CPF Account Value Thread 2025

[henrylbh]

Js do BRS or explore pte annuities to opt out CPFLife altogether?

Till kingdom comes.

Now CPF gets more tight and that has affected my retirement planning and projection adversely due to recent changes. The biggest injury is the cessation of paying interest accrued to the month preceding withdrawal and the closure of SA. Only good is the option to top-up RA 4x BRS especially for those under RSS. But that may not be attractive enough for those under CPFL as the bet gets bigger.

 

[henrylbh]

Alevin K. Chan at SingSaver writes:

Myth 6: CPF Life is compulsory​

Given the nature of our government plans and policies, you might think CPF LIFE is compulsory. The truth is, it isn’t.

Don't be a clown like Alevin to self con and expect others to agree. It is mandatory or compulsory say what suits you. Members got no choice and have to self console that it is not compulsory.

 

[8zaoyu]

Fully Agreed, since it started in 2009, they should have given those that already in CPF to decide on RSS or CPFlife and not 1958 onwards

If they had allow option to choose that, probably CPFlife would failed

Not failed but have the option of EITHER RSS for males, because longevity figures are different.
Those who are still Kings and Queens live longer.
Those who live in SG Company cannot really retire,
retire liao also have these "life" premiums.

 

[kelhot2001]

What a way to say that you're perfectly free to choose ... but not perfectly free to choose between RSS and CPFL. Waste of time to read the Board's exemption and links provided are as good as nothing.

Rich man daughter ask if she can marry anyone she want. The father replied that she can but provided the man have to have million dollar in asset and earn 200k a year to be qualify and subject to his approval. Else the father will choose the husband for her and she decide based on what her father decided for her or

1)She could disowned her father and be free to choose her partner

2) She choose based on her father criteria subject to her father approval

And yes, she is free to choose

From CPF

This is incorrect. You can choose to opt out from CPF LIFE, provided you:

Have a pension or private annuity plan that guarantees monthly payouts that are the same or higher than CPF LIFE;
Are aged 55 and above; and
Are both the policy holder and sole insured person of the annuity policy.
However, it can be difficult to find a private annuity plan that matches the security and steady monthly payouts offered by CPF LIFE. If you’re keen to learn more, you can read more about how to use CPF LIFE as the cornerstone of your retirement planning, which includes comparisons with other private annuity plans.

 

[chiokcc]

Best time of the month to top-up RA is end of the month to max the CPF interest so as to suffer less from lesser bank interest? Correct?

 

[BBCWatcher]

Best time of the month to top-up RA is end of the month to max the CPF interest so as to suffer less from lesser bank interest? Correct?

Almost always correct, I’d say.

There’s one exception I can think of. If your RA is near the current Full Retirement Sum (measuring your RA on a principal only basis), you’re trying to win some tax relief with your RA top up, and you need to beat a payroll cycle contribution that would be partially allocated to RA in order to get all the tax relief you’re trying to get. This scenario is probably most likely to occur (if it occurs) in your 55th birthday month and possibly also in the January following your 55th birthday year. And I think it only occurs if you didn’t meet the Full Retirement Sum on your 55th birthday. (If you did meet the FRS on your 55th birthday, payroll cycle contributions wouldn’t be apportioned to RA.)

Note that OA to RA transfers start accruing higher RA interest backdated to the first day of the month when the transfer occurs. CPF interest is computed monthly (not daily), so a transfer any time within the month works fine. I wouldn’t make that transfer too close to the end of the month. Sometimes (especially on first transfers) the CPF Board needs a few days to process the transfer.

On edit: I can think of another odd exception, and it might apply to wealthier households. Let’s suppose you have an employed spouse or partner who acquires Singapore Permanent Residence at age 57. (It’s fairly rare for older individuals to acquire PR, but when it occurs it’s typically for spouses of Singaporeans, perhaps in a 2nd marriage for the Singaporean.) You and he/she want to deposit as much as you can in this new PR’s new CPF accounts, let’s suppose. That means beating the spouse’s payroll cycle: deposit the FRS in the spouse’s RA, and deposit the BHS in the spouse’s MA, before the payroll cycle contributions hit. When that payroll cycle hits, all contributions (usually at the lower 1st year PR contribution rate) will then land in OA where they’re liquid. The couple then deposits the remainder (another amount equal to the FRS) in the new RA at the end of the same month. (Depositing the FRS earlier was enough to block the payroll cycle from being partially apportioned to RA.)

