(Official) Child Development Account

[chopra]

For ocbc, first $36k 2%. 0.05% thereafter.

For UOB, first $20k 1.7%. 2% thereafter!

Anyone know if we are allowed to jump ship?

Can couple this with ocbc bonus+. Park in all mths except mar jun sep dec

Sent from ew line is so sloooow using GAGT

 

[Keverus]

i think to jump ship, you need to close the account, re-apply for the form from MCYS, then go the other bank and open the acocunt.

 

[Perisher]

So one must have way more than 20k to enjoy the 2% vs OCBC's 2% for the first 36k.
If it's a 12 year investment, would it not be better to put the excess $$ not matched by gov in a bond+etf mix?

Btw, can wait for the others...
http://www.channelnewsasia.com/news/business/posb-to-launch-baby-bonus/1969704.html
Dunno if they have better offers.

 

[chuanz]

Can couple this with ocbc bonus+. Park in all mths except mar jun sep dec

Sent from ew line is so sloooow using GAGT

Doesn't work that way. you can't withdraw cash from CDA.

 

[chopra]

Doesn't work that way. you can't withdraw cash from CDA.

Thanks for informing.

 

[Bedokian]

CDA is like a kid's "CPF", you can only withdraw from it for specific reasons and expenses, usually child care fees.

And once the kid reaches age 12, the money in the CDA will be transferred to PSEA (Post Secondary Education Account), which will be earning at CPF-OA rate of 2.5% currently.

And lastly, when your kid reaches 30 years old, all the amount inside the PSEA will be transferred to his/her own CPF-OA.

Sources - http://www.heybaby.sg/havingchildren/baby_bonus.html

http://www.moe.gov.sg/initiatives/post-secondary-education-account/about-the-psea/

My tip for handling the CDA and the cash payout - do not use the cash payout to do the "matching" in the CDA. Since they allowed a timeframe of 12 years to do the matching, one could slowly top up $500 - $1,500 per year, depending on the birth order of the kid.

 

[Flex11]

CDA is like a kid's "CPF", you can only withdraw from it for specific reasons and expenses, usually child care fees.

And once the kid reaches age 12, the money in the CDA will be transferred to PSEA (Post Secondary Education Account), which will be earning at CPF-OA rate of 2.5% currently.

And lastly, when your kid reaches 30 years old, all the amount inside the PSEA will be transferred to his/her own CPF-OA.

Sources - http://www.heybaby.sg/havingchildren/baby_bonus.html

http://www.moe.gov.sg/initiatives/post-secondary-education-account/about-the-psea/

My tip for handling the CDA and the cash payout - do not use the cash payout to do the "matching" in the CDA. Since they allowed a timeframe of 12 years to do the matching, one could slowly top up $500 - $1,500 per year, depending on the birth order of the kid.

I have thought of that as well but i end up topping up the 6k within a few months after my baby was born.

This is to prevent any possible hassle and confusion. If I decide to top up few years later, I would probably have forgotten how much I already put in.

Since CDA account cannot be withdrawn like normal account, I would only want to top up the maximum amount entitled to the 1-for-1.

 

[Yo2020]

I have thought of that as well but i end up topping up the 6k within a few months after my baby was born.

This is to prevent any possible hassle and confusion. If I decide to top up few years later, I would probably have forgotten how much I already put in.

Since CDA account cannot be withdrawn like normal account, I would only want to top up the maximum amount entitled to the 1-for-1.

yes n start earning interest (as high as 2%) early.

 

[Bedokian]

I have thought of that as well but i end up topping up the 6k within a few months after my baby was born.

This is to prevent any possible hassle and confusion. If I decide to top up few years later, I would probably have forgotten how much I already put in.

Since CDA account cannot be withdrawn like normal account, I would only want to top up the maximum amount entitled to the 1-for-1.

Good point. Same as you, I used fresh funds to top it up to the maximum matching amount within the first year of my kid's age. The slow and steady method which I had mentioned is good for those who have cash flow problems and the main gist is not to use the bonus amount to do the matching.

 

[anfielder]

I have thought of that as well but i end up topping up the 6k within a few months after my baby was born.

This is to prevent any possible hassle and confusion. If I decide to top up few years later, I would probably have forgotten how much I already put in.

Since CDA account cannot be withdrawn like normal account, I would only want to top up the maximum amount entitled to the 1-for-1.

Same here, I put in the max $6k once the account was set up. Can use the money for infant/child care, and in fact at the rate it's going it'll be used up in about 2 years.

 

[flikmy]

i think to jump ship, you need to close the account, re-apply for the form from MCYS, then go the other bank and open the acocunt.

I think the Baby Bonus website is about to announce a process for switching accounts from one bank to another.

On POSB's website, POSB CDA it shows a link for switching which currently only refers to the baby bonus website.

 

[flikmy]

Looks like it's possible to do on the babybonus site now.

From the FAQs:

How can I change my CDA bank?
CDA trustees can log in with their SingPass to submit a request for change of CDA bank, using "Change of CDA Bank" service. Funds will be transferred from the old CDA to the new CDA within 3 weeks.

 

[Panerex]

For ocbc, first $36k 2%. 0.05% thereafter.

For UOB, first $20k 1.7%. 2% thereafter!

Anyone know if we are allowed to jump ship?

Can couple this with ocbc bonus+. Park in all mths except mar jun sep dec

Sent from ew line is so sloooow using GAGT

Is the ocbc 2% valid for a promo period only, or is it a perm feature?

Apply to CDA extra account ?

 

[OCBC Bank]

Is the ocbc 2% valid for a promo period only, or is it a perm feature?

Apply to CDA extra account ?

Hi Panerex,

With effect from 13th July 2015, these are the interest rates for both the CDA and CDA Extra account.

Account balance: S$0 – S36, 000
Interest rate: 2.0% p.a.

Account balance: S$36,001 and above
Interest rate: 0.05% p.a.

^Dione

 

[coey]

Ts, how come you never include posb bank ?
Can include the respective bank cda link as well ?

 

[Panerex]

Hi Panerex,

With effect from 13th July 2015, these are the interest rates for both the CDA and CDA Extra account.

Account balance: S$0 – S36, 000
Interest rate: 2.0% p.a.

Account balance: S$36,001 and above
Interest rate: 0.05% p.a.

^Dione

Great

Thanks Dione

 

[buffertank]

Can check this site to see the up to date CDA interest rate offering by the 3 banks.
http://littlesparkletots.com/financial-planning/cda-account-which-bank-offers-better-interest-rate-return-part-2/

 

[Spirax]

• OCBC: 1.2% p.a. on the first S$10,000 and 2.4% p.a. for amounts above S$10,000.
  
  
• UOB: 1.00% p.a. on the first S$25,000, 2.00% p.a. on the next S$25,000, and 0.05% p.a. on amounts above S$50,000.
  
  
• POSB: Up to 2% p.a. interest on balances up to S$50,000.