HWZ Forums

Login Register FAQ Mark Forums Read

If One passed away, how do the Next-Of-Kin get back the monies from Banks?

Like Tree3Likes
Reply
 
LinkBack Thread Tools
Old 07-02-2019, 11:09 PM   #106
Arch-Supremacy Member
 
Join Date: Jun 2010
Posts: 11,035
I'm not fond of naming minors as CPF nominees given the trusteeship costs. Once your child reaches legal adulthood, though, no problem. The public trustee doesn't get involved when the CPF nominee is age 18 or older, so that's the age of adulthood for these specific purposes.

Another possible solution is the CPF Enhanced Nomination Scheme, but I have mixed feelings about that, too, given the potential loss of tax reliefs.

Last edited by BBCWatcher; 07-02-2019 at 11:16 PM..
BBCWatcher is offline   Reply With Quote
Old 08-02-2019, 08:10 AM   #107
Senior Member
 
Join Date: Aug 2018
Posts: 518
Yes the public trustee will hold the funds till she turns 18:
https://www.mlaw.gov.sg/content/pto/...pf-monies.html

Not necessarily a bad thing as my kid will be able to better manage the funds when she’s more mature, anyway it’s only 1%.

I understand you’re not fond (uncomfortable) in putting minors in your nomination, but take note that the benefits for structuring the nomination in this manner outweighs the discomfort, Why?

1) What IF me and my wife go at the same time, individually, each of my kid will get 50% of the CPF funds as per me and my wife’s wishes, just that they’ll get the funds when they turn 18.

2) The surviving person (me OR my wife) need NOT redo the nomination ever again because when the last survivor passes on, the funds will be distributed according to our wishes (50:50).~This point is indeed important to me as the surviving person may be too distraught or forget to re-do the CPF nomination.

I'm not fond of naming minors as CPF nominees given the trusteeship costs. Once your child reaches legal adulthood, though, no problem. The public trustee doesn't get involved when the CPF nominee is age 18 or older, so that's the age of adulthood for these specific purposes.

Another possible solution is the CPF Enhanced Nomination Scheme, but I have mixed feelings about that, too, given the potential loss of tax reliefs.
ELKYme is offline   Reply With Quote
Old 08-02-2019, 08:24 AM   #108
Banned
 
Join Date: Oct 2015
Posts: 8,700
必須問過 何“仙”姑 與 李阿“聾” 先無?
Ed.YEO is offline   Reply With Quote
Old 08-02-2019, 08:51 AM   #109
Arch-Supremacy Member
 
Join Date: Jun 2010
Posts: 11,035
2) The surviving person (me OR my wife) need NOT redo the nomination ever again because when the last survivor passes on, the funds will be distributed according to our wishes (50:50).~This point is indeed important to me as the surviving person may be too distraught or forget to re-do the CPF nomination.
You’ll still want/need to restructure the nominations if/when there’s an additional child.

That said, I don’t think it’s too much of a burden to do something like this:

a) Before child/children are 18: 99% spouse, 1% most likely caretaker for the child/children if both of you pass on (or 98/1/1 if two caretakers);

b) Once the child/children reach age 18: 99% spouse, 1% child (or 98/1/1 for two children, etc.)

That’s two nominations instead of one, granted, but that eliminates the public trustee costs.

....Or could you do all this once? Does CPF allow you to have slightly more complicated nomination instructions that automatically switch over to children as they celebrate their 18th birthdays? It doesn’t look like it, unfortunately, although I see that hundredths of a percentage point are allowed (0.01% instead of 1%, if you wish).

You can put one nominee under the Enhanced Nomination Scheme and another under a cash nomination, so that might be helpful.
BBCWatcher is offline   Reply With Quote
Old 08-02-2019, 09:21 AM   #110
Senior Member
 
Join Date: Aug 2018
Posts: 518
Yes agree that having a 3rd child would make it a necessity to re-do out nominations again, that said, it is highly unlikely that we would have a 3rd child as we are no longer young.

