View Single Post
Old 26-03-2019, 06:17 PM   #1127
Supremacy Member
lingalong's Avatar
Join Date: Oct 2009
Posts: 6,166
Thank you BBC, it was quite an in depth read that took me awhile to process lol.

I sort of get where you're coming from, but let me try break it down into bite size for clarification and for someone else to digest it for their own use.

Scenario: Taking HDB Loan of 2.6%, and before picking up the keys to unit

1) Take full advantage of the 4% that SA is offering, by transferring balance after subtracting $20,000 to SA, thereby drawing 4% which is >2.5% from OA and >2.6% mortgage loan so net net I am 'gaining' the difference in interest.

2) Another alternative instead of 1) is to use CPFIS OA to purchase a low cost index fund that ideally (and hopefully) would return an annualise gain of >2.5% from leaving it in OA, as well as >2.6% mortgage loan.

Both of the above would thereby leave loan servicing of 2.6% to be largely or entirely made up of hard cash so as to not rid the opportunity cost of earning what 1) and 2) could be offering.

Up till now, am I on the right track?
Kopi-O Gao, Siew Tai!

Last edited by lingalong; 26-03-2019 at 06:20 PM..
lingalong is offline   Reply With Quote