 

[ericcsn]

Best time of the month to top-up RA is end of the month to max the CPF interest so as to suffer less from lesser bank interest? Correct?

I go right to the end: 31 Jan. If 31 Jan is a Sunday, then I play safe and top up on 30 Jan. Until then the money will earn bank interest from 1st Jan up to 30th Jan (in the normal 31st Jan RA top up),

The other one I do is my MA:
top up to BHS on 2 Jan (before my salary comes in) and claim tax relief (and again for my and family hospitalisation insurance premium paid under my credit card. I top these up on dates before salary comes as soon as they are pulled from MA- again claim tax reliefs to max $8K. Can do similar for spouse max $8K. Same if you make hospitalization claims)

 

[koolkool]

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.

Thanks hendrylbh, BBCwatcher, royalmix for your inputs.

I see value in doing a FRS. 4% in RA, risk free, is quite good actually. It can form a safety net, and other investments can yield better returns, but these come with risks.

My plan now is to do FRS @ 55, and then do a VHR of all my outstanding housing loans. After which I will withdraw from my OA for other form of investments. At 65, I will then choose the basic plan for CPFL. I still have the flexibility to withdraw 20% of RA balance if needed. Hopefully I don't need to do that, and I think when I am 65, I should have stopped thinking about wealth accumulation and just enjoy my remaining life peacefully and let the investment run its course for my retirement.

 

[BBCWatcher]

My plan now is to do FRS @ 55, and then do a VHR of all my outstanding housing loans. After which I will withdraw from my OA for other form of investments.

Why? That maneuver makes absolutely no sense as far as I can tell. All you’d do with that maneuver is shut down the future option of depositing funds into a 2.5% interest earning liquid, government guaranteed, asset protected, on demand account. If that option should ever be comparatively attractive in the future, tough luck, you lit it on fire. Why? Why shut down that option (not obligation)? What’s the upside reward for closing off future access to such an account? I can’t think of any benefit. At best you’d be no worse off, but you certainly could be worse off.

Also, the Full Retirement Sum is merely a fairly arbitrary government default. If you prefer the Full Retirement Sum plus precisely $33,912, you can choose that. In other words, just evaluate CPF RA incremental dollar for incremental dollar. If the next $33,912 makes better sense in RA than elsewhere, but the 33,913th dollar doesn’t, OK, so be it.

 

[ZinY]

My plan now is to do FRS @ 55, and then do a VHR of all my outstanding housing loans.

Why? That maneuver makes absolutely no sense as far as I can tell. All you’d do with that maneuver is shut down the future option of depositing funds into a 2.5% interest earning liquid, government guaranteed, asset protected, on demand account.

@koolkool In fact, after you do FRS @ 55, you don't really need a big lump sum to do VHR of all your outstanding CPF money used for housing. You can do a VHR with some cash, withdraw back the same amount, and recycle back the same amount to VHR several times. You could have wiped out the VHR option in no time.
Why do you want to shut down that future option of 2.5% interest liquid account?

 

[swathe]

Is it a cheat code to VHR at 55 (if you hit FRS) and then yet can immediately take out what you owe?

 

[koolkool]

@koolkool In fact, after you do FRS @ 55, you don't really need a big lump sum to do VHR of all your outstanding CPF money used for housing. You can do a VHR with some cash, withdraw back the same amount, and recycle back the same amount to VHR several times. You could have wiped out the VHR option in no time.
Why do you want to shut down that future option of 2.5% interest liquid account?

Why? That maneuver makes absolutely no sense as far as I can tell. All you’d do with that maneuver is shut down the future option of depositing funds into a 2.5% interest earning liquid, government guaranteed, asset protected, on demand account. If that option should ever be comparatively attractive in the future, tough luck, you lit it on fire. Why? Why shut down that option (not obligation)? What’s the upside reward for closing off future access to such an account? I can’t think of any benefit. At best you’d be no worse off, but you certainly could be worse off.

