CPF Accounts Value thread

[Nofear40]

i decoupled with my wife and mom on my condo.
i bought a hdb using my mom's name.
my wife is homeless. she also agreed.

we take ourselves as one unit. as long as there is benefit to this unit, we will do it.

Curious- may I know why do you need to decouple with your wife on the condo since she is not buying any property?

 

[cal3135]

Agreed bro, let’s said not using surplus cash. Just talking about SA-> RA (if to move 88k to make ERS 176k)

Better to stay FRS or ERS with the Diff of 610/mth payout?

Compound interest 88k in SA for 10yrs be 131k.
131k divide by 610(diff per mth) will make it last for 17years. (82yo then)

Hence will think FRS be as good, not necessary move up to ERS.

The top up of RA from FRS to ERS need NOT come from your SA even if you have money in your SA. You can use cash to top up, assuming that you have surplus cash.

In another words, your surplus cash has the opportunity to earned 4% interest in RA. The flip side is that it gets locked up until 65 when it is paid out as part of your CPFLife.

Posted with xsmax HardwareZone Forums app

 

[dork32]

Curious- may I know why do you need to decouple with your wife on the condo since she is not buying any property?

when we decoupled, i bought a hdb for my mom

you think i got so much cash as to buy so many property at one go?

i need years to build up my savings to build up enough for another shot. we are almost ready for another with my wive's name.

since we were decoupling, might as well do it at one time.

 

[dork32]

Agreed bro, let’s said not using surplus cash. Just talking about SA-> RA (if to move 88k to make ERS 176k)

Better to stay FRS or ERS with the Diff of 610/mth payout?

Compound interest 88k in SA for 10yrs be 131k.
131k divide by 610(diff per mth) will make it last for 17years. (82yo then)

Hence will think FRS be as good, not necessary move up to ERS.

Posted with xsmax HardwareZone Forums app

sa vs ers, of course i will choose sa.

but many times it is oa vs ers. there is no right or wrong which one to choose. one has a flexibility to withdraw, the other has a higher interest.

 

[dork32]

Compound interest 88k in SA for 10yrs be 131k.
131k divide by 610(diff per mth) will make it last for 17years. (82yo then)

Posted with xsmax HardwareZone Forums app

you calculation above is very wrong. the reason is over the 17 years, you 131k (or whatever is left of it) will be earning interest.
at the start, 131k will be earning 436 interest a month. this is very significant compared to the 610. it means that you are withdrawing mostly from your interest, very little from the principal.
as such your 131k can last very much longer than 17 years. it will take 31 years to finish drawing it.
use this formula instead
=NPER(0.04/12,610,-131000,0)/12

 

[tangent314]

Let say I top up to ERS at 55 in my RA. It will continue to earn interest. Then, at 65, can I switch to FRS, and take out the balance ERS - FRS?

You can withdraw from your RA anything above the FRS between the age of 55 and when you begin the CPF Life payouts

If I TOP up gradually using cash, will this be entitled to tax relief up to 7k?

You cannot get tax reliefs once you reach the FRS.

 

[SKenny]

sa vs ers, of course i will choose sa.

but many times it is oa vs ers. there is no right or wrong which one to choose. one has a flexibility to withdraw, the other has a higher interest.

I will also choose SA over RA.

However I prefer to have more RA than OA or cash.

It is very hard (read almost impossible for now) to find a 4% return on your cash with the same low risk as the RA.

 

[SKenny]

You can withdraw from your RA anything above the FRS between the age of 55 and when you begin the CPF Life payouts
.

I believe the RA monies is "stuck" there till you withdraw them as part of CPFLife.

The only portion that you can withdraw is when you pledge your property.

 

[dork32]

hi bbc,

i understand that you mentioned that car loan interest is 1.9% is worth taking.

car loan in sg in calculated this way. i take it as 2% for easy calculations.
eg a car loan of 100k at 2% for 5 years.

Interest = 100k * 0.02 * 5 =10k
interest + principal = 100+ 10 = 110k
Installment = 110k/5/12 =1833/month
if you use =RATE(5*12,1833,-100000,0)*12 = 3.81%

 

[cal3135]

Bro, i use this scenario; SA stays at 88k for easy comparison on 55yo onward.

On 55yo, should i do FRS or ERS ? Below be FRS.

At 55yo SA:88k RA:176(FRS)
At 65 yo SA:131k RA: goes CPFLIFE

131k with 610 diff per mth, will able to drawdown for 17yrs. Then I be 82yo....

