On 22 September 2026, the government confirmed that our Special, MediSave and Retirement Account (SMRA) savings will keep earning at least 4% a year until the end of 2027.

But should you really be planning your finances assuming that 4% will last forever?

Your SMRA actually doesn't earn a flat 4% by default. It earns whichever is higher between a pegged rate or a floor rate.

The pegged rate is calculated based on the 12-month average yield of 10-year Singapore Government Securities, plus 1 percentage point, recalculated every quarter. When bond yields are strong, this formula can push your SMRA interest rate above 4%. But when yields are weak, like they've been for most of the past two years, the formula falls short.

For October to December 2026, the computed SMRA rate is 3.06%, based on the average yield of 10-year Singapore Government Securities from August 2025 to July 2026.

The difference is that the OA's 2.5% minimum is legislated. Meanwhile, the SMRA's 4% floor is a Government policy that has been extended periodically, with the current extension running only until 31 December 2027.

But to be fair, their track record is excellent. The 4% floor rate has been repeatedly extended since it started in 2008 (usually announced sometime in September, for the year ahead).

Regardless, "renewed every year so far" does not mean "guaranteed forever". So what happens if, in some future year, the renewal doesn't come through?

Your SA and RA won't suddenly earn nothing, don't worry. They'd likely drop to something close to that formula rate, maybe low 3% territory based on where things stand today. Still safe, just less generous than what you've gotten used to.

But, you need to remember that any money you put into your SA or RA through the Retirement Sum Topping-Up Scheme (RSTU), whether cash or a CPF transfer, is irreversible.

So, unlike savings or investments that can be reallocated, you can't simply withdraw those RSTU top-up monies and put it somewhere better. In that case, you could be earning less on cash you already can't touch until payout, with no way to undo the decision.

Something that seems like a mild inconvenience at first may be something worth thinking through before you make your top-ups.

Honestly, there's no single right answer here, everyone's situation is different. But you can use the calculator below to compare what your top-up could grow into if the floor holds at 4%, versus if it eases.

Even in the more cautious scenario, your money is still compounding safely inside CPF. That gap is real over 20 or 30 years, no doubt. Just make sure you're okay not touching this money for the rest of your working life, whichever rate ends up applying.

1. Your emergency fund comes first.
   CPF top-ups are irreversible, so don't move money you may need for unexpected expenses into your SA or RA. That 4% interest may sound attractive, but it doesn't replace having cash you can access when you need it.
   
2. Use the FRS and ERS as reference points, not the default target.
   The amount you can top up depends partly on your age. If you're below 55, cash top-ups to your SA are generally capped by the prevailing Full Retirement Sum (FRS). From 55, you can top up your RA up to the prevailing Enhanced Retirement Sum (ERS).
   
   How far you go is ultimately a personal decision. Consider the monthly retirement payout you want, how much you can comfortably set aside, and how much liquidity you're willing to give up.
   
3. Don't rush topping up just to lock in 4%.
   There's no need to rush a CPF transfer because you're worried about missing out on the 4% floor. The more important question is whether putting more money into CPF makes sense for your own circumstances.
   
   If you're making a qualifying cash top-up, you may also be eligible for tax relief, subject to the applicable rules and annual limits. Transfers between your CPF accounts do not qualify for this tax relief.

The more useful question is not whether 4% looks attractive today. It is whether your retirement plan still works if that floor is lower one day, and whether you are comfortable giving up liquidity in exchange for long-term compounding.

If the same pool of money may also matter for an upgrade, right-sizing move or another retirement decision, model those choices together before locking it away.