Accrued interest in CPF

[malthead]

There are two cases where it may make sense to pay back your accrued interest and the amount that you have withdrawn for your property.

1. You intend to upgrade your property with the spare cash, so whatever you put in now will then go towards paying for the new property.

2. You don't need the money until age 55, so you just want some place to park the money paying you 2.5% interest until that age. For this however, there are better options out there. First, if your CPF MA is not yet at the BHS, you should top up your MA first which will provide you with tax relief. Secondly, if your CPF SA is not yet at FRS and you haven't already made your annual CPF SA topup of $7000 that qualifies for tax relief, then you should do that first. Third, if you are self-employed, you have the option of making voluntary contribution to CPF that qualifies for tax relief. If you can no longer do the 3 above, then paying back your accrued interest becomes a viable option, optionally transferring from OA to SA after that.

Under current interest environment, it makes sense to return cash that is left idle

 

[dork32]

Under current interest environment, it makes sense to return cash that is left idle

another peace of mind guy.

under current interest environment, it makes sense to return cash to cpf oa if the cash is idling

 

[malthead]

another peace of mind guy.

under current interest environment, it makes sense to return cash to cpf oa if the cash is idling

Personal project to see how much cpf I can have at 55

 

[Thoreldan]

Personal project to see how much cpf I can have at 55

Any estimated amt ?

 

[malthead]

Any estimated amt ?

If all goes well, 1.2m

 

[Thoreldan]

If all goes well, 1.2m

Wow very nice
Likely an even bigger sum from cash investments ?

 

[malthead]

Wow very nice
Likely an even bigger sum from cash investments ?

That one harder to project

 

[lifeafter41]

I log in the cpf website. There is a net loan amount and accured interest amount. Is the accured interest amount shown will be forever increasing? So in the event after paying finish the cpf loan. The interest will still be there increasing. So if I passed
Away..and my kids sell away my flats. The total amount still must pay back the interest...?

If you passed away, your wife will be inheriting the HDB, even if she chooses to sell it away, the money goes to her.

You are already death, why worry about money or interest......lol

 

[reddevil0728]

Assumed wife not around. Scared government makan. Anyone know?

Makan what? Don’t anyhow spread fake news later POFMA

 

[davidtanwei]

When we buy first bto:

1) we used to make initial payment and miscellaneous stuff using oa. Then before take key...
Our cpf oa will be wiped out. These cpf oa being wiped out is principal amount and will incur accured interest? That mean forever own money unless the next sale can cover everything. If don't intend to sell..the amount accured interest will compound forever.

2) after wiping oa. The balance
Will borrow from cpf and pay monthly for 25 years. Accured interest already lump inside in the monthly payment?

 

[apriliasiao]

Gov is a loan shark la. technically we are paying almost 5% just by taking HDB loan and CPF accrued interests.. damn...
make it easy for us to use but suck us up DRY!

 

[hwmook]

Gov is a loan shark la. technically we are paying almost 5% just by taking HDB loan and CPF accrued interests.. damn...
make it easy for us to use but suck us up DRY!

That 2.5% is paid to yourself. Don't lump together with mortgage interest.

 

[hwmook]

When we buy first bto:

1) we used to make initial payment and miscellaneous stuff using oa. Then before take key...
Our cpf oa will be wiped out. These cpf oa being wiped out is principal amount and will incur accured interest? That mean forever own money unless the next sale can cover everything. If don't intend to sell..the amount accured interest will compound forever.

2) after wiping oa. The balance
Will borrow from cpf and pay monthly for 25 years. Accured interest already lump inside in the monthly payment?

1. So what is your point?

2. What are you trying to say? Accured interest doesn't need to be paid unless you are selling the property.

 

[henrylbh]

Gov is a loan shark la. technically we are paying almost 5% just by taking HDB loan and CPF accrued interests.. damn...
make it easy for us to use but suck us up DRY!

At the end the accrued interest returned to CPF is your money. If you think you are paying almost 5% interest, then it's a dumb idea to use CPF instead of cash to pay for housing loan. It's even more dumb if you have monthly spare cash in bank and yet use CPF to pay.

 

[BBCWatcher]

1) we used to make initial payment and miscellaneous stuff using oa. Then before take key...
Our cpf oa will be wiped out....

Like hwmook, I'm not sure what you're asking. But no, your CPF Ordinary Account isn't "wiped out." When you take a HDB loan, you're allowed to keep up to $20,000 in your Ordinary Account (per individual, so up to $40,000 per couple). The amount in excess of $20,000 doesn't disappear. It's swept into your HDB leasehold equity. If you don't like the "sweep," then there's a particularly easy solution before you pick up the keys: just transfer OA funds into your SA and/or (if you have sufficient funds) into a qualified family member's SA/RA.

 

[reddevil0728]

Gov is a loan shark la. technically we are paying almost 5% just by taking HDB loan and CPF accrued interests.. damn...
make it easy for us to use but suck us up DRY!

How is paying to yourself = loan shark???

 

[twinbaby]

is it worth for my father age 64 to top up his RA account? or is there better option

 

[reddevil0728]

is it worth for my father age 64 to top up his RA account? or is there better option

ur dad hit BRS/FRS/ERS?

 

[BBCWatcher]

is it worth for my father age 64 to top up his RA account? or is there better option

Nothing else even comes close if you want to provide him with a guaranteed Singapore dollar monthly income for life (CPF LIFE), and this one happens to be government guaranteed. But what does "better" mean to him and you?

 

[twinbaby]

ur dad hit BRS/FRS/ERS?

nope， he is self employed. but willing to top up a large some of money to the CPF RA, but from what I gathered, the money will be depleted at around age 88-90 and the benefactors gets nothing if my father lives till this long.