean or PR citizen, whether they are salaried or self-employed.

It’s important to know how your CPF interest rates are calculated because after over 30 - 40 years of contributing, your CPF balance would compound into quite a tidy nest egg.

Additionally, knowing how your CPF interest rates work helps you to maximise your benefits and make informed financial decisions. To help you understand how CPF interest rates work, we’ll have a few scenarios with sample calculations.

How do CPF interest rates work?

Every Singaporean has or will have 4 CPF accounts: Ordinary Account (OA), Special Account (SA), MediSave Account (MA), Retirement Account (opened when contributor reaches 55 years old, RA).

Each month, your CPF contribution is allocated according to different allocation rates to the various CPF accounts, depending on your age:  

Your CPF accounts also have varying interest rates per annum which are not fixed but have minimums which you can find here.

Here’s how your CPF accounts’ interest rates are calculated:

Extra Interest

To help enhance the retirement savings of Singaporeans, the Government pays extra interest on the first $60,000 of your combined balances (capped at $20,000 for Ordinary Account (OA)), in addition to the interest rates above.

The first $60,000 of your combined balances is taken from the various accounts in the following sequence:

• 1st: Retirement Account (RA), including any CPF LIFE premium balance
• 2nd: OA, with a cap of $20,000
• 3rd: Special Account (SA)
• 4th: MediSave Account (MA)

If you’re below 55 years old, there’s an extra interest of 1.0% per annum on the first $60,000 of the combined CPF balances (capped at $20,000 from OA). The extra interest earned on your SA and MA balances will go to the respective accounts, while the extra interest earned on your OA balances will go into your SA to enhance your retirement savings.

For example, if you have the following balances:

• $40,000 in your OA;
• $10,000 in your SA; and 
• $10,000 in your MA;

you won’t enjoy the extra interest rate of 1.0% on the full $60,000 combined balance. Because of the $20,000 cap on your OA, in this scenario, you’ll only receive the extra interest on $40,000 ($20,000 from OA + $10,000 from SA + $10,000 from MA).

Here’s a table to help show you this breakdown:

For those who are above 55 years old, contributors would gain extra interest of 2.0% on the first $30,000 and 1.0% on the next $30,000 (capped at $20,000 for OA). The extra interest earned on your RA, SA and MA balances will go to the respective accounts, while the extra interest earned on your OA balances will go into your RA to enhance your retirement savings.

For example, say you had

• $10,000 in your RA;
• $54,000 in your OA;
• $10,000 in your SA;
• $10,000 in your MA. 

You’ll receive extra interest of 2.0% on $10,000 in your RA, $20,000 in your OA. Thus, you’ll receive extra interest of 2.0% on $30,000.

On top of that, there’s the 1.0% additional extra interest enjoyed by those 55 and above on your next $30,000. So, you’ll receive 1.0% additional extra interest on $10,000 in your SA and $10,000 in your MA. In total, you’ll receive additional extra interest of 1.0% on $20,000 even though you have more than $30,000 in combined CPF savings as there’s the $20,000 cap for OA.

Here’s a table to illustrate the situation for those aged 55 years and above: