Asked by Ng Kwok Fei

I would like to put 20k into my 23 yr old son CPF. Will I be able to get better returns in other investment over 30 plus years than CPF?

1
0
Share this
Answer this question
Add
Add
Select
Clear
Add
Write your answer

Answers (3)

Sort by:
Most Upvote
  • Most Recent
  • Most Upvote
    • Hariz Arthur Maloy, Independent Financial Advisor at Promiseland Independent

      Top Contributor (Nov)

      229 Answers, 393 Upvotes
      Answered 2w ago

      Definitely. In fact you're locking up that 20k for 32 years and is irreversible.

      A balanced portfolio over 30 years can give you a 5-6% compounded return, a moderately aggressive portfolio can give you 7-8% returns plus gives you full liquidity.

      Comments (0)
      2
      0
      Share this
    • Teo See Hwa, MArketing Associate at Propnex
      39 Answers, 44 Upvotes
      Answered 3d ago

      Nobody know which is better only Time know.

      I put 20% deposit $108,000 in 2006 and 4 years later property appreciate by 1 million.

      If I use your question what will be your answer.

      Comments (0)
      1
      0
      Share this
    Yixiong Chang

    Top Contributor (Nov)

    146 Answers, 186 Upvotes
    06 Dec 2018

    Why don't you topup your own CPF special account instead. Yes, u might not earn the extra 1% but u are able to receive tax relief. Eg, your taxable income is $40k, for every dollar u earn above 40k is taxed at 7%. Therefore, if u topped up $1000 into your special account, u get $1000 tax relief, u saved 7% of $1000 = $70 tax money. Effectively have gotten 7% return on your money. If u are earning more than $80k, u will be in the 11.5% tax bracket.

    Topping up your son's CPF although is able to earn the extra 1%, u will not be able to use the funds for yourself.

    There are definitely plenty of investments that can potentially produce better returns, but it comes with higher risk as well. CPF provides superior risk adjusted return.

    It really depends what purpose u intend your 20k for. You cannot use CPF monies except for its allowed purposes only. Not to mention it is your son's CPF.

    Sign Up or Log In here
    Sign in now to unlock 1 more answer to this question!
    Sign In with Facebook

Manage your money for free today!

Download on the App StoreGet it on Google Play
  • Quick overview
    Quick overview of your bank and card transactions.
  • Secure syncing
    Secure syncing of your bank or credit cards transactions
  • Automatic categorization
    Automatic categorization and analysis for your expenses
Seedly app