CPF chats

[Conor McGregor]

Hi bros and sis

Any advice is welcome on what should I do to maximize my cpf monies

OA - 208K
SA - 72K
MA - 60K

 

[Kaypohji]

How much do u guys usually top up sa with cash?

Do u top up over the years that accumulate to 100k? One year 7k 10 years would be 70k already

 

[luvpraline]

I interpret it as:
1. If the remaining amount is still in SA (after FRS met and transferred to RA at 55), even if it came from cash top up, you can withdraw the amount.
2. If you did cash top up with RSTU to SA, after RA is formed, and you do property pledge so that you can keep only BRS in RA and you want to withdraw the difference, you cannot do so if the top up amount was through cash top up. See the FAQ and the illustration: (c) -(b) -(d) for member B.

Can the experts confirm or correct my statement?

This is my interpretation as well. Experts, pls correct us if we're wrong.

The exceptions to withdrawing cash top ups from SA are for the following situations:

Withdrawal for
(i) Members who own a property and wish to withdraw RA savings above
their BRS through sufficient CPF property charge or pledge
(ii) Members who wish to withdraw RA savings above their BRS for housing
(iii) Members who wish to transfer RA savings above their BRS to their
spouse’s CPF account, under the Retirement Sum Topping-Up scheme

 

[vsvs24]

Why the below date 29th Jun?

https://www.cpf.gov.sg/members/FAQ/...uted monthly,the transactions in your account

CPF interest is computed monthly. It is then credited to your respective accounts and compounded annually. CPF interest earned in the year will be credited to your CPF accounts by 1 January of the following year.

CPF balances used for interest computation are affected by the transactions in your account.

For instance, contributions (including refunds) received this month start earning interest next month. Withdrawals/deductions in this month will not earn interest from this month onwards

----

So, contribute near mth end rather than beginning of mth. Let your cash earn bank interest in the month. You don't get more CPF interest by contributing at beginning of mth.

And pay by paynow so that it is real time update. This way you can contribute closer to month end. If pay by enets debit it takes about 3 days to post.

 

[vsvs24]

Agree. Cash into CPF is one way ticket. Unless your are near to 55.
Cash can park somewhere else, not that difficult to get 2.5%.
When you need cash, you can take out sooner and easier.

Can advise where to get 2.5%.

 

[terence2112]

Hi bros and sis

Any advice is welcome on what should I do to maximize my cpf monies

OA - 208K
SA - 72K
MA - 60K

Intending to purchase a ppty? Or say intending to buy another ppty? If so, you need to have the BRS in your SA. Once that is achieved, what you see in your OA can be used.

Currently, the BRS I think is 90k?

 

[BBCWatcher]

Cash can park somewhere else, not that difficult to get 2.5%.

Well, currently Singlife is paying 2.5% interest on a S$10,000 deposit. But otherwise it is rather difficult to get 2.5% interest on cash in a safe vehicle. (Singlife is SDIC insured.)

I interpret it as:
1. If the remaining amount is still in SA (after FRS met and transferred to RA at 55), even if it came from cash top up, you can withdraw the amount.

Correct.

2. If you did cash top up with RSTU to SA, after RA is formed, and you do property pledge so that you can keep only BRS in RA and you want to withdraw the difference, you cannot do so if the top up amount was through cash top up.

The use of cash to top up a Special Account only ever matters for age 55+ withdrawals if you try to reduce your Retirement Account below the Full Retirement Sum. But you really shouldn't do that. Financially speaking, that's like stabbing yourself in the eye.

However, yes, for the record, if you want to reduce your Retirement Account down as low as the Basic Retirement Sum (with a sufficient property pledge or charge), cash top ups plus interest on that cash raise that minimum retention. For example, if you add $7,000 to your SA, and by age 55 that turns into $8,000 ($7,000 plus $1,000 accrued interest), then you have to keep at least BRS+$8,000 in your RA, not BRS only.

That's the basic idea, but to repeat this distinction never matters AT ALL unless your future self tries to reduce your (still too meager) CPF LIFE retirement income stream by reducing your Retirement Account below the FRS.

Hi bros and sis
Any advice is welcome on what should I do to maximize my cpf monies
OA - 208K
SA - 72K
MA - 60K

Well, how big an OA "buffer" do you need? If for example you have $1 million in cash, $208K in OA, and a $1,500/month mortgage, then most people would transfer as much as they're allowed from OA to SA, and also OA funds into their spouse's and/or elder's SA/RA. Because you just don't need OA as OA in that scenario, so you might as well enjoy higher interest.

How much do u guys usually top up sa with cash?

Do u top up over the years that accumulate to 100k? One year 7k 10 years would be 70k already

"It depends," but the $7,000/year for tax relief is nice to collect. But there are a few scenarios when more can make a lot of sense.

