CPF Account Value Thread 2025

[laokorkor]

Bid-ask spreads on ETFs should not be counted when comparing with unit trusts, especially when it's the same destination fund.

I don't get this point. If I buy a unit trust at 100 SGD, that means 100 SGD gets into the destination Vanguard Global index brokerage account. If I buy an ETF at 100.50 SGD ask price, 100 SGD gets into the destination Vanguard Global index brokerage account and the market maker pockets 0.5 SGD. How should this be not counted?

Furthermore, how does IB mitigate the ETF currency bid/ask spread? You've to exchange SGD to USD when you buy and back when you sell, right?

These're 2 killer costs for ETF.

 

[BBCWatcher]

I don't get this point. If I buy a unit trust at 100 SGD, that means 100 SGD gets into the destination Vanguard Global index brokerage account. If I buy an ETF at 100.50 SGD ask price, 100 SGD gets into the destination Vanguard Global index brokerage account and the market maker pockets 0.5 SGD. How should this be not counted?

Because the price you pay to Lion Global is the asking price, the 100.50 in your example.

....And just set a limit price on the ETF if you want, as a "bonus."

Furthermore, how does IB mitigate the ETF currency bid/ask spread? You've to exchange SGD to USD when you buy and back when you sell, right?

Lion Global has to go to the currency markets too. Yes, of course if you're paying POEMS 0.5% (for example) for currency conversion then that'd be an actual differential cost. At Interactive Brokers it's a flat fee of US$2.18 to access institutional, global currency markets — close to what a CPFIA bank would charge for their purchase fee.

These're 2 killer costs for ETF.

There are 24 basis points per year of additional expenses with Lion Global's indirect purchasing route, plus recurring CPFIA fees, plus "$20K OA drag." These costs are significant. It's also the "wrong" fund: VWRA (or ISAC) would be better. Including "emerging market" stocks is great. You also said "hold for 20 years." What's that 24 basis point cost difference, compounded for 20 years, going to mean? (Plus CPFIA fees?) A lot!

But on top of all of that you've got to lock unrestricted cash in OA until at least age 55 if you take that indirect route. I do not like that idea at all.

 

[BBCWatcher]

I'm looking at VHVE right now (at this instant) in live trading on the London Stock Exchange. Let's assume you don't believe me, and you want to assign the full bid-ask spread as a "penalty" to the direct ETF purchase. Here are the current bid/offer prices:

Bid: US$129.04
Offer: US$129.24

That's 20 cents or about 0.155%. Let's round that up to 16 basis points. That's still 8 basis points less than the expense ratio difference!

Let's recap....

1. When you purchase VHVE directly via Interactive Brokers, you pay a currency conversion charge (US$2.18) and a broker commission. (If you want to assign the bid-ask spread as a "penalty," even though that's not an actual differential cost, be my guest. That's only ~16 basis points, equivalent to 8 months of holding.) When you sell, presumably the same thing. Between those two events you're charged a 12 basis point annual expense ratio and nothing else.
2. When you purchase VHVE indirectly via Lion Global (and routed through CPF OA), you pay a CPFIA fee. When you sell, presumably the same thing (a CPFIA fee). Between those two events you're charged a 36 basis point annual expense ratio (+24 basis points higher) plus quarterly CPFIA fees. You may also have a "drag" involving maintaining $20,000 in your OA (since only dollars in excess of $20K can be invested via the CPF Investment Scheme). And you take the liquidity hit until at least age 55, plus "burn" some/all CPF OA repayment quota that could've been useful as a "high yield savings account" in low interest rate periods, especially for age 55+ needs.

Option #1 is highly likely to be the better option. It'll depend to some extent on how much unrestricted cash you're investing, and at what intervals. But at least with "nontrivial" investment flows the direct path is highly likely to be the winner.

 

[royalmix]

From today, you can redeem healthy 365 points to offset your Medishieldlife premium, if you qualify!

Instant credit to CPF!