Also, the Full Retirement Sum is merely a fairly arbitrary government default. If you prefer the Full Retirement Sum plus precisely $33,912, you can choose that. In other words, just evaluate CPF RA incremental dollar for incremental dollar. If the next $33,912 makes better sense in RA than elsewhere, but the 33,913th dollar doesn’t, OK, so be it.

Thanks for the comments, appreciate your fast responses.

I understand where you are coming from. It is a option to move cash -> OA to enjoy the 2.5% interest as and when we need, up to the housing loan amount. When we are in a low interest rate environment (which, in all likelihood, we are already in), we have the flexibility of using the OA as a HYSA.

My train of thought on doing a VHR is to wipe out the AI and the loan. As I understand, as long as I have a loan using CPF, I will have to pay for the CPF interest for that amount I owe myself. I was thinking why don't I do a refund, and then now CPF board pays me the CPF interest for my OA instead?

I was thinking I will not withdraw all I have from OA @55. I will allocate a portion as part of my cash portion, treating it like a HYSA, while another portion will go out to earn me better returns. If the SA shielding is still around, I may have a different strategy and likely keep more with CPF.

But I understand where you are coming from. Still thinking through how to have this VHR -> CPF option available. I welcome your inputs so that I can refine my strategy on this. Thanks again.

 

[DevilPlate]

@koolkool In fact, after you do FRS @ 55, you don't really need a big lump sum to do VHR of all your outstanding CPF money used for housing. You can do a VHR with some cash, withdraw back the same amount, and recycle back the same amount to VHR several times. You could have wiped out the VHR option in no time.
Why do you want to shut down that future option of 2.5% interest liquid account?

If a 55yo person have tons of cash like 1M+ sitting in bank accts earning <2.5% rn, just do lump sum VHR let say 300k-500k also Ok right?

Why need to so cham abit abit VHR….withdraw and then abit bit VHR? Whats the point?
Let say IR spike up can always use OA buy Tbills?

 

[BBCWatcher]

My train of thought on doing a VHR is to wipe out the AI and the loan. As I understand, as long as I have a loan using CPF, I will have to pay for the CPF interest for that amount I owe myself. I was thinking why don't I do a refund, and then now CPF board pays me the CPF interest for my OA instead?

I was thinking I will not withdraw all I have from OA @55. I will allocate a portion as part of my cash portion, treating it like a HYSA, while another portion will go out to earn me better returns.

What you describe still makes no sense. You’re still reducing the amount you could deposit in OA in the future. Why? What do you hope to gain by reducing your OA deposit cap?

In these circumstances (age 55+, met at least the Full Retirement Sum) the only logical reason for a voluntary housing refund is to keep the dollars you refund in OA for some period of time — earning 2.5% interest and protected from creditors and adverse court judgments. If those dollars go somewhere else you're just reducing how much you can deposit. Why would you take something of potential future value and destroy or damage it without any benefit?

 

[8zaoyu]

@koolkool In fact, after you do FRS @ 55, you don't really need a big lump sum to do VHR of all your outstanding CPF money used for housing. You can do a VHR with some cash, withdraw back the same amount, and recycle back the same amount to VHR several times. You could have wiped out the VHR option in no time.
Why do you want to shut down that future option of 2.5% interest liquid account?

Because IF you do not do Voluntary Housing Refund, even if one kid retains the HDB and other kids wants shares, the PLEDGE amount PLUS accrued interest have to collected back as ESTATE inheritance BEFORE shares of estate distribution.
BBC hopes for " no need to pay the flat liao " IF you die between 55 to 65 because got the Housing Dependants Protection Scheme ( a very low cost payable till 65 only ), so do not wish you to Voluntary Housing Refund! But Abang got many sons from 1 main wife and 3 side wives to continue adding name to the HDB, also no need to VHR!

 

[BBCWatcher]

Because IF you do not do Voluntary Housing Refund, even if one kid retains the HDB and other kids wants shares, the PLEDGE amount PLUS accrued interest have to collected back as ESTATE inheritance BEFORE shares of estate distribution.

