With 130k in My CPF OA, Should I invest 10k of my cpf OA in with Endowus if I am getting a HDB resale in Q3 2021?

I’m turning 32 in 2021, have about 130K in my OA account. I plan to get a resale flat of about 560 to 600k in Q3 2021 and will be getting a hdb loan. Will be financing using my cpf only as my partner does not have cpf.

Is it wise for me to invest about 10k of my cpf OA with Endowus to potentially earn more than 2.5% of the current CPF interest rates?

Any considerations I have to take note of with the upcoming flat purchase?

Thank you very much in advance.

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Elijah Lee

04 Jan 2021

Senior Financial Services Manager at Phillip Securities (Jurong East)

Hi anon,

I would strongly advise against investing your CPF monies.

Due to market volatility, you should aim to have at least a 3 to 5 year horizon when it comes to investing. As your planned flat purchase is in less than a year, you would not have a sufficient time frame to recover should the market crash again.

CPF is risk free and monies needed in the near term should be kept in risk free assets.

Given the 20% downpayment required on the house, that is $120K you will need, and you will still need to factor in other costs such as legal fees, etc, which will also utilize your CPF OA. Furthermore, you need to conserve cash for renovations, and I would highly recommend you strive to retain $20K in CPF OA after all the costs so that you have a buffer for your mortgage in case you lose your job. You will also benefit by earning an extra 1% on that $20K.

In short, don't invest your CPF OA in your particular scenario. It's not worth it.

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