 

[8zaoyu]

Hi bros and sis

Any advice is welcome on what should I do to maximize my cpf monies

OA - 208K
SA - 72K
MA - 60K

Very good, keep contributing with PayNow at month end, any amount. Under My Messages or each Account it may tell you the maximum you can keep contributing. Nowadays, youngsters are self-employed in "self businesses" Of course now with Covid - sad if no incomes now.This groups were previously too busy till now to look at their January Statement to see the interests earned and understand the meaning of "compound interest"which means interest on interest earned. If I started work at 20 and stop working at 65, It will be 45 years with compound interest. The draw down date is only from 65 years. Anyway, those who did investments with their OA/SA or still under mortgagel will have less in their CPFs. And if u if yr dependents need to pay hospitalisations, the maxed MA of 60k may be insufficent. Take care and take the max. Out at 65/70 draw down, so as not be a burden to your loved ones, that's for me

 

[TANKOKBENG]

 

[BBCWatcher]

U just need to read this chicken and duck debate, where he insisted he was right about his own legal interpretation of IRAS Act, that CPF website is wrong, throw nasty remarks at others till the end of the discussion, regardless of written proof provided to him that he was wrong! And cause infractions on me!

It’s because you’re tedious. The tax code (IRAS) literally says that giver and receiver must be the same for MediSave tax relief. (Cited, with a link to the tax code.) In practice receivers are getting MediSave tax relief too regardless of giver. Out of an abundance of caution I advise following the tax code. I obviously cannot force anyone to follow my advice.

There is no contradiction here! It’s all primary school level logic.

 

[maple96]

It’s because you’re tedious. The tax code (IRAS) literally says that giver and receiver must be the same for MediSave tax relief. (Cited, with a link to the tax code.) In practice receivers are getting MediSave tax relief too regardless of giver. Out of an abundance of caution I advise following the tax code. I obviously cannot force anyone to follow my advice.

There is no contradiction here! It’s all primary school level logic.

Thank you for admitting and acknowledging that your knowledge, understanding, interpretation and english command is only at primary school level.

I am at Degree Level, who have studied IRAS Act in the local university. No wonder all the chicken and duck debate. Shall not continue with primary level.

 

[BBCWatcher]

This is a sweeping wrong statement of CPF rules.

No, it’s not. As anybody who can read can see, the CPF Board makes an even more sweeping statement than I did. The CPF Board doesn’t qualify its introductory statement on its Web site to exclude any 55 year old members. I did, as a courtesy and in the interests of accuracy.

“Practically everyone” is not everyone. As examples, if you have $10 total in your CPF accounts at age 55 then you cannot withdraw $5,000. If your grandmother deposited the Full Retirement Sum in your Special Account when you were born then you won’t be withdrawing from your future Retirement Account. (Although you’ll have gobs extra in your Special Account.)

 

[maple96]

No, it’s not. As anybody who can read can see, the CPF Board makes an even more sweeping statement than I did. The CPF Board doesn’t qualify its introductory statement on its Web site to exclude any 55 year old members. I did, as a courtesy and in the interests of accuracy.

“Practically everyone” is not everyone. As examples, if you have $10 total in your CPF accounts at age 55 then you cannot withdraw $5,000. If your grandmother deposited the Full Retirement Sum in your Special Account when you were born then you won’t be withdrawing from your future Retirement Account. (Although you’ll have gobs extra in your Special Account.)

There he go again, write to mislead, dun waste my time.

Bye guys.

 

[BBCWatcher]

The MediSave tax relief citation is the Income Tax Act (as amended), 39(2)(q) for those who would like to read it. One person is correct on the facts, and the other is mistaken (and tedious).

 

[Andrew833]

Can advise where to get 2.5%.

Reits - Good reits.

 

[Andrew833]

Intending to purchase a ppty? Or say intending to buy another ppty? If so, you need to have the BRS in your SA. Once that is achieved, what you see in your OA can be used.

Currently, the BRS I think is 90k?

BRS is half of FRS.

 

[testingabc]

Reits - Good reits.

Can I know which platform? Syfe? FSM? Sorry I noob

 

[SBC]

Hi bros and sis

Any advice is welcome on what should I do to maximize my cpf monies

OA - 208K
SA - 72K
MA - 60K

Looks like you are in early to mid 30’s. Congrats to your good pay.

Can do small amount of OA to SA top up yearly, depending on your immediate property needs. If no immediate needs over the next 5 years, top up max of 7k.

 

[oceanicmanta]

hi maple, i don't understand this part.
Do u mind explaining it again? Thanks

perhaps could be referring exiting CPF Life in event of Terminal Illness.

https://www.cpf.gov.sg/members/FAQ/... you will receive,the form of monthly payouts.

though this shld apply to all 3 LIFE plans, perhaps Basic (with just 10-20% upfront premium deducted), one is more assured of getting back the remaining 80% ?

 

[peppermint7]

Can I know which platform? Syfe? FSM? Sorry I noob

Im not sure if he's referring to REITs ETF. But reits in Singapore stock market trading at a low price can fetch as high as 8 to 10% in dividend depending on how low the price u buy them in. Also whether the companies are able to continue to pay such dividends year by year.
But the risk is High for stock market. Only go for it if u have excess cash and am willing to take the risk. Taking the risk means u be prepared to lose part or even all of the principal sum put in. Or able to accept if companies are unable to pay out dividends as usual.