Hence.. may not be bad idea to stay on FRS

you calculation above is very wrong. the reason is over the 17 years, you 131k (or whatever is left of it) will be earning interest.
at the start, 131k will be earning 436 interest a month. this is very significant compared to the 610. it means that you are withdrawing mostly from your interest, very little from the principal.
as such your 131k can last very much longer than 17 years. it will take 31 years to finish drawing it.
use this formula instead
=NPER(0.04/12,610,-131000,0)/12

Posted with xsmax HardwareZone Forums app

 

[zuppeur]

If I choose bhs with property pledge @55.
Am I still able to top up to FHS using cash?

 

[SKenny]

Let say I top up to ERS at 55 in my RA. It will continue to earn interest. Then, at 65, can I switch to FRS, and take out the balance ERS - FRS?

Don't think you have this option.

Any topup monies is "stuck" in your RA until the CPFLife starts.

However part of the initial RA amount can be withdraw via the pledging of property scheme. There is also an option to withdraw 20% at age 65.

 

[dork32]

Bro, i use this scenario; SA stays at 88k for easy comparison on 55yo onward.

On 55yo, should i do FRS or ERS ? Below be FRS.

At 55yo SA:88k RA:176(FRS)
At 65 yo SA:131k RA: goes CPFLIFE

131k with 610 diff per mth, will able to drawdown for 17yrs. Then I be 82yo....

Hence.. may not be bad idea to stay on FRS

Posted with xsmax HardwareZone Forums app

you calculation is good except for this step
131k with 610 diff per mth, will able to drawdown for 17yrs. Then I be 82yo....

the correct statement should be
131k with 610 diff per mth, will able to drawdown for 31yrs. Then I be 96yo....

 

[SKenny]

Actually there’s no age limit to this decision (as long as you’re alive), but, as Tangent314 has explained, you miss out on some of the attractive 4% interest if you don’t top up within the month of your 55th birthday.

I stand corrected.

You can top up RA beyond 65. However the ERS limit is "cast in stone" at the point when you turn 65.

Note that ERS limit exclude interest earned. Therefore you can end up with amount in your RA exceeding the prevailing ERS.

 

[SKenny]

If I choose bhs with property pledge @55.
Am I still able to top up to FHS using cash?

Yes you can.

https://www.areyouready.sg/YourLife...s-you-need-to-know-when-you-turn-55-CPFB.aspx
4. When will I need to decide to set aside Basic Retirement Sum (BRS), Full Retirement Sum (FRS) or Enhanced Retirement Sum (ERS)? Can I still top up anytime to qualify for higher payouts?

A few months before your 55th birthday, we will inform you of the payout choices depending on your CPF balances. The table below shows the different retirement sums and corresponding monthly payouts. You can choose to set aside the BRS, if you own a property and choose to pledge your property. The excess RA savings (excluding top-up monies, interest earned, and any government grants received) may be withdrawn if you have sufficient pledge/charge on the property.

If you wish to enjoy higher monthly payouts, you can transfer your SA and OA savings to your RA, or top up your RA with cash anytime. From January 2016, the maximum amount of savings you can have in your RA is capped at ERS.

 

[ocs_woodlands]

I am a yield sucker (when it comes to retirement planning)..

I want to put as much money as possible into accounts guaranteeing me a 4% yield and hence it will be max in RA AND SA (ERS). and for my wife too

 

[zuppeur]

Don't think you have this option.

Any topup monies is "stuck" in your RA until the CPFLife starts.

However part of the initial RA amount can be withdraw via the pledging of property scheme.

Suppose I top up using cash from FRS to ERS. Pledge my property, Does it mean I can withdraw 50% FRS.

Can this fund be park in the RA account earning 4% interest?

can it be withdraw as and when or has to withdraw the full amount out

 

[SKenny]

Does it mean 50% of the FRS can be withdraw with property pledge

Can this fund be park in the RA account can be withdraw as and when or has to withdraw the full amount out

Yes to your first question.

Not sure about your second question. The reason why you want to pledge your property is to withdraw upto 50% of FRS. If you intend to park the fund in RA from the start, then why pledge your property?

Please note that you can choose to pledge your property at a later date beyond 55 until when your CPFLife starts.

 

[SKenny]

I am a yield sucker (when it comes to retirement planning)..

I want to put as much money as possible into accounts guaranteeing me a 4% yield and hence it will be max in RA AND SA (ERS). and for my wife too

Me too.

I ensure we have max top-up to our MA as well.

 

[alt2015]

Don't think you have this option.

Any topup monies is "stuck" in your RA until the CPFLife starts.

However part of the initial RA amount can be withdraw via the pledging of property scheme.

Can draw out 20% of RA at age 65?