CPF Accounts Value thread

[THEMIKOS]

I think this statement is not true. Go to the streets and see how many people are earning/contributing pittance in their SA. With their mortgage payments fully from OA and their MA yet to even reach the max, they will never reach the FRS unless they get a drastic increase in their salary or get a windfall (settle their mortgage in full or top up their SA).

The minor vocal group that always claim #returnourcpf are probably in debt, anti-government or do not appreciate the value the abilities of what the CPF system can do. I was once a non-believer but after doing some reading the past few years, i am now a firm believer of its goodness.

In fact if u look at it from another angle, the govt is kinda smart in that they make us save the minimum sum and pay us a "pension" for as long as u live after CPF Life kicks in. The only challenge here is the ability to live for as long as possible to get maximum gains out of your contribuition. A person's life expectancy has varying sentiments i am sure as some would prefer to die at a certain age rather than live till okd and sickly.

As what one forummer (i believe its dork32) explained, one would need to live till 96 to fully "earn" back his returns. My question would be, what if at aged 80 i pass away. Will there be money to be passed on to my children? If so, is it (principal plus interest earned till that point MINUS total payout till death stole me away)??

pray tell where you got this figure from

 

[Midlifecrisis]

Ya lor. “Lost” a lot that I had missed the boat on private property rise in 2010.

Hope HDB will rise when Cross Island line is built there.

I managed to catch the boat on private property rise in 2010 but really regret selling my HDB as I was tempted with a COV of 80K for my ulu HDB. Only recently managed to buy a condo unit which probably return me 3% vs 5% rental yield for HDB. Totally wipe out my OA.

 

[Nofear40]

I think this statement is not true. Go to the streets and see how many people are earning/contributing pittance in their SA. With their mortgage payments fully from OA and their MA yet to even reach the max, they will never reach the FRS unless they get a drastic increase in their salary or get a windfall (settle their mortgage in full or top up their SA).

The minor vocal group that always claim #returnourcpf are probably in debt, anti-government or do not appreciate the value the abilities of what the CPF system can do. I was once a non-believer but after doing some reading the past few years, i am now a firm believer of its goodness.

In fact if u look at it from another angle, the govt is kinda smart in that they make us save the minimum sum and pay us a "pension" for as long as u live after CPF Life kicks in. The only challenge here is the ability to live for as long as possible to get maximum gains out of your contribuition. A person's life expectancy has varying sentiments i am sure as some would prefer to die at a certain age rather than live till okd and sickly.

As what one forummer (i believe its dork32) explained, one would need to live till 96 to fully "earn" back his returns. My question would be, what if at aged 80 i pass away. Will there be money to be passed on to my children? If so, is it (principal plus interest earned till that point MINUS total payout till death stole me away)??

How is the magic number 96 derived?

 

[madtari]

I believe is by taking ERS/FRS/BRS divided by the monthly amount under cpf life and you will know how many months u need to withdraw b4 u will hit the total amount u have put in.

How is the magic number 96 derived?

 

[JuniorLion]

With so many people easily hitting ERS, it's only a matter of time before the rules are tweaked again...

What does this even mean? Do you mean to say that rules were tweaked previously to prevent people from hitting retirement sums? Otherwise, do clarify what you actually mean.

 

[dork32]

Why not just use cash? Ensure all money in cpf earning interest.

if you have so much cash, by all means.

most of us dont

 

[dork32]

How is the magic number 96 derived?

cal gave the numbers.

131k of principal at sa at a payout of 610 month gives you 31 years

 

[BBCWatcher]

What about If I want to top up to ERS? Can I move my OA and leave SA intact? Assuming I still have SA balance after transfer to RA to form FRS

Yes you can.

Only if you raise a Special Account "shield," which is a "hack" that is available now but might not always be available. Otherwise if you transfer funds into your Retirement Account they'll be drawn first from your Special Account then, when your Special Account is empty, from your Ordinary Account. This SA/OA to RA transfer is merely a convenience transaction that CPF offers, but it's not any different (except for tax relief if you're below the FRS) than a SA/OA withdrawal followed by a RA deposit.

You can even use cash and leave both your OA and SA intact.

That's generally the best move.

If you really want to use mostly OA funds to top up your Retirement Account, then the best you can do is something like this:

1. Just before your 55th birthday, raise a Special Account shield so that your RA is formed mostly from your Ordinary Account funds. (Make a cash OA loan repayment before your 55th birthday to jack up your OA if you don't have enough, and if eligible.)

2. Then, after the RA is formed, and with the SA shield still raised, transfer from OA into your RA.

3. Then lower the SA shield, to return the shielded funds back to your SA.

 

[ELKYme]

If you really want to use mostly OA funds to top up your Retirement Account, then the best you can do is something like this:

1. Just before your 55th birthday, raise a Special Account shield so that your RA is formed mostly from your Ordinary Account funds. (Make a cash OA loan repayment before your 55th birthday to jack up your OA if you don't have enough, and if eligible.)

2. Then, after the RA is formed, and with the SA shield still raised, transfer from OA into your RA.

3. Then lower the SA shield, to return the shielded funds back to your SA.

Learned this ‘hack’ from you and appreciate it. Definitely worth doing for anyone that has >40K in their SA account as it’s 1.5% extra interest.

 

[kellogs]

Is there anyway to top up cpf accounts after FRS and VC done? I am looking to top them up so total value is 1M sgd. 40yo

Sent from Samsung SM-N960F using GAGT

 

[student_sdu]

Return the loan to OA,
Or wait for cpfb to increase the AL.