False.

 

[hwmook]

Thanks for the comments, appreciate your fast responses.

I understand where you are coming from. It is a option to move cash -> OA to enjoy the 2.5% interest as and when we need, up to the housing loan amount. When we are in a low interest rate environment (which, in all likelihood, we are already in), we have the flexibility of using the OA as a HYSA.

My train of thought on doing a VHR is to wipe out the AI and the loan. As I understand, as long as I have a loan using CPF, I will have to pay for the CPF interest for that amount I owe myself. I was thinking why don't I do a refund, and then now CPF board pays me the CPF interest for my OA instead?

I was thinking I will not withdraw all I have from OA @55. I will allocate a portion as part of my cash portion, treating it like a HYSA, while another portion will go out to earn me better returns. If the SA shielding is still around, I may have a different strategy and likely keep more with CPF.

But I understand where you are coming from. Still thinking through how to have this VHR -> CPF option available. I welcome your inputs so that I can refine my strategy on this. Thanks again.

Stop obsessing over the accrued interest. Once you hit FRS and past 55, the accrued interest have no practical meaning at all. There is no obligation to payback the accrued interest at all so it exists as an option for you to do voluntary refund if you want to earn OA interest.

 

[BBCWatcher]

Please also note that CPF members age 55+ have at least four ways to save more in CPF:

1. You can top up your Retirement Account. Cash top ups may qualify for tax relief or matching dollars (the MRSS). The only limit is the Enhanced Retirement Sum. If you've previously met the ERS, every time the ERS is raised there's more room for another top up. RA earns 4.0+% interest, some lump sum withdrawals (of principal) are possible, and the rest feeds into lifetime retirement income (CPF LIFE).
2. You can make a Voluntary Contribution to your MediSave Account. Your VC to MA may qualify for tax relief. The only limit is the Basic Healthcare Sum. Your BHS is fixed for life on your 65th birthday. Every time there's a deduction from your MA there's room for a VC. MA earns 4.0+% interest. If your MA is at the BHS on December 31, MA interest for the year will be paid into your OA. Although CPF isn't a good bequest vehicle, if you're trying to bludgeon CPF into conveying a bequest (to your CPF nominees), MA works best for those purposes.
3. You can make an "all 3 account" Voluntary Contribution ("VC3A"). A VC3A may qualify for tax relief if you're self-employed. VC3As and compulsory contributions (combined) are limited to $37,740 per year (the CPF Annual Limit). Your VC3A will be apportioned to your CPF accounts according to the allocation percentages for your age bracket but subject to RA and MA limits. If you've met the FRS (or BRS with property pledge/charge) in your RA and the BHS in your MA, your entire VC3A will land in your OA.
4. ....And then there's repaying OA used for housing. OA repayment is often the least attractive way to increase your CPF savings because the interest rate is the lowest (2.5%) and the amount you can repay effectively has a finite, lifetime limit — in contrast to VC3As, for example, which are subject to a limit that resets every year.

Consider the first 3 ways to inject funds into CPF before you consider exercising the 4th option (OA repayment).

 

[DevilPlate]

Stop obsessing over the accrued interest. Once you hit FRS and past 55, the accrued interest have no practical meaning at all. There is no obligation to payback the accrued interest at all so it exists as an option for you to do voluntary refund if you want to earn OA interest.

I believe he js wana earn that 2.5% OA interest now and withdraw as he please.

 

[BBCWatcher]

I believe he js wana earn that 2.5% OA interest now and withdraw as he please.

If you intend to keep dollars in OA for some reasonable period of time, and there's no better way to get dollars into CPF (such as a VC3A which in many cases would land in OA), sure, great, repay some OA dollars used for housing and enjoy your 2.5% interest earning account. That makes sense as long as 2.5% OA does.

But that's not the predicate. Koolkool's idea was/is to repay OA dollars used for housing then quickly withdraw some (or previously all) for investment elsewhere. Depositing dollars in OA only to take them out quickly makes no sense at all. That would just reduce how many dollars you can deposit in OA in the future. Why would you ever reduce your future options with no upside and no reward? It's illogical.