Self-employed only required to contribute to their Medisave Account

Self-employed only required to contribute to their Medisave Account

This is to help self-employed CPF members save more for their retirement needs, as interest rates for the Special and Retirement Accounts are higher than the Ordinary Account, says Manpower Minister Lim Swee Say.

SINGAPORE: Self-employed people are only required to contribute to their Medisave Account. Medisave Account contributions in excess of the prevailing Medisave Contribution Ceiling are automatically transferred to a Central Provident Fund (CPF) member’s Special Account if he is below 55 years old, or to his Retirement Account if he is aged 55 and above.

This is to help CPF members save more for their retirement needs, as interest rates for the Special and Retirement Accounts are higher than the Ordinary Account.

Manpower Minister Lim Swee Say, said this in Parliament on Tuesday (Jul 14) in response to a question by MP Lee Bee Wah on how the self-employed, who may not have sufficient savings in CPF to buy a house, can be helped.

Dr Lee also asked if the CPF account holder can prove that he has substantial insurance policies to cover future medical expenses, whether he can be allowed to opt to only contribute to his Ordinary Account.

In response, Mr Lim said Medisave savings can be used to pay the hospitalisation expenses and other healthcare expenses such as outpatient treatment.

In addition, he said MediShield Life offers universal healthcare coverage, unlike other medical insurance policies: "More importantly, his Medisave can also be used to pay for the medical expenses or MediShield Life premiums of his spouse, children, parents and grandparents. Hence, CPF members with comprehensive medical insurance policies are not exempted from contributing to their Medisave."

Source: CNA/ek