CPF Accounts Value thread

[SKenny]

I did not say you cannot make VC, the keyword is "anytime" you like. That guy is thinking you can use CPF like bank account which is not true. When you withdraw, money come from SA, when you top up VC, it goes into all 3. You can't decide where the money goes so how is it like a bank account? That's my point.

You can still use CPF "like a bank" without touching the principal in your SA, if you keep the withdrawal below a certain limits.

The schedule of withdrawal from CPF is;
- Interest earned in the same year of your SA
- Interest earned in the same year of your OA
- Contribution of the same month into your SA
- Contribution of the same month into your OA
- the principal in your SA
- the principal in your OA

 

[SBC]

You can still use CPF "like a bank" without touching the principal in your SA, if you keep the withdrawal below a certain limits.

The schedule of withdrawal from CPF is;
- Contribution of the same year into your SA
- Contribution of the same year into your OA
- Interest earned in the same year of your SA
- Interest earned in the same year of your OA
- the principal in your SA
- the principal in your OA

Uncle Jin li hai. When is CPF issuing ATM card? Think there is PayNow with CPF now.

 

[kehyi4]

You can still use CPF "like a bank" without touching the principal in your SA, if you keep the withdrawal below a certain limits.

The schedule of withdrawal from CPF is;
- Contribution of the same year into your SA
- Contribution of the same year into your OA
- Interest earned in the same year of your SA
- Interest earned in the same year of your OA
- the principal in your SA
- the principal in your OA

Hi Uncle K, where did you get this info from? My understanding was that interest earned was first in the sequence of withdrawal:

CPF used to include the following in their FAQ, but I can't find it there anymore:

"Please note that the Board processes all withdrawals for members who are 55 and above, using the following deduction sequence:
i) interests earned in the Special Account, then Ordinary Account, from the beginning of the year up to the month before the withdrawal, followed by
ii) contribution/refunds credited to the Special Account, then Ordinary Account, in the same month of the withdrawal, and lastly,
iii) monies in the Special Account, then Ordinary Account."

 

[peacefulday]

But do not do this unless you are reasonably confident you will have enough room below the CPF Annual Limit ($37,740) this year. If you bust the CPF Annual Limit then your MA top-up will be refunded without interest.

I believe this can be worked out mathematically based on the CPF contribution rate and work out the gross pay per month for topup up the $2.7k.

Whether you can hit 37740 depends on your pay AND your bonus.

Is it too late to vc the $2.7k to MA now?

Can VC 2.7k to MA before Dec contribution is credited to MA in Jan.

Based on the cpf OW ceiling, capped at $6k; cpf monthly contribution x37% = capped @ $2.2k monthly. You need x17mth to hit out cpf AL $37740. You can calculate yourself.

What is the Ordinary Wage ceiling?
The Ordinary Wage (OW) Ceiling limits the amount of OW that would attract CPF contributions. The OW Ceiling is capped at $6,000 currently. For example, if an employee’s OW for a calendar month is $6,500, his CPF contribution would be computed based on an OW of $6,000; CPF contribution is not required on the remaining $500.

 

[SKenny]

Hi Uncle K, where did you get this info from? My understanding was that interest earned was first in the sequence of withdrawal:

CPF used to include the following in their FAQ, but I can't find it there anymore:

"Please note that the Board processes all withdrawals for members who are 55 and above, using the following deduction sequence:
i) interests earned in the Special Account, then Ordinary Account, from the beginning of the year up to the month before the withdrawal, followed by
ii) contribution/refunds credited to the Special Account, then Ordinary Account, in the same month of the withdrawal, and lastly,
iii) monies in the Special Account, then Ordinary Account."

The sequence is how I always remember it to be. You could very well be correct that the interest portion is withdrawn first.

I also cannot find it in CPF website anymore. Looks like this info has been removed. hmmm....

 

[peacefulday]

My interest.

Old uncle, got RA

You can still use CPF "like a bank" without touching the principal in your SA, if you keep the withdrawal below a certain limits.

The schedule of withdrawal from CPF is;
- Contribution of the same year into your SA
- Contribution of the same year into your OA = VC $37740
- Interest earned in the same year of your SA = $3,479.86
- Interest earned in the same year of your OA = $26,393.42
- the principal in your SA
- the principal in your OA

the withdrawal limit refer to the highlight 'red'?
if no contribution for that year, withdrawal sequence will start from SA -> OA interest? That's great!

 

[focus1974]

You can still use CPF "like a bank" without touching the principal in your SA, if you keep the withdrawal below a certain limits.

