Latest T-Bills: 4.4% p.a.
CPF-OA Interest Rate: 2.5% p.a.
An additional
1.9% p.a. risk-free interest? It’s a no-brainer to invest!
Source: Giphy
BUT WAIT!
It’s not as simple as you might think.
So, here’s what you need to consider before using your CPF funds to invest in T-bills (or fixed deposits) and how to do it too!
TL;DR: Using CPF Funds to Invest in T-bills Or Fixed Deposits — All You Need to Know
If you fulfill the requirements and have opened your CPFIA, T-bills are currently a great way to invest your CPF-OA funds provided you can lock it up for the full duration of the tenor (typically 6 months). This is because T-bill interest rates are now far above CPF-OA interest rates:
| Recommended cut-off yields of T-bills (assuming a 1-month time lag) |
|
Minimum cut-off yield to use OA to invest |
Minimum cut-off yield to use SA to invest |
| 6-month |
2.92% p.a. |
4.67% p.a. |
| 1-year |
2.71% p.a. |
4.33% p.a. |
Source: DBS, The Straits Times Graphics...
