As a fresh grad, does topping up the savings allocated to CPF OA for risk free returns make sense if I intend to buy a resale flat with my SO within the next 3 years?

Thinking about putting the current savings allocated for future housing into CPF, since it pays more than the bank interest rate and is risk free, plus saving a small amount on income tax.

Just wondering if there are any major problems/opportunities that I might have missed out.

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Oliver Siah

02 Aug 2021

Co-Founder at Fraxtor

Its better to have some free cash on hand for renovations and buying furnitures.

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Elijah Lee

31 Jul 2021

Senior Financial Services Manager at Phillip Securities (Jurong East)

Hi Jiachao,

(I presume you are working at a regular job I.e. you are not self employed)

You can't top up CPF OA directly, only via 3-account Voluntary contributions, and even so, some monies will end up in MA and SA.

You don't get income tax relief on 3 account contributions either. Only contributions to MA or to SA (via RSTU) will confer tax reliefs.

So topping up your OA might not be a good move in view of your requirements.

Also, do keep some cash on the side. Buying a resale flat comes with various types of costs, some of which cannot be paid by CPF OA monies.

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Ryan

31 Jul 2021

Yes. Because you cannot only top up your OA. Volunteer top up only can be done for SA, MA or all 3 a...

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