In the CPF, there are three accounts, namely the Ordinary Account (OA), Medisave Account (MA) and the Special Account (SA). Annual interest rates of the OA, MA and SA are 2.5%, 4% and 4% respectively. Today’s post would be focused on the Medisave Account.
Don’t get misled by the title. There really are three accounts, and the Medisave Account isn’t going to be combined with the Special Account anytime soon.
However, I would like to highlight a feature of the Medisave Account which makes it special. In fact, more special than the Special Account if you have not hit your FRS (Full Retirement Sum).
Did you know that the Medisave Account has a ceiling of $52,000 as of today? Ah ha! I bet you didn’t! It is the only account out of the three that has a ceiling. This ceiling is known as the Basic Healthcare Sum (BHS). It increases annually due to inflation and rising healthcare costs. BHS is useful for us to create wealth using the CPF.
Hear this – Once your MA has reached the BHS, the magic happens. Continue reading “Medisave Account is also a Special Account”