Yes I recommend to use more cash to pay for your loan, unless they are generating more than 2.5%. Keep a 3-6 months emergency buffer and you should be fine. Overall, it's all about asset allocation and you want to make sure you are not over allocated or too concentrated on certain asset class.
Typically the asset classes are stocks, bonds, long term bonds, cash, commodities, home equity. Just make sure that by partial repayment you are not overly allocating your capital on home equity.
Eric Chia, Senior Financial Consultant at Prudential
Answered on 02 Jul 2019
Just giving a brief answer here. Your interest rate does not change, though the accrued interest on your cpf will reduce.
Good to do partial repayment if your cash or cpf OA investment is giving less than 2.6%p.a. returns.
Assuming you are taking hdb loan @2.6% interest. And you use your OA to pay partly. You will forgo 2...
Read 2 other answers with a Seedly account
You will also enjoy exclusive benefits and get access to members only features.
Sign up or login with an email here