CPF Easy Info Thread. :)

[vsvs24]

The CPF Board reportedly changed SA/OA withdrawals. Previously the order of withdrawal (age 55+) was SA interest first, OA interest second, SA principal third, OA principal fourth. Now it's simpler: SA first, OA second. You cannot withdraw from OA until SA (principal and interest) is drained.

However, there's a potential workaround that still exists. If you have at least $21,000+ in your OA you can effectively withdraw the amount above $20,000 by buying a T-bill via the CPF Investment Scheme (OA). Then close your CPF Investment Account and transfer the T-bill to your CDP account. You have to wait about 6 months until your T-bill matures using this pathway, but the T-bill earns some interest. Alternatively if you want to (effectively) withdraw only roughly the OA interest first you could buy a long tenor Singapore Government Security (SGS), close your CPF Investment Account/transfer the bond to your CDP account, and collect the twice annual coupons. Long tenor SGSes are currently also yielding above the OA 2.5% interest rate, so this approach can be a very reasonable one for some people.

I am considering buying 6 mths and 1 year Tbill and close my CPFIS. I am above 55 and RA has FRS sum.

Any idea long long the process takes from the time of application to CPF Board for closure of CPFIS till the securities gets transferred to CDP ?

Is it confirmed that the shares, Tbill and SGS bonds in CPFIS can certainly be transferred to CDP ? What are the charges ?

Thanks.

 

[BBCWatcher]

I am considering buying 6 mths and 1 year Tbill and close my CPFIS. I am above 55 and RA has FRS sum.
Any idea long long the process takes from the time of application to CPF Board for closure of CPFIS till the securities gets transferred to CDP ?

No idea, but it’s handled electronically so probably within a few business days.

Is it confirmed that the shares, Tbill and SGS bonds in CPFIS can certainly be transferred to CDP ?

Yes.

As for the charges, just check your CPF Investment Account’s rate card to see which charges (if any) apply.

 

[dork32]

hi henry, you know if there is any limit on using oa to buy tbills?

 

[reddevil0728]

hi henry, you know if there is any limit on using oa to buy tbills?

Similar to constraint for other investment under CPFIS

 

[henrylbh]

hi henry, you know if there is any limit on using oa to buy tbills?

If no other factors affecting calculation, you should be able to use -

OA less 20k = available limit for T-Bill

 

[henrylbh]

I am considering buying 6 mths and 1 year Tbill and close my CPFIS. I am above 55 and RA has FRS sum.

Any idea long long the process takes from the time of application to CPF Board for closure of CPFIS till the securities gets transferred to CDP ?

Is it confirmed that the shares, Tbill and SGS bonds in CPFIS can certainly be transferred to CDP ? What are the charges ?

Thanks.

Why buy Tbill and then close CPFIS?

Why not close CPFIS and use the cash therefrom to by Tbill directly in your name.

 

[henrylbh]

Note carefully the "forced" monthly withdrawals of SA then OA once RA is drained for those CPF members who are still on the classic Retirement Sum Scheme payouts. CPF members still on the classic RSS payouts may wish to switch to CPF LIFE if it's not too late to join given these new SA/OA withdrawals.Where got 'forced' withdrawals of SA then OA us drained for those CPF members who qare still on the classic RSS payouts?

What you say about "forced" monthly withdrawals of SA then OA once RA is drained for those under RSS is confusing, if not misleading. SA/OA after meeting FRS will stay where they are and will be subject to new withdrawal rules. Same for those under CPFL.

 

[dork32]

If no other factors affecting calculation, you should be able to use -

OA less 20k = available limit for T-Bill

thanks, shares got 35% limit

 

[dork32]

Why buy Tbill and then close CPFIS?

Why not close CPFIS and use the cash therefrom to by Tbill directly in your name.

to get the money out of oa without touch the sa?