The schedule of withdrawal from CPF is;
- Contribution of the same year into your SA
- Contribution of the same year into your OA
- Interest earned in the same year of your SA
- Interest earned in the same year of your OA
- the principal in your SA
- the principal in your OA

WTF...my money want to withdraw also must have so many rules and so complicated...

I rather just emptied CPF and buy a property with it

 

[SKenny]

the withdrawal limit refer to the highlight 'red'?
if no contribution for that year, withdrawal sequence will start from SA -> OA interest? That's great!

The sequence is likely to be "interest is deducted before contribution" as pointed out by kehyi4.

Also I realised that I made a mistake in that the contribution is only the amount made in the same month as the withdrawal.

 

[kehyi4]

Based on the cpf OW ceiling, capped at $6k; cpf monthly contribution x37% = capped @ $2.2k monthly. You need x17mth to hit out cpf AL $37740. You can calculate yourself.

What is the Ordinary Wage ceiling?
The Ordinary Wage (OW) Ceiling limits the amount of OW that would attract CPF contributions. The OW Ceiling is capped at $6,000 currently. For example, if an employee’s OW for a calendar month is $6,500, his CPF contribution would be computed based on an OW of $6,000; CPF contribution is not required on the remaining $500.

You don't really need 17 mths - if your bonus is fat enough, 1 month bonus can 1 shot burst the Additional Wage component for the Annual Limit

 

[SKenny]

You don't really need 17 mths - if your bonus is fat enough, 1 month bonus can 1 shot burst the Additional Wage component for the Annual Limit

Previously the cap on the CPF contribution for bonus wasn't there. What a waste.

 

[peacefulday]

You don't really need 17 mths - if your bonus is fat enough, 1 month bonus can 1 shot burst the Additional Wage component for the Annual Limit

but the OW monthly ceiling still capped @$6k, bonus need spread for 5 separate months to hit .

 

[kehyi4]

but the OW monthly ceiling still capped @$6k, bonus need spread for 5 separate months to hit .

Because CPF Annual limit is made up of
* Ordinary Wage (max $6k x 12, ie $72k) and
* Additional Wage ($102k - OW, ie $30k if OW is maxed)

AW is not subject to the $6k per mth limit

Imagine your boss gave you a $30,000 bonus in Jan and no other bonus for the rest of the year. You would have hit your AW straightaway in Jan, no need 5 mths

 

[badsector]

CPF very crafty in calculating their interest

1. interest base on lowest balance of the month
2. Any deduction(Housing/medishield) all happens before monthly contribution.

sorry. let me kpkb here once

 

[crimsontactics]

CPF very crafty in calculating their interest

1. interest base on lowest balance of the month
2. Any deduction(Housing/medishield) all happens before monthly contribution.

sorry. let me kpkb here once

For Part 2, your employer can choose the date to pay your CPF.

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[Dividends Warrior]

WTF...my money want to withdraw also must have so many rules and so complicated...

I rather just emptied CPF and buy a property with it

That's my plan!
Going to wipe out my OA for property

 

[badsector]

For Part 2, your employer can choose the date to pay your CPF.

Sent from . using GAGT

agree. but we have no control.

 

[focus1974]

That's my plan!
Going to wipe out my OA for property

You are on the right track buddy!
No worries .. because if you are going to lock up CPF for 30yrs, it's better to just locked it up in property for 30yrs.

Property gives you better capital gain thru leverage and real cash (controlled by you) thru rental income after loan is paid off.

During that 30yrs, you could be able to cash out and downgrade your home and many other options . Your money, Your idea, Your Rules!

 

[crimsontactics]

You are on the right track buddy!
No worries .. because if you are going to lock up CPF for 30yrs, it's better to just locked it up in property for 30yrs.

Property gives you better capital gain thru leverage and real cash (controlled by you) thru rental income after loan is paid off.

During that 30yrs, you could be able to cash out and downgrade your home and many other options . Your money, Your idea, Your Rules!

Not really true. Property prices not guaranteed to rise all the way, unlike CPF.

Not saying that using CPF to invest in property is wrong, but it is not for everyone. Depends on your risk profile.

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[rrr2015]

good info thanks!

about "Interest earned in the same year", does that means interests earned in previous year?

are we allow to withdraw monthly?

You can still use CPF "like a bank" without touching the principal in your SA, if you keep the withdrawal below a certain limits.

The schedule of withdrawal from CPF is;
- Interest earned in the same year of your SA
- Interest earned in the same year of your OA
- Contribution of the same month into your SA
- Contribution of the same month into your OA
- the principal in your SA
- the principal in your OA

 

[crimsontactics]

good info thanks!

about "Interest earned in the same year", does that means interests earned in previous year?

are we allow to withdraw monthly?

You are allowed to withdraw monthly.

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