for dad, i will pledge property, transfer to oa to make up brs, retain sa for withdrawal should emergency arrive.
Do you mean repay OA used for housing? Possible, but an “all three account” Voluntary Contribution could be better. It’ll depend on the father’s MA balance, really, and how much he wants to add to his MA. (The MA residual goes to his nominee, presumably the mother, and that’s not a bad thing at all. MA also earns 4% interest.) And bear in mind there could be $600 in matching funds available but only if he still hasn’t reached the BRS next year (2021). That’s not necessarily a reason for inaction (since CPF interest could be more important), but $600 in free money is a consideration.
if dad needs more payout, then withdraw from sa as and when needed.
I think serious consideration ought to be given to at least one of these parents joining CPF LIFE, probably the mother first and assuming her RA is boosted (which should be the priority since she doesn’t appear to be even close to maximizing bonus interest). The point of CPF LIFE is to avoid outliving one’s savings either through exhaustion or mismanagement. That longevity protection has value.
We don’t have complete information here, such as cash and MediSave balances. However, let’s suppose for sake of argument this couple is sitting on $750,000 stewing in bank fixed deposits and savings accounts. (Maybe they sold a private property and didn’t use much or any OA to pay for it.) Almost certainly then they should be injecting significant amounts of cash into CPF, starting with the mother’s Retirement Account. All we know to this point is that they have at least decent cash reserves.
I should also point out that the children can qualify for tax relief. Let’s suppose there are two children, both in the 7% income tax bracket. Each of them could deposit $7,000 into their mother’s Retirement Account, then next year they’ll get $490 back from IRAS in the form of reduced income tax. They could even make those top ups then ask their parents to hand them $6,520 each and still come out $10 ahead. (Well, OK, the tax savings comes later, and there is a little interest that could be earned on $7,000 in the meantime, but $10 seems fair compensation.) Obviously other arrangements are possible, but I’m simply pointing out that tax relief is likely available, so why not collect it? That doesn’t mean stopping at $7,000 or $14,000 of top ups.