 

[BBCWatcher]

What you say about "forced" monthly withdrawals of SA then OA once RA is drained for those under RSS is confusing, if not misleading. SA/OA after meeting FRS will stay where they are and will be subject to new withdrawal rules. Same for those under CPFL.

I think you might've missed the rule change (#6). I'm describing exactly what occurs now. Once a classic Retirement Sum Scheme participant drains RA (i.e. simply lives long enough) the CPF Board will start making automatic monthly payouts from SA (until drained) followed by OA (until drained). For "convenience."

If you don't like automatic monthly SA/OA withdrawals upon RA payout exhaustion then one option (if you're below age 80) is to switch to CPF LIFE. CPF LIFE participants are not subject to this new rule.

 

[vsvs24]

Why buy Tbill and then close CPFIS?

Why not close CPFIS and use the cash therefrom to by Tbill directly in your name.

Because I don't like the idea that DBS charge me $2.50 for every purchase and interest received if use CPF OA.

So I use my OA minus 20k to buy Tbills and SGS bond. Then transfer to CDP and handle myself since I above 55 with RA at FRS. When the 6 mths Tbill mature I can roll over and buy more Tbills without having to pay charges. Imagine I buy the longer term SGS bonds and have to pay $2.50 half yearly.

 

[BBCWatcher]

Just bear in mind there's no guarantee T-bill and other SGS interest rates will stay above OA's 2.5% interest rate.

 

[vsvs24]

Just bear in mind there's no guarantee T-bill and other SGS interest rates will stay above OA's 2.5% interest rate.

Yes. All planned out.

I am not working,. So can do VC3A $37740. Good news is there is increased allocation to SA in 2023 for age 55 to 60.

When interest falls very low again, I can also do housing refund if needed.

 

[8zaoyu]

Just bear in mind there's no guarantee T-bill and other SGS interest rates will stay above OA's 2.5% interest rate.

Anyway forumners here will laugh out loud if get to 2.6% stage, somebody said you test to bid 3.5% or 4%, sure cannot get, losing $2.50? Trxn fees only?

 

[8zaoyu]

Yes. All planned out.

I am not working,. So can do VC3A $37740. Good news is there is increased allocation to SA in 2023 for age 55 to 60.

When interest falls very low again, I can also do housing refund if needed.

Good, housing refund to OA, at least earns 2.50%

 

[reddevil0728]

Anyway forumners here will laugh out loud if get to 2.6% stage, somebody said you test to bid 3.5% or 4%, sure cannot get, losing $2.50? Trxn fees only?

got transaction fee if not successful meh?

 

[vsvs24]

got transaction fee if not successful meh?

Not only have to pay transaction fee, lose OA interest for 1 mth. I heard DBS will deduct first. Then unsuccessful refund.

Will verify when I do a small purchase next issue.

 

[reddevil0728]

Not only have to pay transaction fee, lose OA interest for 1 mth. I heard DBS will deduct first. Then unsuccessful refund.

Will verify when I do a small purchase next issue.

Huh really meh?

I thought someone shared that the only deduct the difference after discount

 

[vsvs24]

Huh really meh?

I thought someone shared that the only deduct the difference after discount

I think that is OCBC. That's why I very unhappy with DBS. But my CFPIS with DBS so have to bear with their nonsense or get out.

Anyway I plan to do small test next issue to understand how it works before I start the big purchase. Plan to place $2000 non-competitive and $1000 competitive at 3.9% (test unsuccessful).

 

[reddevil0728]

I think that is OCBC. That's why I very unhappy with DBS. But my CFPIS with DBS so have to bear with their nonsense or get out.

Anyway I plan to do small test next issue to understand how it works before I start the big purchase. Plan to place $2000 non-competitive and $1000 competitive at 3.9% (test unsuccessful).

do you recall which post mentioned about DBS with CPF for T-bill?

Anyway will be great if you can share the next round, so i can update the t-bill thread also. will reach out. thanks!