The suggestions you gave may not be viable for me because:

1) I feel that the public trustee charges are not really exorbitant:
First 1K =$24
Next 9K =$135
Next 240K = $1,800

Assuming somebody has 1 million and the nomination for the minor is 1% (10K), the trustee cost amounts to $24+$135=$159.

2) Don’t like to involve any 3rd party such as caregivers as you suggested, what if the caregiver decide to keep the funds?

Don’t think CPF is able to accept complex nominations as the officers assisting CPF members with their nominations are not legally trained probate lawyers.

You’ll still want/need to restructure the nominations if/when there’s an additional child.

That said, I don’t think it’s too much of a burden to do something like this:

a) Before child/children are 18: 99% spouse, 1% most likely caretaker for the child/children if both of you pass on (or 98/1/1 if two caretakers);

b) Once the child/children reach age 18: 99% spouse, 1% child (or 98/1/1 for two children, etc.)

That’s two nominations instead of one, granted, but that eliminates the public trustee costs.

....Or could you do all this once? Does CPF allow you to have slightly more complicated nomination instructions that automatically switch over to children as they celebrate their 18th birthdays? It doesn’t look like it, unfortunately, although I see that hundredths of a percentage point are allowed (0.01% instead of 1%, if you wish).

You can put one nominee under the Enhanced Nomination Scheme and another under a cash nomination, so that might be helpful.
ELKYme is offline   Reply With Quote
Old 08-02-2019, 02:17 PM   #111
Arch-Supremacy Member
 
Join Date: Jun 2010
Posts: 11,035
1) I feel that the public trustee charges are not really exorbitant:
First 1K =$24
Next 9K =$135
Next 240K = $1,800
Assuming somebody has 1 million and the nomination for the minor is 1% (10K), the trustee cost amounts to $24+$135=$159.
No, that's only the initial charge. The public trustee then invests the funds (not in CPF at CPF interest rates) and charges a recurring fee as a percentage of the interest. I haven't found a report listing their historic interest rates, but I have to imagine they're lower than CPF's.

Add that all together, and it's likely to be a big headwind, especially for a younger child.

The CPF Enhanced Nomination Scheme would avoid these costs, assuming the child/children have relatively low or zero balances. And you can do that, for example:

* 99.8% spouse (cash payout)
* 0.1% minor child #1 (Enhanced Nomination Scheme)
* 0.1% minor child #2 (Enhanced Nomination Scheme)

Then update that nomination at least once, when the youngest child reaches age 18, to switch to cash payouts. I think this approach squares everything pretty well.

2) Don’t like to involve any 3rd party such as caregivers as you suggested, what if the caregiver decide to keep the funds?
The scenario here is that both parents die, leaving surviving minor children. Somebody is going to care for the children in that scenario, and hopefully you've worked that out.
BBCWatcher is offline   Reply With Quote
Old 08-02-2019, 03:52 PM   #112
Senior Member
 
Join Date: Aug 2018
Posts: 518
I won’t comment on other charges that the public trustee may impose as I do not have any idea about that.

I see your point about the kids’ financial needs during the interim period before they turn 18 should something happen to both parents. It is indeed a concern for some with younger children.

The best solution I have for the above problem is to have adequate funds so that bequested CPF monies need NOT be used for the purpose of sustainence till the child/children turn 18. This can be done via savings or purchase of sufficient insurance by the parents.

For my own case, its not necessary:
1) It’s within a 5-year period that my youngest turn 18.
2) There’s funds that they have access to that can last them through this period without accounting for the funds from the insurance policies both me and the wifey has.


The scenario here is that both parents die, leaving surviving minor children. Somebody is going to care for the children in that scenario, and hopefully you've worked that out.
ELKYme is offline   Reply With Quote
Old 08-02-2019, 04:20 PM   #113
Arch-Supremacy Member
 
Join Date: Mar 2004
Posts: 12,967
Here's what the CPF Act says:



The definition of 'proper claimant' for the purposes of Section 25 is given in Section 25(7):

Section 25(4A):

(4A) If a person nominated by a member in accordance with subsection (1) has died at the time of payment of the amount payable out of the Fund on the death of the member, and the portion of that amount which the nominated person would have received by payment to the nominated person does not exceed such amount as the Minister may, by notification in the Gazette, specify —
(a) the Board may pay to a proper claimant the whole or any part, as the Board may determine, of the portion of that amount which the nominated person would have received by payment to the nominated person; and
(b) the receipt of the proper claimant shall be a discharge to the Board for the amount paid to the proper claimant under paragraph (a).


