I just topped up my CPF Medical Account (MA) with $3,500 in cash, bringing my balance to the Basic Health Sum (BHS) of $79,000 today, 1 January 2026. Topping up my MA to the BHS at the beginning of each year is beneficial for both tax relief and earning a risk-free 4% annual return.
While it may appear that your MA remains unchanged at the BHS throughout the year, the CPF Board credits 4% interest per annum, which is announced and applied on the last day of the year to your OA, SA (not applicable to CPF members above 55), MA, and RA (not applicable to members below 55). Once the BHS limit is reached, any interest earned on your MA is transferred to your OA.
For CPF members over 55, using cash to top up their MA to
the BHS is particularly advantageous, as they have the flexibility to withdraw
from their OA when cash is needed. If their liquid funds are limited,
withdrawing money from their OA (which earns 2.5% p.a.) and topping up the MA
(which earns 4% p.a.) still yields an additional 1.5% annual return, making it
a solid second-best option.
Prescientsuper
https://superphang.blogspot.com
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