CPF Retirement Sum Scheme

[sohguanh]

this is a good method to get the oa money out. do you know how many times we can open and close the investment account?

I am also keen to know this is applicable for ppl before age 55? If can it is a loophole to change my OA money into cold hard cash where I can touch instead of smell previously. Hope readers who have successfully taken this route share their experience.

 

[anddrool]

I don't get the idea of using OA to invest, transfer to CDP close CPF investment account.
Based on CPF FAQ, the person need to reach 55 years old and set aside FRS in RA.

If a person has FRS in RA, he can just withdraw the OA directly from CPF.
Why is there a need to invest CPF OA, transfer to CDP and close CPF investment account, just to get the OA money.

How do I transfer my shares, bought under CPF Investment Scheme (CPFIS), to my Central Depository account?

You may apply to close your CPF Investment Account and transfer your shares to your own Central Depository account after you have reached 55 years old and have set aside your Full Retirement Sum (FRS) in the Retirement Account (RA). The FRS can be set aside fully with cash, or with cash (i.e. at least the Basic Retirement Sum) and property.
Please refer to this FAQ for more information on how the retirement sum is set aside at age 55.

To apply for closure of CPF Investment Account, please submit an e-application to us.

 

[reddevil0728]

I don't get the idea of using OA to invest, transfer to CDP close CPF investment account.
Based on CPF FAQ, the person need to reach 55 years old and set aside FRS in RA.

If a person has FRS in RA, he can just withdraw the OA directly from CPF.
Why is there a need to invest CPF OA, transfer to CDP and close CPF investment account, just to get the OA money.

How do I transfer my shares, bought under CPF Investment Scheme (CPFIS), to my Central Depository account?

You may apply to close your CPF Investment Account and transfer your shares to your own Central Depository account after you have reached 55 years old and have set aside your Full Retirement Sum (FRS) in the Retirement Account (RA). The FRS can be set aside fully with cash, or with cash (i.e. at least the Basic Retirement Sum) and property.
Please refer to this FAQ for more information on how the retirement sum is set aside at age 55.

To apply for closure of CPF Investment Account, please submit an e-application to us.

If you got money in SA, withdrawal will come from there first. And that’s 4%.

so need to find alternate means to get the 2.5% out of OA first

 

[dork32]

I am also keen to know this is applicable for ppl before age 55? If can it is a loophole to change my OA money into cold hard cash where I can touch instead of smell previously. Hope readers who have successfully taken this route share their experience.

this one confirm first time can. it is indicated in the cpf website. after that can we still do it? it is a question mark.

 

[dork32]

There are 3 banks that offer CPF Investment Accounts. It seems like at least 3 times would be possible — at least once with each bank.

if the investment account is controlled by the bank, it would at least 3 times. but if the investment account is controlled by cpf then it could be only once.

if it is only once, then you have to use your one joker card very wisely.

 

[anddrool]

If you got money in SA, withdrawal will come from there first. And that’s 4%.

so need to find alternate means to get the 2.5% out of OA first

i see.
In that case, why not withdraw the SA(excess of FRS) + available OA money out directly from CPF.
Then keep whatever money needed.
Use the reminder cash to Top up back to CPF RA.

Isn't the end result is the same.

 

[reddevil0728]

i see.
In that case, why not withdraw the SA(excess of FRS) + available OA money out directly from CPF.
Then keep whatever money needed.
Use the reminder cash to Top up back to CPF RA.

Isn't the end result is the same.

Cause they are like a risk free bank account? Earning 4%?
And some dun want to top up RA? If on cpf life the interest will not be part of your bequest

 

[dork32]

i see.
In that case, why not withdraw the SA(excess of FRS) + available OA money out directly from CPF.
Then keep whatever money needed.
Use the reminder cash to Top up back to CPF RA.

Isn't the end result is the same.

lets say i have 200k sa, 200 oa and 0 cash

i want to buy car at 100k.

i can withdraw 100k from my sa to my car to leave me with 100k sa and 200k oa + 1 car
or
i can buy 3300 dbs shares using oa, close the investment account. 3300 dbs shares get transferred to cdp. sell my 3300 dbs shares using dbs vickers. use the proceeds to buy my car.
in this way, i have 200k sa + 100k oa + 1 car

given a choice, understood use oa to buy car. only gong kia will use sa unless no choice

 

[anddrool]

Cause they are like a risk free bank account? Earning 4%?
And some dun want to top up RA? If on cpf life the interest will not be part of your bequest

My point is if the main reason of investing using OA, transfer to CDP and close account is just to withdraw only the OA portion and leave RA potion untouch (to earn 4%).

The person can simply just withdraw the SA(excess of FRS) + available OA money out directly from CPF.
Then keep whatever money needed.
Use the reminder cash to Top up back to CPF RA to earn 4%

The end result is the same. And this is so much simpler.

 

[dork32]

My point is if the main reason of investing using OA, transfer to CDP and close account is just to withdraw only the OA portion and leave RA potion untouch (to earn 4%).

The person can simply just withdraw the SA(excess of FRS) + available OA money out directly from CPF.
Then keep whatever money needed.
Use the reminder cash to Top up back to CPF RA to earn 4%

The end result is the same. And this is so much simpler.

