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EagleToThesSky 07-08-2018 05:47 PM

Quote:

Originally Posted by BBCWatcher (Post 115872855)
You cannot top up only your OA; you have to choose an "all three" top up (CPF Form VC/1). Unless you're self-employed and contributing on the basis of that income, no, there's no tax relief with an "all three" top up.


Cash top ups to MA once it has reached the Basic Healthcare Sum are not allowed.

cannot believe I am still confused on this matter...Please let me know whether below is correct.

A table would be nice, but it does not seem to be supported. I might do a picture after all info is validated :)

before age 55
There are 3 types of voluntary contributions to CPF:
1. Cash top-up to SA: only limit is the FRS. Tax relief cap at 7k per account and 14k per person per year, subject to total tax relief amount (80K) and taxable income etc. You can make the contribution anytime in the year, from Jan 1 to Dec 31, for as many times as you want. Interest starts from the following month, so try to make it towards end of the month.
2. Cash top-up to MA: subject to both CPF annual limit and BHS. Tax relief on all the top-up amount, subject to total tax relief amount (80K) and taxable income etc. You can make the contribution anytime in the year, from Jan 1 to Dec 31, for as many times as you want. Interest starts from the following month, so try to make it towards end of the month.
3. "All three" top-up: only limit is CPF annual limit, funds distributed to all three accounts according to the same percentage as the mandatory contribution. If MA is at BHS, the fund will flow to SA; if SA reaches FRS, the funds will flow to OA. No tax relief at all. You can make the contribution anytime in the year, from Jan 1 to Dec 31, for as many times as you want. Interest starts from the following month, so try to make it towards end of the month.

Upon reaching age 55
You can only cash top up RA, pretty similar to how cash top-up to SA works.
1. Cash top-up to RA: only limit is the ERS. Tax relief cap at 7k per account and 14k per person per year, subject to total tax relief amount (80K) and taxable income etc. You can make the contribution anytime in the year, from Jan 1 to Dec 31, for as many times as you want. Interest starts from the following month, so try to make it towards end of the month.

Shiny Things 07-08-2018 10:53 PM

Quote:

Originally Posted by tangent314 (Post 115872009)

Of course, it will come back down right after that, but the point is that 10 year yield still needs to have some context looked into

Sorry, disregard that post - I am a knob, completely misread your post and didn't realise you were talking about the trailing STI returns. You're 100% right.

BBCWatcher 07-08-2018 11:59 PM

Quote:

Originally Posted by EagleToThesSky (Post 115879862)
3. "All three" top-up: only limit is CPF annual limit, funds distributed to all three accounts according to the same percentage as the mandatory contribution. If MA is at BHS, the fund will flow to SA; if SA reaches FRS, the funds will flow to OA.

I'd write that last sentence this way:

"If MA is at BHS, the MA portion will flow into SA, except if the SA is at the FRS then the MA portion will flow into OA."

Quote:

Upon reaching age 55
You can only cash top up RA, pretty similar to how cash top-up to SA works.
No, MA and "all three" top ups are still available, and according to the same rules.

Quote:

1. Cash top-up to RA: only limit is the ERS. Tax relief cap at 7k per account and 14k per person per year, subject to total tax relief amount (80K) and taxable income etc.
There is no tax relief once the RA has reached the FRS.

EagleToThesSky 08-08-2018 12:37 PM

Quote:

Originally Posted by BBCWatcher (Post 115885981)
I'd write that last sentence this way:

"If MA is at BHS, the MA portion will flow into SA, except if the SA is at the FRS then the MA portion will flow into OA."

Right. This is more accurate, as SA portion will never overflow.


Quote:

No, MA and "all three" top ups are still available, and according to the same rules.
Thank you!

Quote:

There is no tax relief once the RA has reached the FRS.
Can we still cash-topup RA if FRS is reached? or it should rather be ERS for CPF life?

Thank you.

BBCWatcher 08-08-2018 03:34 PM

Quote:

Originally Posted by EagleToThesSky (Post 115892851)
Can we still cash-topup RA if FRS is reached? or it should rather be ERS for CPF life?

Yes, you can top up anybody's Retirement Account up as high as the Enhanced Retirement Sum. Tax relief applies (if it applies) up to the Full Retirement Sum.

thekang 08-08-2018 03:35 PM

Quote:

Originally Posted by maple96 (Post 115871881)
I like best your unbiased view on STI returns, most people here oversold the returns of STI here, including most financial bloggers, failed their maths badly!