 

[henrylbh]

Now only got 3970 healthy 365 point. Nothing much.

 

[DevilPlate]

I'm using Phillips POEMS (previously)/FSMOne (now) and DCA around 2k SGD monthly into Infinity Global Stock Index SGD C. My calculation is that the 2 dozen or so basis points expense ratio for the unit trust is worth paying.

For the unit trust, my DBS agent bank CPFIA charges me 2.73 SGD. That's it!

For ETF, Phillips POEMS charges (1) 12++ GBP brokerage (2) currency exchange bid/ask around 0.5% (3) LSE price bid/ask another 0.5% hit. When I sell, I'll get hit again.

Buying VHVE will need many years of expense ratio saving to earn back the other costs, watching only expense ratio is not holistic.

Leme kapo

ETF initial buy cost would be higher but hold long term >5years it will be much cheaper than UT due to lower TER.

If u frequently switch funds/rebalance then UT is better imo because switching funds no charges also.

 

[BBCWatcher]

If u frequently switch funds/rebalance then UT is better imo because switching funds no charges also.

Probably not, or at least it isn't clear. You get whacked with CPFIA fees when there are fund transactions. Those CPFIA transaction charges are in addition to the quarterly CPFIA fees.

In an ordinary brokerage account (with unrestricted cash) your rebalancing is typically simply buying more of the "low" fund(s) as part of your ordinary monthly, bimonthly, or quarterly dollar cost averaging. Conceivably that could be true within a CPFIA account as well, but there are far fewer fund choices available. And the choices that are available are high cost.

Routing unrestricted dollars into CPF OA for investing is just not a great idea, not generally.

 

[s0crates]

Probably not, or at least it isn't clear. You get whacked with CPFIA fees when there are fund transactions. Those CPFIA transaction charges are in addition to the quarterly CPFIA fees.

In an ordinary brokerage account (with unrestricted cash) your rebalancing is typically simply buying more of the "low" fund(s) as part of your ordinary monthly, bimonthly, or quarterly dollar cost averaging. Conceivably that could be true within a CPFIA account as well, but there are far fewer fund choices available. And the choices that are available are high cost.

Routing unrestricted dollars into CPF OA for investing is just not a great idea, not generally.

Let me tell you DEFINITIVELY, that there is no agent bank charges for switching if you are doing it as a switch/rebalance on the same platform.

This is coming from a non-US person with a CPFIS investment account.

 

[BBCWatcher]

Let me tell you DEFINITIVELY, that there is no agent bank charges for switching if you are doing it as a switch/rebalance on the same platform.

OK, but that still leaves the much higher annual fund expenses, quarterly bank fees, and “$20K drag.“ The point remains that you’re extremely unlikely to come out ahead routing cash via CPF OA to invest versus just investing your cash directly.

….Make that impossible to come out ahead via CPF OA. Amundi offers a global stock index fund on POEMS (A12S) that tracks the same index Lion Global does if you don’t like Interactive Brokers for whatever reason. True, Amundi’s Luxembourgh domicile results in a higher dividend tax on U.S. shares (paid by the fund managers), but you’re still going to come out way ahead routing cash directly into A12S versus the “Rube Goldberg” indirect investment path via CPF OA. A12S at POEMS (direct cash investment) should cost about 22 basis points per year all-in, including the higher dividend tax. That’s versus 36 basis points with Lion Global even before you get to the additional CPF-related costs. The latter is just crazy when you‘re starting with unrestricted cash. Go direct!

Obviously I have no problem with CPF. CPF is great for many reasons. But this isn’t one of them! It makes no sense to increase your investment costs and reduce your liquidity, which is what routing unrestricted cash into CPF OA for investing would do.

 

[royalmix]

I am 45, considering doing VHR with my surplus cash. After doing VHR already, then I'll invest the excess OA in UT. Not sure anyone has experience going through and what are your thoughts?

Ask CHATGPT:

(Do your own fact check)

---

The Strategy​

"Refund CPF OA (to earn 2.5%), then use the refunded OA to invest under CPFIS."

