CPF SA

[karakorum1999]

It's possible to have more than one employer. Each has a separate CPF Annual Limit.

I can vouch for that. There were a few years in the past when I did part time work (with blessing from my main employer) with a separate entity, and I was pleasantly surprised to see how the CPF contributions for 2nd employer work separately and independently from the 1st.

 

[zoneguard]

What else can be done to grow OA/SA? Investments? Thinking of using endowus.

What other methods to reduce tax? I have no kids and parents still working so can't claim parent relief.

Oh also a bit confused about what can be withdrawn at 55 above BRS/FRS. Cash top ups can be withdrawn but not OA to SA transfers?

You can use CPFIS approved investments to grow OA.

SRS contributions can reduce tax.

Cash top-ups to SA are reserved for transfer to RA at 55. Once FRS is met in RA, excess in SA/OA can be withdrawn but the withdrawal order is always SA followed by OA. With property pledge, you can withdraw BRS from RA.

 

[karakorum1999]

You can use CPFIS approved investments to grow OA.

SRS contributions can reduce tax.

Cash top-ups to SA are reserved for transfer to RA at 55. Once FRS is met in RA, excess in SA/OA can be withdrawn but the withdrawal order is always SA followed by OA. With property pledge, you can withdraw BRS from RA.

From what I know, those who wish to use property pledge at age 55 (or later) to withdraw as much as possible of your CPF monies, do take note if you have been topping up your SA under RSTU scheme (whether cash or from your OA). The top-up amounts plus accrued interest will have to stay in your RA account, on top of the BRS. Hence you will only “get back” your top-ups from CPF Life payouts.

On the other hand, if you fully intend to retain FRS in your RA account, then this does not matter as there is no “obligation” to retain beyond FRS.

 

[Nofear40]

From what I know, those who wish to use property pledge at age 55 (or later) to withdraw as much as possible of your CPF monies, do take note if you have been topping up your SA under RSTU scheme (whether cash or from your OA). The top-up amounts plus accrued interest will have to stay in your RA account, on top of the BRS. Hence you will only “get back” your top-ups from CPF Life payouts.

On the other hand, if you fully intend to retain FRS in your RA account, then this does not matter as there is no “obligation” to retain beyond FRS.

Can I transfer OA to SA after FRS is met?

 

[highsulphur]

Can I transfer OA to SA after FRS is met?

no you can't

 

[Nofear40]

no you can't

Thanks

 

[Sambuca78]

Definitely $1,800.
My MA has been maxed for several years, and I can see how it works from my accounts.
SA mandatory contributions from employment always accrue to SA, even if SA>FRS and even after age 55.

Thanks for confirming.

 

[highsulphur]

Definitely $1,800.
My MA has been maxed for several years, and I can see how it works from my accounts.
SA mandatory contributions from employment always accrue to SA, even if SA>FRS and even after age 55.

pls don't mislead people. After max FRS in SA, the max total credit into CPF remains at 2200. Just that MA portion will flow to OA

 

[reddevil0728]

It's possible to have more than one employer. Each has a separate CPF Annual Limit.

VC balance will be based on which limit?

 

[reddevil0728]

pls don't mislead people. After max FRS in SA, the max total credit into CPF remains at 2200. Just that MA portion will flow to OA

thought poster asking about OA and not CPF?

Yes, from employment. This is why I am confused...

Right now, contributions are as such : OA ($1260) : SA ($420) : MA ($540)

So after top up SA to 186k, the mthly contribution to OA will be $2220 (1260+420+540) OR $1800 (1260+540)?

Thanks!

 

[highsulphur]

thought poster asking about OA and not CPF?

why did he break the 2220 into 3 parts and 1800 into 2 parts?

 

[reddevil0728]

why did he break the 2220 into 3 parts and 1800 into 2 parts?

poster is asking if it is either

scenario 1:

OA amount goes into OA
SA amount goes into OA
MA amount goes into OA

or scenario 2

OA amount goes into OA
MA amount goes into OA

no?