Is there anyway to top up cpf accounts after FRS and VC done? I am looking to top them up so total value is 1M sgd. 40yo

Sent from Samsung SM-N960F using GAGT

 

[kellogs]

I did not use OA for any loan and currently it has 300kish 176k for SA and 57k for MA. I have a liquid of 500k which i am hoping to pump into CPF for maximum compound interests

Sent from Samsung SM-N960F using GAGT

 

[BBCWatcher]

Is there anyway to top up cpf accounts after FRS and VC done? I am looking to top them up so total value is 1M sgd. 40yo

Once your Special Account has reached the Full Retirement Sum then you cannot top up your Special Account -- you're done. But you can top up somebody else's Special Account (or Retirement Account) if it's still below the limit, such as a spouse's.

You also have these options to jack up your CPF account balances, in no particular order:

1. If your MediSave Account has not reached the Basic Healthcare Sum, then you can top up your MediSave Account with tax relief. However, this top up must fit within the CPF Annual Limit ($37,740).

2. If you have some room below the CPF Annual Limit, then you can make an "all three" voluntary contribution to CPF which is distributed to your three accounts according to the normal allocation rules for your age. Use CPF Form VC/1 (or electronic equivalent) to do that. (If you're self-employed there's a different form, and your "all three" contribution enjoys tax relief.)

3. If you have used Ordinary Account funds for housing or other purposes, you can repay them, plus accrued interest.

4. You can work for an employer that offers additional MediSave top-ups. These particular additional top-ups are not limited by either the CPF Annual Limit or the Basic Healthcare Sum.

5. Earn more and stay employed, to hit the CPF Annual Limit consistently. Work with your employer to structure your income in a CPF friendly way. For example, if you're on straight salary of $8,000/month plus a traditional 13th month bonus equal to that straight salary, then you're not going to hit the CPF Annual Limit. (You'll miss by $8,140 in this example.) In this example you and your employer might agree on $6,800/month plus a $30,000 annual bonus, which would then hit the CPF Annual Limit. (The employer would have to pay a bit more in this example, but the employer might agree to that deal for cash flow reasons. I would also be careful to negotiate a severance equal to at least the accrued bonus.)

 

[seowyian]

In reply to Elkyme: This hack originated from icebeng : https://forums.hardwarezone.com.sg/...ter-55-possible-5657694-13.html#post109357308

 

[Duncallmebro]

If SA and MA have reached FRS and BHS respectively, would the whole of subsequent voluntary contributions be directed into OA?

Am planning to use OA shielding method to keep a buffer for HDB loan repayment and hope to periodically top up the OA using VC

 

[kehyi4]

What about If I want to top up to ERS? Can I move my OA and leave SA intact? Assuming I still have SA balance after transfer to RA to form FRS

Yes you can...

Erm, no you can't

CPF FAQ:
Q: Can I transfer my Ordinary Account to my own Retirement Account without affecting my Special Account?
A: If you are 55 and above, and you are performing a CPF transfer to your own Retirement Account, your Special Account savings will be transferred first, followed by your Ordinary Account savings.

 

[JuniorLion]

Erm, no you can't

CPF FAQ:
Q: Can I transfer my Ordinary Account to my own Retirement Account without affecting my Special Account?
A: If you are 55 and above, and you are performing a CPF transfer to your own Retirement Account, your Special Account savings will be transferred first, followed by your Ordinary Account savings.

Bbcw included how.

 

[OngHuatHuat]

He was using 4 % + 1 % + 1 % during the payout period to do the calculation, that’s can last till why 96 years old.

If you lower it to around 2.5 % interest during the payout period, it will be around 80 plus years old, so called age to fully earn back the returns.

Regardless of 2+ % or 4 + % interest, cpf life beats private annuity plan.

I think this statement is not true. Go to the streets and see how many people are earning/contributing pittance in their SA. With their mortgage payments fully from OA and their MA yet to even reach the max, they will never reach the FRS unless they get a drastic increase in their salary or get a windfall (settle their mortgage in full or top up their SA).

The minor vocal group that always claim #returnourcpf are probably in debt, anti-government or do not appreciate the value the abilities of what the CPF system can do. I was once a non-believer but after doing some reading the past few years, i am now a firm believer of its goodness.

In fact if u look at it from another angle, the govt is kinda smart in that they make us save the minimum sum and pay us a "pension" for as long as u live after CPF Life kicks in. The only challenge here is the ability to live for as long as possible to get maximum gains out of your contribuition. A person's life expectancy has varying sentiments i am sure as some would prefer to die at a certain age rather than live till okd and sickly.

As what one forummer (i believe its dork32) explained, one would need to live till 96 to fully "earn" back his returns. My question would be, what if at aged 80 i pass away. Will there be money to be passed on to my children? If so, is it (principal plus interest earned till that point MINUS total payout till death stole me away)??

 

[ELKYme]

Noted Bro. Credit must be given to iceberg too.

Hope this loophole will not closed by the time I hit 55 though.

In reply to Elkyme: This hack originated from icebeng : https://forums.hardwarezone.com.sg/...ter-55-possible-5657694-13.html#post109357308

 

[SKenny]

Noted Bro. Credit must be given to iceberg too.

Hope this loophole will not closed by the time I hit 55 though.

This hack sounds easier in theory than it is in practice.

One suggestion; try to try this earlier rather than wait till last minute.