This way, you:

1. Stop losing 2.5% per year on withdrawn CPF (used for housing, etc.).
2. Put the refunded OA back to work through investments (CPFIS).

---

Pros of This Strategy​

1. You regain 2.5% CPF interest on refunded funds​

Once refunded, CPF starts compounding that amount (if you don’t invest all of it right away).

2. You keep growing your CPF nest egg​

Investments under CPFIS stay in CPF — you can't withdraw them, but they contribute to your retirement sum.

3. You get to invest, but inside a "forced savings" wrapper​

If you're the type who might spend cash or not consistently invest, this method forces discipline.

---

Cons and Caveats​

1. CPFIS has restrictions and fees​

• Not all investments are allowed (e.g., risky products, leverage, crypto).
• There's a $20k minimum OA balance you must keep before you can invest OA funds.
• Investment fees apply (brokerage, platform fees, etc.).

2. CPFIS returns are not guaranteed​

• If your CPFIS investment underperforms (e.g., returns <2.5%), you're worse off than just leaving money in OA.
• Historical data shows many CPFIS investors underperform the OA rate, especially when DIY.

3. Lack of liquidity​

• CPF OA investments can't be withdrawn as cash.
• You're locking up both the capital and the investment returns until eligible for CPF payout.

---

Who is This Strategy Good For?​

Good if:

• You want to rebuild your CPF for retirement purposes.
• You're confident you can pick better investments under CPFIS (e.g., STI ETF, blue-chip stocks, unit trusts).
• You don’t need immediate liquidity.
• You want long-term, disciplined investing.

Not ideal if:

• You prefer full control over your money.
• You want access to the cash for other uses.
• You're not confident your CPFIS investments will beat 2.5%.

---

Comparison Table​

Option	CPF Refund + CPFIS	Just Invest Cash	Refund CPF Only
Returns	Potentially >2.5%, but not guaranteed	Potentially higher (more options)	2.5% guaranteed
Liquidity	Locked	Liquid	Locked
Risk	Medium	Medium to High	Very Low
Flexibility	Moderate	High	Low
Retirement Planning	Strong	Weaker	Strong

---

My Take (Objective):​

• If your main goal is to rebuild CPF and you're OK with long-term, less flexible investing — this strategy makes sense.
• If you want better returns AND liquidity, you're better off investing cash outside CPF.
• If you're risk-averse and don't want to manage investments, just refund CPF OA and let it earn 2.5%.

---

 

[BBCWatcher]

ChatGPT happens to be wrong. As one example, how is "Retirement Planning" weaker when your cash investments earn higher net returns (because investment costs are lower)? That's exactly backwards!

The question on the floor is whether it makes more sense to take unrestricted cash, route it via CPF OA (though housing repayment), and invest it in the Lion Global Infinity Global Stock Index Fund than to take the same cash and invest it directly in an equivalent fund (such as VHVE via Interactive Brokers or A12S via POEMS). The answer is clearly no. All you're doing when you route unrestricted cash via CPF OA to invest is raising costs and decreasing liquidity. You will be poorer using the indirect path in this comparison. The cost-related math is clear.

However, if that's not the actual comparison — if the choice is actually between repaying OA to invest or buying a 2 TB iPhone 17 Pro Max — then the former will be better from a saving and wealth accumulation perspective.

Accrued OA interest "panic" is a common fallacy. More accrued interest is a good thing, other things being equal. It means that you have that much more room to deposit cash into a 2.5% interest earning account (to actually earn that interest) if/when that should ever be a comparatively attractive option. With asset protection characteristics, too. However, asset protection features are lost when dollars are invested via the CPF Investment Scheme. It's only when the dollars are actually in basic CPF accounts such as OA that you enjoy asset protection features.

 

[marcoyeo]

Ask CHATGPT:

(Do your own fact check)

---

The Strategy​

This way, you:

1. Stop losing 2.5% per year on withdrawn CPF (used for housing, etc.).
2. Put the refunded OA back to work through investments (CPFIS).

