cpf Special account shielding

[maple96]

You really are quite rude.

Please take another look at what I wrote. Hint: The Special Account shield is in place, still raised. The SA balance is zero when the RA is created. The immediate withdrawal would come only from OA, and the "all three" redeposit would, in some portion, go into SA. See it now? Good.

Stupid hack! Because u dun understand the CPF rules for withdrawals! U are recommending to make people "lose money"! Use the example I gave in my prior post to calculate to show us the prove!

 

[a4973]

You really are quite rude.

Please take another look at what I wrote. Hint: The Special Account shield is in place, still raised. The SA balance is zero when the RA is created. The immediate withdrawal would come only from OA, and the "all three" redeposit would, in some portion, go into SA. See it now? Good.

say it works & i withdraw $XXX from OA & VC same $XXX to all 3 accounts, the allocation would be based on the [Above 55 to 60] tier right? bcoz at that time i would have passed 55th birthday for the RA to be created?

 

[Tiger9119]

say it works & i withdraw $XXX from OA & VC same $XXX to all 3 accounts, the allocation would be based on the [Above 55 to 60] tier right? bcoz at that time i would have passed 55th birthday for the RA to be created?

If I m not wrong, there is a limit ($37740) that you can VC into the 3 accounts and only a small portion(about 13%) go into SA, if you are above 55.

 

[a4973]

If I m not wrong, there is a limit ($37740) that you can VC into the 3 accounts and only a small portion(about 13%) go into SA, if you are above 55.

based on this its only 3.5% for above 55 to 60 tier https://www.cpf.gov.sg/Employers/EmployerGuides/employer-guides/paying-cpf-contributions/cpf-contribution-and-allocation-rates

 

[Tiger9119]

based on this its only 3.5% for above 55 to 60 tier https://www.cpf.gov.sg/Employers/EmployerGuides/employer-guides/paying-cpf-contributions/cpf-contribution-and-allocation-rates

3.5% is for 60-65yrs.

Based on my own VC, only 11.852% of the VC amount go into SA.

 

[maple96]

You really are quite rude.

Please take another look at what I wrote. Hint: The Special Account shield is in place, still raised. The SA balance is zero when the RA is created. The immediate withdrawal would come only from OA, and the "all three" redeposit would, in some portion, go into SA. See it now? Good.

Example:

If u have 200k in SA and MA at BHS when u hit 55 in Sept 2019 (eg), and u blindly attempt the suggested “hack”, without checking your “math-odology” or fail your maths, u will “lose money”!

I have already given u opportunity to make amends, u just refuse to think!

"math-odology" = check your maths and methodology refers to withdrawal rules.

BBW recommends u withdraw $17,740, then use this amount to VC into OA/SA/MA. Using my example, because your MA is max, the VC will then go into OA (taking the MA portion) & SA only.

The following will be the allocation for the $17,740 if u use the CPF calculator:

OA = 8188.79
SA = 2387.80
MA = 7163.41

MA will be transferred to OA, so total OA credited = 8188.79+7163.41 =15,352.20

When u apply to withdraw $17740, this is how CPF will calculate the withdrawal (for purpose of discussion we simplify all calculations/formula and assumptions of no movement in account):

1. SA balance at beginning of year 200k. Interest at 4% up to mth prior to withdrawal = 200k*4%/12*8 =5333.33

2. OA (we assume u have 200k at start of year) = 200k*2.5%/12*8 = 3333.33

3. Because u have zero balance in SA at time of withdrawal, the difference will be taken from OA = 3333.33+9073.33 = 12406.67

So what happens in the end?

U withdrawn 5333.33 from SA and only put back 2387.80! U are losing opportunity to earn 4% interest on a higher amt going forward!

Not stupid to hack?

 

[starry9t]

I think BBCW mentioned “immediately redeposit" the $17740 withdrawed, so the loss in interest would be for 1 month at most? Your calculation is showing that the loss of interest would be 8 months ($5333.33), would u explain a bit more why there would be 8 months interest loss if someone withdraws $17740 in Sept and redeposit it back in the same month?

Example:

When u apply to withdraw $17740, this is how CPF will calculate the withdrawal (for purpose of discussion we simplify all calculations/formula and assumptions of no movement in account):

1. SA balance at beginning of year 200k. Interest at 4% up to mth prior to withdrawal = 200k*4%/12*8 =5333.33


U withdrawn 5333.33 from SA and only put back 2387.80! U are losing opportunity to earn 4% interest going forward!

Not stupid to hack?

 

[madtari]

Because... the CPF rules of withdrawal states that money will be deducted in the following sequence:
1) Interest earned under SA in that year till point of withdrawal
2) Interest earned under OA in that year till point of withdrawal
3) Balance in SA
4) Balance in OA

Therefore even if SA shield is up (according to maple's assumption that shield is up only in Sept), money will still be taken from SA under cat 1 above.

I think BBCW mentioned “immediately redeposit" the $17740 withdrawed, so the loss in interest would be for 1 month at most? Your calculation is showing that the loss of interest would be 8 months ($5333.33), would u explain a bit more why there would be 8 months interest loss if someone withdraws $17740 in Sept and redeposit it back in the same month?

