CPF Easy Info Thread. :)

[Earnasyougrow]

Walked into the lion's den to get the answer. So this is what happens:

1. On your 55th birthday, SA plus OA will go to RA. If RA is short of FRS, nothing will happen until....

2. 9 months before your 65th birthday, Board will look at each individual member's accounts again. This will be the 2nd pull transaction. SA will again be emptied into RA.

3. If RA still has a shortfall after step 2, then Board will write to the member to decide what he wants to do with his OA. This is because member may still be using OA for mortgage reasons or whatever.

I think I tio marked liao...

Sorry, so from what u written mean "Iceberg" hack is workable? We are able to draw SA out for investment and pull OA into RA for the 4%?

 

[RoLanTo]

Think you left out mentioning SA specifically somewhere, other than that this has been discussed before and looks promising, besides the fact you can't empty out your SA through investments. You need to keep at least $40k in SA. See "How much CPF savings can I invest?" in https://www.cpf.gov.sg/Members/Schemes/schemes/optimising-my-cpf/cpf-investment-schemes

opps.. din realise still tio jiak 40k.. but nvm.. hope the 40k wont keep increasing in tandem.. then its ok

 

[RoLanTo]

Let's say I were to invest most of my SA but keep the requisite 40k in SA but I only have 120k in OA

When I'm 55, RA will have 40+120k which is still 6k short of FRS.

What happens when my investment matures and I have 200k going back to my SA account ?

Will CPF refund the 120k back to my OA and take out 126k from SA ? Or will CPF just take out 6k from SA ?

I'm really hoping for many free lunches here...

key thing is
OA+SA(40k since no choice) must equal or exceed FRS.. then can sui sui

 

[RoLanTo]

Firstly, you can't empty your SA as you need to leave behind 40k.

Secondly, post 55 SA earns normal 4% and not 4.5%.

Ok. 4 or 4.5% not big diff.. still better then FD in bank when im age 55 and want risk free money..

not 100% risk free... cpf policy may change

 

[RoLanTo]

Sorry, so from what u written mean "Iceberg" hack is workable? We are able to draw SA out for investment and pull OA into RA for the 4%?

yes.. u go any CPF roadshow ask any cpf staff, they can answer u this..

just that it may not be very well advertise by them because they think many ppl cannot hit FRS.. at least those folks like my parents generation..

but i believe younger one can.. so they may cover this gap in future.. probably? i dont know

 

[bladez87]

Walked into the lion's den to get the answer. So this is what happens:

1. On your 55th birthday, SA plus OA will go to RA. If RA is short of FRS, nothing will happen until....

2. 9 months before your 65th birthday, Board will look at each individual member's accounts again. This will be the 2nd pull transaction. SA will again be emptied into RA.

3. If RA still has a shortfall after step 2, then Board will write to the member to decide what he wants to do with his OA. This is because member may still be using OA for mortgage reasons or whatever.

I think I tio marked liao...

Bro paiseh ah, what happens if your funds are emptied into RA? Are RA funds only meant for CPF life and the monthly withdrawal after 65? or can they be withdrawn like OA at any time?

The idea of using SA to buy Tbonds is to prevent SA from transferring to RA at 55, to force OA to be flush into RA, so that we gain RA 4% interest instead of OA 2.5%. Then when SA come back, it will also get 4% interest? Is the flushing of funds at 55 capped at BRS/FRS or just whole account transfer?

Btw which CPF branch you went to?

Thanks

 

[elnewbie]

RA funds are only meant for CPF life. You can't suka suka withdraw.

I called them.

Bro paiseh ah, what happens if your funds are emptied into RA? Are RA funds only meant for CPF life and the monthly withdrawal after 65? or can they be withdrawn like OA at any time?

Btw which CPF branch you went to?

Thanks

 

[bladez87]

Assuming your MC is 1k per month.

The best you can expect is they ignore your VC completely and calculate interest on your monthly MC. At end of year, they total your MC and recognise the difference between annual limit and total MC to derive the allowable VC and calculate interest on the allowable VC from Jan.

At worst the allowable VC is eventually recognised in Dec and no interest in Dec. Amount in excess of allowable VC will be refunded the following year.

Ya. That best case amounts to 1k+ per year in interest! Done over 20 years = 20k excluding compounding effect

 

[maple96]

Bro paiseh ah, what happens if your funds are emptied into RA? Are RA funds only meant for CPF life and the monthly withdrawal after 65? or can they be withdrawn like OA at any time?


Thanks

RA funds = at 65 payout date, u can withdraw up to 20% of RA (excluding topups).

If u apply for BRS, u can withdraw amounts above BRS.

 

[maple96]

Walked into the lion's den to get the answer. So this is what happens:

1. On your 55th birthday, SA plus OA will go to RA. If RA is short of FRS, nothing will happen until....

2. 9 months before your 65th birthday, Board will look at each individual member's accounts again. This will be the 2nd pull transaction. SA will again be emptied into RA.

3. If RA still has a shortfall after step 2, then Board will write to the member to decide what he wants to do with his OA. This is because member may still be using OA for mortgage reasons or whatever.

I think I tio marked liao...

