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Elijah Lee
20 Nov 2019
Senior Financial Services Manager at Phillip Securities (Jurong East)
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Hariz Arthur Maloy
20 Nov 2019
Independent Financial Advisor at Promiseland Independent
When RA is created at age 55, it will take money from SA first to try and fulfill FRS. If insufficient, it will then take money from OA.
Example. Age 55 in 2019.
OA 100K SA 100K. When RA is created it will take 100k from SA, and then 76k from OA.
Leaving 24k OA 0 SA 176k RA.
24k in OA is fully liquid and anymore money entering OA and SA is also fully liquid.
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Hi Han,
The priority is SA first. Let's assume you have plenty in SA but little in OA due to your house payments. Funds will be transferred to RA until you hit $176K, or OA and SA balance combined only has $5K left (you will always be allowed to with $5K at 55). Any balance in SA and OA will then be free to be withdrawn.
If SA has insufficient funds, but OA has plenty, then your OA monies will be transferred once SA has been depleted. Again, until either you reach $176K, or OA balance is $5K.
I'd talk about the shielding trick, but it's only really workable if you have a sizeable balance in both accounts.