 

[compro_1975]

I can vouch for that. There were a few years in the past when I did part time work (with blessing from my main employer) with a separate entity, and I was pleasantly surprised to see how the CPF contributions for 2nd employer work separately and independently from the 1st.

pls explain more can? tks

 

[reddevil0728]

pls explain more can? tks

basically you got 2x annual cpf limit?

 

[twosix]

 

[BBCWatcher]

Can I transfer OA to SA after FRS is met?

However, you can transfer your OA dollars to a qualified family member’s SA or RA in that event. The recipient (under age 55) must have room below the Full Retirement Sum, or (age 55+) Enhanced Retirement Sum.

VC balance will be based on which limit?

When you have more than one employer each one has a separate CPF Annual Limit for compulsory contributions. I have no idea what the applicable limit is for Voluntary Contributions in that event. At the very least it seems like you wouldn’t have any VC room if you’re hitting the CPF Annual Limit with at least one employer, but that’s a good question for the CPF Board.

 

[Nofear40]

However, you can transfer your OA dollars to a qualified family member’s SA or RA in that event. The recipient (under age 55) must have room below the Full Retirement Sum, or (age 55+) Enhanced Retirement Sum.

Thanks

 

[Nofear40]

Too many people have been shielding? Looks like government will be closing this gap soon? Paying too much interest

 

[karakorum1999]

pls explain more can? tks

It means that for those years, my annual total mandatory CPF contributions from employment exceeded $37,740.

Main employer (employer 1) already provided me the maximum mandatory contributions of $37,740. This can be achieved by a monthly pay of $6,000 (or more) and a variable payment (usu. bonus, including AWS) of $30,000.

Suppose my employer 2 gives me monthly pay of $2,000, and no bonus. Then every month, I will get mandatory CPF contributions of $740 (37% of $2,000) for a total annual contribution of $8,880.

So my total mandatory CPF contributions for that year is $37,740 + $8,880 (=$46,620).

From another angle, normally if you have only 1 employer, your mandatory CPF contributions for a particular month arising from Ordinary Wages would be at most $2,220 (capped at $6,000x 0.37) even if your monthly pay far exceeds $6,000. However, in my case, the contributions from Ordinary Wages for each month was $2,960 ($2,220 from employer 1 & $740 from employer 2).

Hope this is sufficient to illustrate how it had worked for me.

I suppose this probably means that with 2 employers, the annual CPF limit of $37,740 becomes doubled, and the same rule applies for 3 or more employers, but I would not be able to vouch for those from my personal experience.

 

[BBCWatcher]

That article you posted, Nofear40, doesn't make a lot of sense to me. $2,190 of additional interest isn't anything to scoff at. And it's not ridiculous to assume zero withdrawals from CPF for quite some time. This maneuver (shielding) is performed at age 55. Work even another 5 years before withdrawing (i.e. retire at age 60) and that's over $11,000 of additional interest. (The interest compounds annually on the $2,190.) And that's assuming you start drawing down CPF from age 60, not other assets first.

Moreover, that's not the end of it. Shielding also lets you shift more OA dollars into RA, up to the Enhanced Retirement Sum. That's a very good deal, too.

AND the Full Retirement Sum and Enhanced Retirement Sum are increasing every year, and faster than inflation. Today's $2,190 is based on today's shielding amounts. This number is increasing faster than inflation, right along with the FRS/ERS. Next year it'll be bigger in real terms, so the real value of shielding is increasing.

AND the article talks about fees. There are no fees with SA shielding, not when you do it in any sensible way (use a zero fee platform). The author might be confusing SA shielding with the CPF Investment Scheme (OA). The only costs are the one or at most two months loss of CPF interest on the shielded amount and the slight risk of a small capital loss while the funds are inside the low volatility unit trust. (Although there's also a possibility of minor capital appreciation.)