Your q&a above with CPF Board did not address CPFIS/SA investment?

How is SA balance determined at 55? SA account balance plus CPFIS/SA balance?

CPF uses SA account balance plus CPFIS SA balance to determine how much u can transfer from OA to SA before 55. So I guess (u should ask CPF to confirm) at 55, FRS is determined using the same formula.

If SA plus CPFIS/SA is more than FRS, will CPF take it as insufficient FRS for transfer to RA at 55, then wait till 65 when u liquidate your CPFIS/SA to do the transfer. If at 65 u still do not liquidate your CPFIS/SA, then CPF will ask u to liquidate to join CPF Life?

Current CPF rules are ambiguous when it state CPFIS/SA liquidated after 55 will return to CPF Accounts, it did not say return to SA, so CPF can interpret as they think when it comes?

 

[crimsontactics]

RA funds = at 65 payout date, u can withdraw up to 20% of RA (excluding topups).

If u apply for BRS, u can withdraw amounts above BRS.

I didn't know RA can withdraw 20%! :O

Sent from OPPO F1s using GAGT

 

[RoLanTo]

Your q&a above with CPF Board did not address CPFIS/SA investment?

Current CPF rules are ambiguous when it state CPFIS/SA liquidated after 55 will return to CPF Accounts, it did not say return to SA, so CPF can interpret as they think when it comes?

i found this
https://www.cpf.gov.sg/Members//Faq/schemes/optimising-my-cpf/cpf-investment-schemes#faq16676


Q

What happens when I sell my investments under CPF Investment Scheme (CPFIS)?

when u sell SA investment product, it goes back to SA... since age 55 n above u will still have SA account.. it flow back there..

 

[tmkedmw]

I didn't know RA can withdraw 20%! :O

Sent from OPPO F1s using GAGT

Born in 1958 or after, 20% of RA
Born in 1957 or earlier, 10% of RA

From payout eligibility age:

For members who turned 55 from 2013 (i.e. born in 1958 or after), you also have the option to withdraw a lump sum of up to 20% of the savings in your Retirement Account at your payout eligibility age (includes the first $5,000 you can withdraw at 55).

For members who turned 55 in 2012 (i.e. born in 1957), you can already withdraw up to 10% of your Ordinary and Special Accounts when you turned 55. Hence, you will have the option to withdraw a lump sum of up to 10% of the savings in your Retirement Account at your payout eligibility age.

 

[kehyi4]

For those wondering what happens to VC-MA if you exceed CPF Annual Limit, the simply answer is:

CPF will refund the VC-MA in excess of CPF AL and claw back the interest

Proof (my own CPF statement):

I made VC-MA throughout last year, but exceeded CPF AL for the whole year. CPF simply refunded the excess VC-MA (code RFD) and clawed back the interest (code ADJ). Note that they did this in early Feb the following year. Note also that they refunded in reverse order, refunding for Aug, Sep, Oct and Dec, but left my earlier VC-MAs intact

 

[bladez87]

Wow. How come the interest refund is more than 1%

 

[henrylbh]

Wow. How come the interest refund is more than 1%

Your comprehension poor
or your never read?

 

[bladez87]

Your comprehension poor
or your never read?

care to elaborate more?

aug sep oct refund 1254.32
interest clawback 12.58 ; 1%
i am going to maths the hell out of this.

 

[apatheticme]

For those wondering what happens to VC-MA if you exceed CPF Annual Limit, the simply answer is:

CPF will refund the VC-MA in excess of CPF AL and claw back the interest

Proof (my own CPF statement):

I made VC-MA throughout last year, but exceeded CPF AL for the whole year. CPF simply refunded the excess VC-MA (code RFD) and clawed back the interest (code ADJ). Note that they did this in early Feb the following year. Note also that they refunded in reverse order, refunding for Aug, Sep, Oct and Dec, but left my earlier VC-MAs intact

Thanks for this. I was going to ask ASSI what does it look like in the statement now I don't have to. Seems like they chose an obtuse way to do it, but what do I know, I'm not an accountant.

 

[henrylbh]

care to elaborate more?

aug sep oct refund 1254.32
interest clawback 12.58 ; 1%
i am going to maths the hell out of this.

Have you figure out what the hell is going on with the refund and interest?

My maths poor.

Dunno how the overpayment is arrived at as there is no detail.

But for interest, my guess, it's interest for 4 months, 3 months and 2 months respectively

 

[apatheticme]

Have you figure out what the hell is going on with the refund and interest?

My maths poor.

Dunno how the overpayment is arrived at as there is no detail.

But for interest, my guess, it's interest for 4 months, 3 months and 2 months respectively

monthlyinterestrate:	0.04/12=	0.003333333
VC-MA	months	$$
432.83	4	5.771066667
401.69	3	4.0169
419.8	2	2.798666667
1096.68	0	0

1 cent off for AUG amount, but close enough for me. I wonder how is overflow handled in case of refund though...

edit: also, since refund is done in feb, what happened to the january interests? such a ridiculous way of doing this. I don't even.

I am also wondering if kehyi topped up in these funny numbers just to be able to reverse engineer the calculations