---

Pros of This Strategy​

1. You regain 2.5% CPF interest on refunded funds​

Once refunded, CPF starts compounding that amount (if you don’t invest all of it right away).

2. You keep growing your CPF nest egg​

Investments under CPFIS stay in CPF — you can't withdraw them, but they contribute to your retirement sum.

3. You get to invest, but inside a "forced savings" wrapper​

If you're the type who might spend cash or not consistently invest, this method forces discipline.

---

Cons and Caveats​

1. CPFIS has restrictions and fees​

• Not all investments are allowed (e.g., risky products, leverage, crypto).
• There's a $20k minimum OA balance you must keep before you can invest OA funds.
• Investment fees apply (brokerage, platform fees, etc.).

2. CPFIS returns are not guaranteed​

• If your CPFIS investment underperforms (e.g., returns <2.5%), you're worse off than just leaving money in OA.
• Historical data shows many CPFIS investors underperform the OA rate, especially when DIY.

3. Lack of liquidity​

• CPF OA investments can't be withdrawn as cash.
• You're locking up both the capital and the investment returns until eligible for CPF payout.

---

Who is This Strategy Good For?​

Good if:

• You want to rebuild your CPF for retirement purposes.
• You're confident you can pick better investments under CPFIS (e.g., STI ETF, blue-chip stocks, unit trusts).
• You don’t need immediate liquidity.
• You want long-term, disciplined investing.

Not ideal if:

• You prefer full control over your money.
• You want access to the cash for other uses.
• You're not confident your CPFIS investments will beat 2.5%.

---

Comparison Table​

Option	CPF Refund + CPFIS	Just Invest Cash	Refund CPF Only
Returns	Potentially >2.5%, but not guaranteed	Potentially higher (more options)	2.5% guaranteed
Liquidity	Locked	Liquid	Locked
Risk	Medium	Medium to High	Very Low
Flexibility	Moderate	High	Low
Retirement Planning	Strong	Weaker	Strong

---

My Take (Objective):​

• If your main goal is to rebuild CPF and you're OK with long-term, less flexible investing — this strategy makes sense.
• If you want better returns AND liquidity, you're better off investing cash outside CPF.
• If you're risk-averse and don't want to manage investments, just refund CPF OA and let it earn 2.5%.

---

Thank you for sharing, appreciate it.

I used Chatgpt before for this topic, but I would want to hear others' perspective here.

 

[royalmix]

Thank you for sharing, appreciate it.

I used Chatgpt before for this topic, but I would want to hear others' perspective here.

Good, CHATGPT do not always provide the same answer, hope you get something different from my Chat.

As CHATGPT highlighted, look at the big picture/objectives, it varies with each person, as financial planning is very personal. So ask yourself, what are your big picture/objectives?

Once you have decided the direction, you can also read this thread, if you are not aware:

https://forums.hardwarezone.com.sg/threads/poems-offering-amundi-ut.7085655/

(not vested)

 

[BBCWatcher]

As CHATGPT highlighted, look at the big picture/objectives, it varies with each person, as financial planning is very personal.

No, on this occasion it’s b.s. ChatGPT is just spewing textual diarrhea.

You will never be better off taking cash, repaying OA, and investing in Lion Global’s Infinity Global Stock Index Fund (via POEMS) compared to taking the same cash and investing directly in Amundi A12S (also via POEMS) for the same period of time. This particular comparison is 100% crystal clear.

If someone wants to ask a different question, maybe there’s a different answer.

Do any of you work for Lion Global? What’s really going on? As it happens, Lion Global offers a decent deal for dollars that are already in OA. But not for unrestricted cash, at least not this way.

 

[DevilPlate]

No, on this occasion it’s b.s. ChatGPT is just spewing textual diarrhea.