 

[starry9t]

Wow, never knew about this. The cpf rules are really extremely complicated!

Because... the CPF rules of withdrawal states that money will be deducted in the following sequence:
1) Interest earned under SA in that year till point of withdrawal
2) Interest earned under OA in that year till point of withdrawal
3) Balance in SA
4) Balance in OA

Therefore even if SA shield is up (according to maple's assumption that shield is up only in Sept), money will still be taken from SA under cat 1 above.

 

[BBCWatcher]

OK, so what happens if you turn 55 in January? Remember, you’re raising a SA shield in January, so there’s no SA interest that particular calendar year. (January is sacrificed already for the shielding.)

This can be done, it just depends on the circumstances. This is some advanced CPF hackery.

 

[lifeafter41]

Example:

If u have 200k in SA and MA at BHS when u hit 55 in Sept 2019 (eg), and u blindly attempt the suggested “hack”, without checking your “math-odology” or fail your maths, u will “lose money”!

I have already given u opportunity to make amends, u just refuse to think!

"math-odology" = check your maths and methodology refers to withdrawal rules.

BBW recommends u withdraw $17,740, then use this amount to VC into OA/SA/MA. Using my example, because your MA is max, the VC will then go into OA (taking the MA portion) & SA only.

The following will be the allocation for the $17,740 if u use the CPF calculator:

OA = 8188.79
SA = 2387.80
MA = 7163.41

MA will be transferred to OA, so total OA credited = 8188.79+7163.41 =15,352.20

When u apply to withdraw $17740, this is how CPF will calculate the withdrawal (for purpose of discussion we simplify all calculations/formula and assumptions of no movement in account):

1. SA balance at beginning of year 200k. Interest at 4% up to mth prior to withdrawal = 200k*4%/12*8 =5333.33

2. OA (we assume u have 200k at start of year) = 200k*2.5%/12*8 = 3333.33

3. Because u have zero balance in SA at time of withdrawal, the difference will be taken from OA = 3333.33+9073.33 = 12406.67

So what happens in the end?

U withdrawn 5333.33 from SA and only put back 2387.80! U are losing opportunity to earn 4% interest on a higher amt going forward!

Not stupid to hack?

In this case, the VC really have to be VC, rather then withdrawing from CPF then redeposit.

Cold hard cash, no two ways.......

 

[maple96]

In this case, the VC really have to be VC, rather then withdrawing from CPF then redeposit.

Cold hard cash, no two ways.......

Precisely! Only those with no cash will think of hacking, scarly end up losing

(my example is just a simple example, pls read the full cpf withdrawal rules, make sure u dun fail your maths )

 

[madtari]

Not always true wor... got cash can also keep thinking of maximising returns from cpf, trying to milk the system gao gao. This thread about shield hack is the best example. Lol

Precisely! Only those with no cash will think of hacking, scarly end up losing

(my example is just a simple example, pls read the full cpf withdrawal rules, make sure u dun fail your maths )

 

[maple96]

Not always true wor... got cash can also keep thinking of maximising returns from cpf, trying to milk the system gao gao. This thread about shield hack is the best example. Lol

u seems to like to engage in "chicken and duck debate"?

I am only talking about this particular stupid hack! u dun agree it could cause u to lose money if u fail your maths or dun understand the CPF withdrawal rules?

 

[K|muRa^84]

wont be surprised if gahmen prohibits this hack in the future

 

[maple96]

wont be surprised if gahmen prohibits this hack in the future

u mean the SA shielding hack? Let's all write in to complain, then maybe

 

[madtari]

haha... I think we are really speaking on a different frequency. I totally agree with your below statement

u seems to like to engage in "chicken and duck debate"?

I am only talking about this particular stupid hack! u dun agree it could cause u to lose money if u fail your maths or dun understand the CPF withdrawal rules?

but not the previous one.

Precisely! Only those with no cash will think of hacking, scarly end up losing

(my example is just a simple example, pls read the full cpf withdrawal rules, make sure u dun fail your maths )

Got cash still can be interested in doing hack to milk the system what... that's how the rich becomes richer... everything also try to milk or maximise benefit from. Doesn't mean cash rich you will stop thinking of using life hacks.

 

[maple96]

haha... I think we are really speaking on a different frequency. I totally agree with your below statement



but not the previous one.


Got cash still can be interested in doing hack to milk the system what... that's how the rich becomes richer... everything also try to milk or maximise benefit from. Doesn't mean cash rich you will stop thinking of using life hacks.

confirm u like to engage in "chicken and duck debate"

My whole post is talking about this stupid hack, got cash do VC, dun explore the hack then dun understand CPF withdrawl rules or fail maths and lose money.

thare are so many other better hidden hacks!

 

[madtari]

Don't feel offended, its nothing personal... I love your contributions & sharing actually!

Sharing is loving! Do feel free to educate us more master!

confirm u like to engage in "chicken and duck debate"

My whole post is talking about this stupid hack, got cash do VC, dun explore the hack then dun understand CPF withdrawl rules or fail maths and lose money.

thare are so many other better hidden hacks!

 

[maple96]

"hidden hacks" means u have to wait for someone else willing to "expose"