CPF MediSave Investment Scheme Singapore: How to Invest Your MediSave Funds
The CPF MediSave Investment Scheme (MSIS) allows Singapore CPF members to invest a portion of their MediSave Account (MA) savings — beyond the Basic MediSave Sum — in approved investment products including unit trusts and endowment plans. This is a less well-known counterpart to the CPF Investment Scheme (CPFIS) that applies to OA funds.
Not financial advice. All figures for educational reference only. Data as at May 2026.
Last updated: May 2026
Key Takeaways
- The MediSave Investment Scheme (MSIS) allows investment of MediSave balances above the Basic MediSave Sum (BMS), which is S$49,800 in 2026.
- Only approved products are eligible — currently limited to certain insurance savings plans (endowment products) from approved insurers.
- Unlike CPFIS (OA), the MSIS product list is narrow; equities and ETFs are NOT eligible under MSIS.
- MediSave funds earn a guaranteed 4% p.a. — any MSIS investment must beat this hurdle to be worthwhile.
- Most Singaporeans find MSIS less attractive than CPFIS because the eligible product list is limited and the 4% guaranteed return is high.
What Is the CPF MediSave Investment Scheme?
The CPF MediSave Investment Scheme (MSIS) is a government-approved programme that allows CPF members to invest MediSave Account balances above the Basic MediSave Sum (BMS) in selected products. It was designed to give members with large MediSave balances — who are unlikely to use all of their MediSave for healthcare before death — a way to potentially earn more than the 4% guaranteed rate.
The scheme is significantly more restricted than the CPF Investment Scheme (CPFIS) which applies to OA funds. Under CPFIS, members can invest in unit trusts, ETFs, bonds, and shares. Under MSIS, only approved insurance savings products (endowment plans) are eligible. Equities, ETFs, and REITs are not available through MSIS.
How the CPF MediSave Investment Scheme Works in Singapore
| Parameter | Details (2026) |
|---|---|
| Eligible balance | MA balance above the Basic MediSave Sum (BMS) of S$49,800 |
| Eligible products | Approved insurance savings plans (endowment) from MAS-approved insurers |
| Products NOT eligible | Equities, ETFs, unit trusts, REITs, T-bills, SSBs, fixed deposits |
| MediSave floor interest | 4% p.a. (guaranteed) — investment must outperform this |
| Redemption | Subject to product terms (typically 5–10 year endowment plans) |
| Age eligibility | All CPF members with MA above BMS |
Source: CPF Board, 2026.
MSIS Example for Singapore Investors
A 45-year-old Singaporean has S$80,000 in her MediSave Account. The BMS in 2026 is S$49,800. She is eligible to invest up to S$30,200 (S$80,000 − S$49,800) under MSIS. She considers an approved endowment plan from an insurance company offering a projected return of 4.5–5.0% p.a. over 10 years. The projected return exceeds the 4% MediSave guaranteed rate — but the projected return is not guaranteed (only a minimum benefit is guaranteed). After evaluating the surrender value terms and comparing with leaving funds in MediSave at 4% guaranteed, she decides the marginal expected benefit does not justify the illiquidity risk.
Advantages of MSIS
Potential to beat 4% MA rate. Selected endowment plans from insurers can deliver projected returns of 4.5–5.0% p.a. over 10+ years — though non-guaranteed bonuses drive the upside.
Forces long-term savings discipline. For members who might otherwise hold excess MediSave in a liquid account, MSIS encourages commitment to a longer-term savings vehicle.
Risks and Limitations
Narrow product range. The MSIS-approved product list is very limited — essentially restricted to participating endowment policies. This contrasts sharply with CPFIS which offers hundreds of unit trusts and ETFs.
Non-guaranteed upside. The projected returns of endowment plans include non-guaranteed bonuses. The guaranteed portion may not exceed the 4% MediSave rate.
Illiquidity risk. Endowment plans have surrender charges in early years — exiting early results in losses. If you need your MediSave for healthcare costs during the policy term, you may face forced early surrenders.
Healthcare cost risk. If you invest MediSave funds and then face large unexpected healthcare bills, you may not have sufficient MediSave liquid balance — requiring cash payment for medical costs.
MSIS vs CPFIS Comparison
| Feature | MSIS (MediSave) | CPFIS-OA (Ordinary Account) |
|---|---|---|
| Source of funds | MediSave Account | Ordinary Account |
| Guaranteed base rate | 4% p.a. | 2.5% p.a. |
| Eligible products | Endowment plans only | Unit trusts, ETFs, shares, bonds, REITs |
| Return potential | Low-medium (endowment) | Higher (equities/REITs) |
| Liquidity | Low (policy terms) | Medium (can sell most investments) |
| Hurdle to beat | High (4%) | Lower (2.5%) |
The Bottom Line
For most Singapore investors, the CPF MediSave Investment Scheme offers limited appeal compared to CPFIS-OA. The 4% guaranteed MediSave rate is already excellent, the eligible product list is narrow, and the liquidity risk of tying up healthcare funds in long-term endowment plans is significant. Unless you have a very large MediSave balance well above the BMS and high confidence in your healthcare cost projections, leaving MediSave funds earning 4% is the safer and simpler choice. For investment flexibility, focus on CPFIS with your OA funds instead.