CPF shielding

[AMANDALAU1910]

Beware of this person named Allen Goh. He has posted a video on Facebook encouraging those who will be turning 55 soon to transfer their CPF saving from OA to SA to enjoy the higher interest rates.
Don’t be fooled by this person.
The RA was designed because in the past , many had drawn out their CPF savings and didn’t have any any / sufficient money for their retirement.


NB: The transfer of CPF savings from OA to SA is one way traffic not both.

 

[sacredrays]

wrong place to post.

and cpf shielding is about tying up your sa fund into some investment fund prior to 55 so that cpf will have to take more from oa since sa will not have enough to hit min sum.

 

[Intrinion]

Thread moved from hwc to money mind

 

[BBCWatcher]

Beware of this person named Allen Goh. He has posted a video on Facebook encouraging those who will be turning 55 soon to transfer their CPF saving from OA to SA to enjoy the higher interest rates.
Don’t be fooled by this person.
The RA was designed because in the past , many had drawn out their CPF savings and didn’t have any any / sufficient money for their retirement.
NB: The transfer of CPF savings from OA to SA is one way traffic not both.

What are you talking about? I haven’t seen the video, but this advice could be extremely smart!

When you’re age 55+ your Special and Ordinary Account balances (in that withdrawal order) are fully liquid provided your Retirement Account has been funded at least to the Full Retirement Sum (or at least to the Basic Retirement Sum with a property pledge or charge). You cannot transfer OA dollars to your own SA once you reach age 55. That option is gone forever once you celebrate your 55th birthday. Yes, it’s a one way transfer: to higher interest and liquid dollars!

In combination with a technique called “SA shielding” you may be able to transfer OA dollars to SA, shield most of those SA dollars, fund your RA adequately from remaining OA dollars (and/or cash and subsequent compulsory CPF contributions), and end up with big advantages: more money earning the higher SA interest rate, more and more secure retirement income for life, and lots of liquidity at least when your RA gets to the BRS if it doesn’t reach that point at age 55. Without “trapping” so many dollars in OA that are hard to withdraw before you’ve drained your higher interest earning SA first.

If the OA to SA transfer is a good idea for a particular CPF member at age 54.9 could it be an even better idea at age 53? Or 51? Or earlier? Sure! It depends on how much you value OA for what OA can do, pay your mortgage. But if you don’t actually need all your OA dollars to make mortgage payments before age 55 then you’re probably much better off transferring excess OA dollars to SA as soon as you can.

So what are you complaining about?

 

[sglandscape]

What are you talking about? I haven’t seen the video, but this advice could be extremely smart!

When you’re age 55+ your Special and Ordinary Account balances (in that withdrawal order) are fully liquid provided your Retirement Account has been funded at least to the Full Retirement Sum (or at least to the Basic Retirement Sum with a property pledge or charge). You cannot transfer OA dollars to your own SA once you reach age 55. That option is gone forever once you celebrate your 55th birthday. Yes, it’s a one way transfer: to higher interest and liquid dollars!

In combination with a technique called “SA shielding” you may be able to transfer OA dollars to SA, shield most of those SA dollars, fund your RA adequately from remaining OA dollars (and/or cash and subsequent compulsory CPF contributions), and end up with big advantages: more money earning the higher SA interest rate, more and more secure retirement income for life, and lots of liquidity at least when your RA gets to the BRS if it doesn’t reach that point at age 55. Without “trapping” so many dollars in OA that are hard to withdraw before you’ve drained your higher interest earning SA first.

If the OA to SA transfer is a good idea for a particular CPF member at age 54.9 could it be an even better idea at age 53? Or 51? Or earlier? Sure! It depends on how much you value OA for what OA can do, pay your mortgage. But if you don’t actually need all your OA dollars to make mortgage payments before age 55 then you’re probably much better off transferring excess OA dollars to SA as soon as you can.

So what are you complaining about?

This is the best free option for those who know about it and knows how to benefit from it imo. You get higher interest + liquidity unless you don't meet min sum

 

[dork32]

Beware of this person named Allen Goh. He has posted a video on Facebook encouraging those who will be turning 55 soon to transfer their CPF saving from OA to SA to enjoy the higher interest rates.
Don’t be fooled by this person.
The RA was designed because in the past , many had drawn out their CPF savings and didn’t have any any / sufficient money for their retirement.


NB: The transfer of CPF savings from OA to SA is one way traffic not both.

you sounded lost.

if you can transfer oa to sa, it just means that you sa did not reach frs.

lets use a simple example

oa = 200k, sa =100k, frs = 200k, age 54. i will ignore the effects of interest in my example.

case 1 transfer oa 100k to sa at 54.
at 54 oa = 100k, sa = 200k frs = 200l
at 55. oa = 100k, sa = 0 ra = 200k. (100k oa can withdraw

case 2. dont transfer
at 54 oa = 200k, sa = 100k
at 55 oa - 100k, sa = 0, ra = 200k (100k oa can withdraw)

there is no difference in the 2 cases. either way you can draw 100k.

if you put back the interest then case 1 would be better. it is earning a higher interest for that 100k transferred to sa. so you will withdraw more at 55

 

[BBCWatcher]

RA currently earns 4.00%, SA currently earns 4.01% (soon to be slightly higher it looks like), and OA currently earns 2.50%. All these rates assume you've maxed out bonus interest already.

If you transfer OA dollars to SA you pull forward the month when you start earning higher SA interest. If that's 2 whole calendar months of higher interest (for example) that's still "free money." You're still that much richer. If you "shield" SA dollars as you cross your 55th birthday then even better things are often possible.

Anyone want to post a link to this Allen Goh Facebook video?

 

[tangent314]

@AMANDALAU1910
Main thread is here: https://forums.hardwarezone.com.sg/threads/cpf-sa-shielding-hack-fully-explained.6132953