On the other hand, I personally believe CPF's 4% interest is not supportable in the long term. GIC investment performance is not that great anymore.

Under CPF Act, only the minimum 2.5% interest is guaranteed. The 4% interest for SA and MA can be changed anytime by the government.

Not saying CPF is bad (I also have lots of money in it), just something else to consider.

BBCWatcher 08-08-2018 03:54 PM

Quote:

Originally Posted by thekang (Post 115895692)
On the other hand, I personally believe CPF's 4% interest is not supportable in the long term.

First of all, real yields are the only yields that matter, not nominal. Inflation in Singapore is currently running a little below 1%/year. Thus real yields on MA/SA/RA are slightly above 3%, excluding bonus interest and tax relief.

I disagree. I think that sort of real yield is sustainable.

If the government chooses to reduce the real yield at some point in the future, it won't be because it's not financially sustainable but rather to adjust resource allocations. And there's already some "pre-programmed" adjustment in the pipeline, because bonus interest and tax relief are not automatically adjusted for inflation.

maple96 08-08-2018 04:08 PM

Quote:

Originally Posted by thekang (Post 115895692)
On the other hand, I personally believe CPF's 4% interest is not supportable in the long term. GIC investment performance is not that great anymore.

Under CPF Act, only the minimum 2.5% interest is guaranteed. The 4% interest for SA and MA can be changed anytime by the government.

Not saying CPF is bad (I also have lots of money in it), just something else to consider.

my comment on STI returns was in comparison to my WL which returns more than 4% pa compounded over more than 20 years :s13:

But I still like RA compared to pte annuity plans and I plan to make use of RA for my annuity.

EagleToThesSky 08-08-2018 05:00 PM

Quote:

Originally Posted by maple96 (Post 115896153)
my comment on STI returns was in comparison to my WL which returns more than 4% pa compounded over more than 20 years :s13:

But I still like RA compared to pte annuity plans and I plan to make use of RA for my annuity.

What is WL?

EagleToThesSky 08-08-2018 05:11 PM

Quote:

Originally Posted by BBCWatcher (Post 115895677)
Yes, you can top up anybody's Retirement Account up as high as the Enhanced Retirement Sum. Tax relief applies (if it applies) up to the Full Retirement Sum.

Thank you, BBCW!

MrHighlander 10-08-2018 01:01 AM

Where did you get this chart of the STI historical returns from ? Is it a website, trading platform or app?

Quote:

Originally Posted by tangent314 (Post 115872009)
https://i.imgur.com/kPXPsxe.png




Of course, it will come back down right after that, but the point is that 10 year yield still needs to have some context looked into


tangent314 10-08-2018 01:57 AM

Quote:

Originally Posted by MrHighlander (Post 115920386)
Where did you get this chart of the STI historical returns from ? Is it a website, trading platform or app?


That's from SPDR's fact sheet for ES3

zuppeur 10-08-2018 08:00 AM

My parents is above 55.
I intend to top up their cpf to enjoy the 6% interest for the first 30k.

Would i be able to top up to their SA?
What are the difference topping up their SA vs RA?

BBCWatcher 10-08-2018 09:39 AM

Quote:

Originally Posted by zuppeur (Post 115921762)
My parents is above 55.
Would i be able to top up to their SA?

No, not efficiently, not only.

Hypothetically, anybody could voluntarily top up all three of a CPF member's accounts (SA, MA, OA) using CPF Form VC/1 or its electronic equivalent. A portion of that "all three" top up will flow into the member's SA. How much depends on the member's age. However, there's no tax relief for that sort of top up. Also, this type of top-up must fit within the member's (not the donor's) CPF Annual Limit of $37,740. And the portion that is allocated to OA earns 2.5%, not the higher interest rate.

Once a CPF member reaches age 55 anybody can top up that member's Retirement Account up as high as the Enhanced Retirement Sum (ERS). Tax relief may be available for top ups up to the Full Retirement Sum. (There are some additional qualifications for tax relief.)

Quote:

What are the difference topping up their SA vs RA?
In addition to the above differences, RA top-ups feed into the member's CPF LIFE payouts, for higher lifetime retirement income.

maple96 10-08-2018 09:55 AM

Quote:

Originally Posted by zuppeur (Post 115921762)
My parents is above 55.
I intend to top up their cpf to enjoy the 6% interest for the first 30k.

Would i be able to top up to their SA?
What are the difference topping up their SA vs RA?

How old are they now?

What is the balance in their RA now? If more than 60k, they are already enjoying the extra interest.


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