facebookIsn't CPF contributions a fixed amount? How would I control the amount I want in the account by 65 years old? - Seedly
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11 Jun 2020

Isn't CPF contributions a fixed amount? How would I control the amount I want in the account by 65 years old?

Through a pay raise? Take on more jobs at once? CPF contributions not really in my control right?


    Discussion (2)

    What are your thoughts?

    The CPF contributions are based off your salary and is mandatory by law. The maximum amount you can contribute through mandatory and voluntary contributions is $37,740 .

    For employees below 55 years old, it is 37% (20% employee, 17% employer) of your ordinary wage(OW) up to $6000. If you have commissions or bonuses, it is considered under additional wage(AW) and is also 37%.

    If you want to increase your CPF contributions and CPF balance,
    1. Get a pay raise to minimum $6000/month basic salary.
    2. Get as much as annual bonus as you can.
    3. Do voluntary top ups to your CPF up to the Annual Limit (there are some tax benefits depending on what you top up to; do factor your employer contributions for the Annual Limit)
    4. Invest your CPF OA above $20,000.

    Steps 1-4 are in your control.





      There are a few ways but generally
      1) through working (as opposed to not working)

      2) trying not to use cpf to pay for your house - I think generally most Singaporeans do use it to pay for house and so they are cash rich but cpf poor

      3) doing cpf top ups

      4) irreversible transfer oa to sa

      5) making good investments with OA

      When we say plan the amount in the account by 65, generally it would involve all five parts, but the easiest way in my opinion is just plan for certain targets and gradually take steps to save towards that. Reaching a specific goal is not the hardest part... Most often it's that people don't set goals, and don't take the steps to reach the goal. Think smaller milestones, more steps... You will get there eventually.

      Eg I am probably close to FRS, and my original goal was to make sure I get there end of this year, but with the current crisis, I am a bit cash strapped. I might end up doing less top up, and make up for it with the OA to SA transfer.




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