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Anonymous
Dilemma in whether I should top up my MA via VCMA or my SA via RSTU
Hello have a question. I know several finfluencers including heartland boy advocate for trying to reach BHS first in order to supercharge SA, if not hit FRS yet.
If my mandatory employee and employer contributions via OW and AW would have already hit the CPF annual contribution limit of $37,740
Does it still make to sense for me to VCMA In order to try to hit BHS? (and get some tax relief too)
Or should I just RSTU to my SA and work towards FRS directly? (and get some tax relief too)
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Topping up RSTU or VCMA is usually done with the aim of growing your retirement income (through safer options), which means that Tax saving should be secondary (a plus).
If you haven't reached FRS or BHS:
Topping up VCMA: Useful for you/loved ones' medical purposes/medical insurance.
RSTU to SA: Useful for retirement/investment (If you want tax savings here, you can do the max self top up of 8K).
Other than these options, you can also look into the Matched Retirement Savings Scheme as a better option for retirement planning.
If you have totally no use for the money (as of now) and just want tax savings then perhaps VCMA (more uses) than RSTU.
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If haven't meet BHS shld top up MA due tax relief plus overflow MA contribution from employer monthl...
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If main point is for tax relief , rstu first as it will not overflow. If you vcma first it will overflow to sa which will has lesser quota for your tax relief.