facebookIs it recommended to top up my child's CDA account even after I have utilised the dollar-for-dollar matching benefits? - Seedly

Bin Rui

21 Aug 2020

Saving Hacks

Is it recommended to top up my child's CDA account even after I have utilised the dollar-for-dollar matching benefits?

I mean is it wise to top up so I can make use of the 2% interest rate? Other than this, I can't think of any other benefits.

Discussion (1)

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Duane Cheng

21 Aug 2020

Financial Consultant at Prudential Assurance Company Singapore

Hi Bin Rui,

For starters, you should max out the government matching dollar yearly. Unless you have excess cash lying around, it would be better to put the excess top ups towards your own use. (e.g. CPF-SA, CPF-MA) You will also qualify for tax relief if you do so!

Eventually over the span of 10 years 30k would have been deposited inside, which will grow in interest yearly in the CDA. Following which, the interest rate will be 2.5% in the PSEA. At no time can you withdraw from your CDA or PSEA account, so if you are looking to grow your own funds you will need to leverage elsewhere!

Hope i was able to answer your queries!

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