You will never be better off taking cash, repaying OA, and investing in Lion Global’s Infinity Global Stock Index Fund (via POEMS) compared to taking the same cash and investing directly in Amundi A12S (also via POEMS) for the same period of time. This particular comparison is 100% crystal clear.

If someone wants to ask a different question, maybe there’s a different answer.

Do any of you work for Lion Global? What’s really going on? As it happens, Lion Global offers a decent deal for dollars that are already in OA. But not for unrestricted cash, at least not this way.

Perhaps many OCBC shareholders here

 

[henrylbh]

Perhaps many OCBC shareholders here

I not only OCBC shareholders but card holder and account holder in Sg as well as My

 

[koolkool]

Hi. Pardon my ignorance as I am always confused on CPF matters even after trying to read and search for answers. Hopefully someone has the answers and have gone through this stage of your life to provide their experience.

If at age 55, I chose BRS and pledge my property. Then I do a full VHR of the amount I owe CPF and stop paying my housing loan using CPF. Will this amount flow to OA or it will fill up the remaining amount to FRS, and remaining flow to OA that are eligible for withdrawal any time? Or the best option is to do a VHR minus half of the FRS so that that amount still remain with CPF? I am wondering how CPF know I am selling my pledged property if I no longer use CPF to service my loans after 55?

Also, what exactly is "pledging my property" really means? I did a AI check, it seemed like there is some kind of "legal charge" is created on the pledged property to secure the amount of RA savings withdrawn. Is there any lawyer fees involved to do this legal charge. I think it's the same process like a bank which I took a loan on the pledged property when I first finance the loan? Is this pledge can be removed, and I refund back the amount I withdraw?

Seemed like what I read most will be doing FRS and some ERS but seldom I know anyone doing BRS. I thought if we can generate returns greater than 4% and want to pass as much to our kids, this seemed to be a no brainer? What is your considerations when you chose FRS over BRS? A more fuss-free retirement with monthly income guaranteed, perhaps?

 

[BBCWatcher]

If at age 55, I chose BRS and pledge my property.

To be clear, "choosing the Basic Retirement Sum" means you reduce (or otherwise cause) your CPF Retirement Account to be funded only to the BRS ($106,500 in 2025). Let's assume that's what you mean.

Then I do a full VHR of the amount I owe CPF and stop paying my housing loan using CPF. Will this amount flow to OA or it will fill up the remaining amount to FRS, and remaining flow to OA that are eligible for withdrawal any time?

Just before age 55 you can pledge your property (although you may already have a sufficiently large property charge), and you can ask CPF to reserve funds in your OA for servicing your mortgage. In other words, yes, you can cause your RA to be funded only to the BRS. Thereafter you can stop paying your mortgage using OA, and you can voluntarily refund OA dollars used for housing (and then pledge your property). All possible. You would end up with the BRS in your RA (earning 4.0% interest plus bonus interest), whatever your MA balance is, and everything else you have at CPF in your OA. (Your SA is closed at age 55.) Compulsory contributions would flow only into MA (if it's below the Basic Healthcare Sum) and OA in this scenario.

Or the best option is to do a VHR minus half of the FRS so that that amount still remain with CPF?

Best option for what? What are you trying to accomplish? If for example you're trying to earn as much CPF interest as possible, or to secure at least decent future retirement income, what you're describing is the opposite of those goals.

I am wondering how CPF know I am selling my pledged property if I no longer use CPF to service my loans after 55?

Pledging your property means the CPF Board is informed if/when you sell it.

Also, what exactly is "pledging my property" really means? I did a AI check, it seemed like there is some kind of "legal charge" is created on the pledged property to secure the amount of RA savings withdrawn.

That's right.

Is there any lawyer fees involved to do this legal charge.

Not that I'm aware of.

I think it's the same process like a bank which I took a loan on the pledged property when I first finance the loan?

It's akin to a lender's interest in a mortgaged property.

Is this pledge can be removed, and I refund back the amount I withdraw?

Yes, you can lift the property pledge by funding your RA at least to the Full Retirement Sum.