1. it is sa and not ra
2. you cannot happy happy top up sa
3 you cannot happy happy withdraw from ra
4. i want my money in sa. i dont want my money in ra.
5. my ra is so big that i cannot top up any more

 

[anddrool]

lets say i have 200k sa, 200 oa and 0 cash

i want to buy car at 100k.

i can withdraw 100k from my sa to my car to leave me with 100k sa and 200k oa + 1 car
or
i can buy 3300 dbs shares using oa, close the investment account. 3300 dbs shares get transferred to cdp. sell my 3300 dbs shares using dbs vickers. use the proceeds to buy my car.
in this way, i have 200k sa + 100k oa + 1 car

given a choice, understood use oa to buy car. only gong kia will use sa unless no choice

Why can't the person withdraw $200k ($100k from SA and $100k from OA)
Use $100k to buy Car.
Top up $100k back to RA (To earn back the 4%)

Why can't the person do this instead?

 

[Froggyman]

My point is if the main reason of investing using OA, transfer to CDP and close account is just to withdraw only the OA portion and leave RA potion untouch (to earn 4%).

The person can simply just withdraw the SA(excess of FRS) + available OA money out directly from CPF.
Then keep whatever money needed.
Use the reminder cash to Top up back to CPF RA to earn 4%

The end result is the same. And this is so much simpler.

End result is same same but different .
You can anytime withdraw $ from SA but not RA ( having full FRS in RA) , so most of the people prefer to leave the $ inside SA

 

[bargin]

Hi @BBCWatcher,
Have met the FRS (pledge with property) and wan to do voluntary housing refund by withdrawing funds from SA ($5k). the $5k will reduce the principal in housing as well the amount in the property pledge, thus will increase the RA amount. Is this a wise method ? Age above 55 but under 65. No need to consider tax relief.

 

[dork32]

Hi @BBCWatcher,
Have met the FRS (pledge with property) and wan to do voluntary housing refund by withdrawing funds from SA ($5k). the $5k will reduce the principal in housing as well the amount in the property pledge, thus will increase the RA amount. Is this a wise method ? Age above 55 but under 65. No need to consider tax relief.

i really dont know what to say. it really takes all types to make this world

 

[a4973]

Hi @BBCWatcher,
Have met the FRS (pledge with property) and wan to do voluntary housing refund by withdrawing funds from SA ($5k). the $5k will reduce the principal in housing as well the amount in the property pledge, thus will increase the RA amount. Is this a wise method ? Age above 55 but under 65. No need to consider tax relief.

This sounds complicated, would like to understand more. Able to illustrate with numbers? Thanks.

 

[reddevil0728]

Hi @BBCWatcher,
Have met the FRS (pledge with property) and wan to do voluntary housing refund by withdrawing funds from SA ($5k). the $5k will reduce the principal in housing as well the amount in the property pledge, thus will increase the RA amount. Is this a wise method ? Age above 55 but under 65. No need to consider tax relief.

Withdraw a 4% to pay back a 2.5%?
Also how will it increase the ra amount?

 

[BBCWatcher]

Hi @BBCWatcher,
Have met the FRS (pledge with property) and wan to do voluntary housing refund by withdrawing funds from SA ($5k). the $5k will reduce the principal in housing as well the amount in the property pledge, thus will increase the RA amount. Is this a wise method ? Age above 55 but under 65. No need to consider tax relief.

So you want to withdraw dollars that are currently earning 4.0% interest, that you can withdraw at any time, in order to deposit them in an account that earns 2.5% interest and that you cannot easily withdraw (except after you withdraw your 4.0% interest earning dollars)?

i really dont know what to say. it really takes all types to make this world

It's an "interesting" idea.

 

[anddrool]

End result is same same but different .
You can anytime withdraw $ from SA but not RA ( having full FRS in RA) , so most of the people prefer to leave the $ inside SA

In order for the "CPF OA investment hack" to work, the person need to be at least 55 years old and have FRS in RA. This is the requirement to transfer CPF investment to CDP.
Or there are some other ways that I missed out.

If the sole purpose is just to get CPF OA money, then I think it is simpler and faster to just withdraw directly from CPF and top up back to RA.
However if the person does not want to change the "Available CPF balance to withdraw" amount, the person cannot withdraw directly from CPF and top up back to RA.

For example, before withdrawing "Available CPF balance to withdraw" is $100k.
The person withdraw $100k from CPF. "Available CPF balance to withdraw" = 0 after withdrawal.
Then the person top up $100K via RSTU to RA. After top up, "Available CPF balance to withdraw" will be still $0.
Because RSTU top up cannot be withdrawal.

I think this will be the main downside(which I think is very important to consider) for withdrawing directly from CPF.
If the person is concern about this. Then he has to do the long way by using the "CPF OA investment hack".

 

[reddevil0728]

In order for the "CPF OA investment hack" to work, the person need to be at least 55 years old and have FRS in RA. This is the requirement to transfer CPF investment to CDP.
Or there are some other ways that I missed out.

If the sole purpose is just to get CPF OA money, then I think it is simpler and faster to just withdraw directly from CPF and top up back to RA.
However if the person does not want to change the "Available CPF balance to withdraw" amount, the person cannot withdraw directly from CPF and top up back to RA.

For example, before withdrawing "Available CPF balance to withdraw" is $100k.
The person withdraw $100k from CPF. "Available CPF balance to withdraw" = 0 after withdrawal.
Then the person top up $100K via RSTU to RA. After top up, "Available CPF balance to withdraw" will be still $0.
Because RSTU top up cannot be withdrawal.

I think this will be the main downside(which I think is very important to consider) for withdrawing directly from CPF.
If the person is concern about this. Then he has to do the long way by using the "CPF OA investment hack".

Don’t get why you keep talking about top up RA?

what if people don’t want to increase their RA balance anymore than they need to?

 

[dork32]

Don’t get why you keep talking about top up RA?

what if people don’t want to increase their RA balance anymore than they need to?

some people just dont get it.