CPF SA

[BBCWatcher]

*If* the government is going to reduce any CPF interest rates, my guess -- only a guess! -- is that they'd reduce the CPF OA rate before touching any other rates.

 

[battledome64]

This 1 can only speculate. By formula it wouldn't be 4% and government is sustaining it.

If you want speculation, I opine that if market interest is going to remain very low in the long term, then they might reduce it. as it is always relative.

If you have less than 20k in OA it’s 6% correct?

 

[tangent314]

Aside from this, anyone knows or thinks CPF is still able to sustain the 4% interest?

At the moment, based on latest GIC reports reporting 3.9% 5-year real rate of return, they should be okay. Yes this is slightly below the 4% (or 6% with bonus) they gave for SMRA, but a lot of it goes not only to OA, but also to normal SGS where they give much lower yields.

 

[BBCWatcher]

If you have less than 20k in OA it’s 6% correct?

Here's how you earn maximum bonus interest:

SA+MA+RA >= $60,000

-or-

SA+MA+RA+OA >= $60,000 *AND* SA+MA+RA >= $40,000.

 

[Trader11]

*If* the government is going to reduce any CPF interest rates, my guess -- only a guess! -- is that they'd reduce the CPF OA rate before touching any other rates.

The government will be voted out if they reduce interest rate. Singaporeans have too much skin in the game with cpf.

 

[RedsYWNA]

The government will be voted out if they reduce interest rate. Singaporeans have too much skin in the game with cpf.

I think people may be ok with reducing CPF OA, but not SA, given that the majority uses CPF OA for housing. Reducing OA means they dont need to pay so much to CPF when they sell their houses.

 

[reddevil0728]

I think people may be ok with reducing CPF OA, but not SA, given that the majority uses CPF OA for housing. Reducing OA means they dont need to pay so much to CPF when they sell their houses.

Is return money to themselves leh.

is not pay.

 

[RedsYWNA]

Is return money to themselves leh.

is not pay.

Haha yah yah, return money to themselves. Just that some of my friends dont see it that way.....hehehehe

 

[Cobra!]

Haha yah yah, return money to themselves. Just that some of my friends dont see it that way.....hehehehe

yes the trouble is the perception.

 

[reddevil0728]

Haha yah yah, return money to themselves. Just that some of my friends dont see it that way.....hehehehe

Well it might be arguable that CPF should do a better job at communicating, but it’s also for people to not be in denial and to be educated.

 

[8zaoyu]

Is return money to themselves leh.

is not pay.

Should rename OA as HL$ - housing loan $
As it will returned with interests back to ownselves only. When we wanted to pay all our brood's University Loans, CPF board said must all deduct Special Accounts first before OA. Anyway, kiddos graduate upon 23 or 25 yrs old only, during these years, probably sell one or two times of properties already - mainly was properties transactions returns. The CPF SA was own self-manupulations from young, spare OA transfers to SA, when all properties fully paid, all disciplined savings, bonuses put back to own SA and see 5 figure Interests every January! Social Security $ should just be called Pension $ and be given the max of 4 to 6 % from the 1st $. Let banks deals with the HDB or pte loans interest rates if drawing out from Social Security $ Account

 

[reddevil0728]

Should rename OA as HL$ - housing loan $
As it will returned with interests back to ownselves only. When we wanted to pay all our brood's University Loans, CPF board said must all deduct Special Accounts first before OA. Anyway, kiddos graduate upon 23 or 25 yrs old only, during these years, probably sell one or two times of properties already - mainly was properties transactions returns. The CPF SA was own self-manupulations from young, spare OA transfers to SA, when all properties fully paid, all disciplined savings, bonuses put back to own SA and see 5 figure Interests every January! Social Security $ should just be called Pension $ and be given the max of 4 to 6 % from the 1st $. Let banks deals with the HDB or pte loans interest rates if drawing out from Social Security $ Account

Too many things together.

what’s your point????

 

[Trader11]

I took 25 years loan from HDB and pay by cash every month. All my OA is transferred to SA. I have preexisting investment in equities. What should I do next to optimize my network for retirement?

 

[BBCWatcher]

I took 25 years loan from HDB and pay by cash every month. All my OA is transferred to SA. I have preexisting investment in equities. What should I do next to optimize my network for retirement?

A few typical ideas:

1. A Supplementary Retirement Scheme account if you're eligible for decent or better tax relief.

2. When you exhaust OA to SA transfer opportunities then you could look at OA to a qualified family member's (such as a spouse's) SA or RA. Thereafter the CPF Investment Scheme (OA) is a possibility.

3. "Preexisting investment in equities" suggests it's not a regular, repeated monthly/quarterly savings pattern. Ordinarily it should be.

4. You might decide at some point to refinance the HDB loan with a private market loan. The latter offers substantially lower interest rates -- currently 1.4% on a 5 year fixed rate mortgage, for example -- although there's a nonzero risk the private market interest rate could eventually rise above the 2.6% HDB concessionary loan rate.

 

[Trader11]

A few typical ideas:

1. A Supplementary Retirement Scheme account if you're eligible for decent or better tax relief.

2. When you exhaust OA to SA transfer opportunities then you could look at OA to a qualified family member's (such as a spouse's) SA or RA. Thereafter the CPF Investment Scheme (OA) is a possibility.

3. "Preexisting investment in equities" suggests it's not a regular, repeated monthly/quarterly savings pattern. Ordinarily it should be.

4. You might decide at some point to refinance the HDB loan with a private market loan. The latter offers substantially lower interest rates -- currently 1.4% on a 5 year fixed rate mortgage, for example -- although there's a nonzero risk the private market interest rate could eventually rise above the 2.6% HDB concessionary loan rate.

I heard about SRS often. But what are good assets to buy with SRS since it is restricted to Singapore markets

 

[zoneguard]

I heard about SRS often. But what are good assets to buy with SRS since it is restricted to Singapore markets

Not true, you cannot buy overseas stocks/ETFs directly with SRS but there are SRS offerings from both robos and brokers that cover overseas markets.

 

[8zaoyu]

Too many things together.

what’s your point????

Oops, sorry, after seeing what i said, i can't figure what was said. Too many tentacles

 

[Trader11]

How do you deal with having negative networth? Especially after being forced by family to take up a HDB loan

 

[reddevil0728]

How do you deal with having negative networth? Especially after being forced by family to take up a HDB loan

how is that negative?

 

[Trader11]

how is that negative?

Asset minus Liability = Negative Networth