Seemed like what I read most will be doing FRS and some ERS but seldom I know anyone doing BRS. I thought if we can generate returns greater than 4% and want to pass as much to our kids, this seemed to be a no brainer?

No, it's not a "no brainer." First, you haven't even tried to generate returns greater than 4% in the scenario you outlined because you're refunding OA dollars used for housing. OA earns only 2.5%. Second, dollars saved in CPF are uniquely well protected against creditors, court judgments, fraud, and other calamities. These asset protection characteristics have some value. Third, the 4.0% "floor rate" can sometimes increase, as it did in the recent interest rate cycle. Fourth, the 4.0% "floor rate" is not quite government guaranteed, but it's a low risk/high confidence rate. Alternatives should be assessed in risk-adjusted terms. Fifth, RA feeds into the best available Singapore dollar longevity insurance. Longevity insurance offers an extremely high safe spending level per input dollar, far higher than you can safely support from conventional, non-insurance investments even if they are higher yielding. Longevity insurance and conventional, non-insurance investments are not directly comparable.

What is your considerations when you chose FRS over BRS? A more fuss-free retirement with monthly income guaranteed, perhaps?

Spend some time learning what (high quality) longevity insurance is and the critical role it plays in (easier, more reliable) retirement financial planning.

 

[henrylbh]

Hi. Pardon my ignorance as I am always confused on CPF matters even after trying to read and search for answers. Hopefully someone has the answers and have gone through this stage of your life to provide their experience.

If at age 55, I chose BRS and pledge my property. Then I do a full VHR of the amount I owe CPF and stop paying my housing loan using CPF. Will this amount flow to OA or it will fill up the remaining amount to FRS, and remaining flow to OA that are eligible for withdrawal any time? Or the best option is to do a VHR minus half of the FRS so that that amount still remain with CPF? I am wondering how CPF know I am selling my pledged property if I no longer use CPF to service my loans after 55?

Also, what exactly is "pledging my property" really means? I did a AI check, it seemed like there is some kind of "legal charge" is created on the pledged property to secure the amount of RA savings withdrawn. Is there any lawyer fees involved to do this legal charge. I think it's the same process like a bank which I took a loan on the pledged property when I first finance the loan? Is this pledge can be removed, and I refund back the amount I withdraw?

Seemed like what I read most will be doing FRS and some ERS but seldom I know anyone doing BRS. I thought if we can generate returns greater than 4% and want to pass as much to our kids, this seemed to be a no brainer? What is your considerations when you chose FRS over BRS? A more fuss-free retirement with monthly income guaranteed, perhaps?

From what I understand, at age 55 or thereafter you can withdraw CPF amount above BRS + top-up, if any, with sufficient property charge/pledge. If you decide to withdraw amount above BRS+top-up in later years with property charge/pledge, the amount of withdrawal is still based on the amount when you were age 55.

If you do full VHR, the amount will go to your OA only as you have opted for BRS with property charge and OA is withdrawable any time, unless you choose to transfer the amount to make good RA what you have withdrawn plus accrued interest or top up RA above FRS.

Then if you sell your property, you will have to make good RA with the amount withdrawn plus accrued interest.

If you are using CPF to pay in full or part for the property, the charge on your property will always be there, even if you are above 55 with FRS, until you refund all CPF used to purchase or charge the property. Up to this stage there is no lawyer fee involved in charging. But if you refund all CPF, the charge will be discharged. Subsequent pledging will incur legal charges.

In my case, my property is fully paid by cash at time of purchase and hence there was a never a charge on my property. So if i wish to pledge my property for BRS, there will be valuation and legal fee involved.

 

[henrylbh]

Yes, you can lift the property pledge by funding your RA at least to the Full Retirement Sum.

From what I know even if you have FRS, your property, with CPF used and accrued interest, is charged until sold. Of course, there is no need to refund the CPF and accrued interest on sale as FRS has been met when the lawyer seek clearance from CPFB.