I don't think the portion going to the deceased nominated person will be redistributed to those still living.
I believe SKenny is correct. The above provision is not clear, especially 'at the time of payment'.

A nominee who pre-deceased the member would not be entitled to the member's money.
henrylbh is offline   Reply With Quote
Old 28-05-2019, 03:39 PM   #114
Senior Member
 
Join Date: Aug 2016
Posts: 696
Tried looking for this but couldn't find the answer:

what is the nomination process or the workaround for transferring securities to a beneficiary in case of a CDP account?
vegavega25 is offline   Reply With Quote
Old 28-05-2019, 06:03 PM   #115
Arch-Supremacy Member
 
Join Date: Mar 2004
Posts: 12,967
Based on personal experience as administrator, I had on problem transferring the deceased's shares in CPFIA to my personal CDP account by presenting LOA.

For another deceased, I could not take out the shares in the deceased's CDP. CDP requires me to open an estate CDP account.
henrylbh is offline   Reply With Quote
Old 28-05-2019, 09:05 PM   #116
Member
 
Join Date: Mar 2018
Posts: 240
Tried looking for this but couldn't find the answer:

what is the nomination process or the workaround for transferring securities to a beneficiary in case of a CDP account?
There are no workarounds. CDP holdings will be distributed according to the normal rules of succession, either by way of a will or by intestacy.
__________________
春花秋月何時了?往事知多少。小樓昨夜又東風,故國不堪回首月明中。
lifeislonggamma is offline   Reply With Quote
Old 26-03-2020, 11:13 AM   #117
Senior Member
 
Golem_Beatdown_Deck's Avatar
 
Join Date: Aug 2018
Posts: 1,112
Sorry for digging out an old thread but I need some info.

I have a single bank account with XX bank

I have a joint account with my dad with XX bank

Upon the passing of my dad, I withdraw the money from joint account with my dad and transfer to my single name.

1 week later. Then I inform the bank about the passing. Will the bank freeze my single name account?? Because I transfered money from the joint account to single name? Since they realised that I had "cheated"?

To add on, maybe I should close my single name account with XX bank, leaving a joint account with my dad with XX bank

Then I open a new account with ZZ bank. So anything I transfer from XX bank (Joint acc) to ZZ bank (single name) then don't inform XX bank anything about my dad??

Last edited by Golem_Beatdown_Deck; 26-03-2020 at 11:19 AM..
Golem_Beatdown_Deck is offline   Reply With Quote
Old 26-03-2020, 11:51 AM   #118
Senior Member
 
Join Date: Jan 2003
Posts: 1,190
I believe u can do anything to your joint acct even when 1 of the holder passed away.
wutawa is offline   Reply With Quote
Old 26-03-2020, 12:10 PM   #119
Member
 
Join Date: Jun 2009
Posts: 452
I believe u can do anything to your joint acct even when 1 of the holder passed away.
Unless the account was set up such that both parties need to authorize to shift funds. I remember years and years ago when my wife and I set up a joint account we were asked to decide on this.

Nowadays with online banking making transfers so easy the situation may be different.
polyglob is offline   Reply With Quote
Old 26-03-2020, 02:25 PM   #120
Member
 
Join Date: Nov 2009
Posts: 461
Depends on who the administrator is. And what was found out by the administrator.
wharzhee is offline   Reply With Quote
Reply
Important Forum Advisory Note
This forum is moderated by volunteer moderators who will react only to members' feedback on posts. Moderators are not employees or representatives of HWZ. Forum members and moderators are responsible for their own posts.

Please refer to our Terms of Service for more information.


Thread Tools

Posting Rules

Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are On