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CPF

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Loans

CPF

Payments

EK
Eileen Khoo
Level 3. Wonderkid
Updated 15h ago
Https://www.dbs.com.sg/personal/calculators/homeloans-calculators-repayment-schedule.page The above is an example of a loan repayment calculator obtained online via the dbs website. With the variables 1) loan amount 2) tenure 3) interest rate (hdb 2.6%) One can use this to calculate the monthly instalment figure; and generate a monthly repayment schedule. Using the Original figures, original full loan amount and full term will generate a repayment schedule that should give you your current situation. (This whole paragraph is a bit side tracked; Notice that the schedule uses a monthly reducing balance interest estimate; as in It uses the Opening monthly outstanding balance X interest rate (2.6%/12; interest rate chargeable per month) Then it adds this interests to the opening outstanding and minuses off whatever payment that one makes for the month (lump sum or partial principal or monthly instalment etc) to arrive at the closing outstanding balance. This closing outstanding balance then acts as the new opening outstanding and goes through the same process until the loan is settled. I will come to this “monthly reducing balance” later.) #I believe you also know that the are TWO ways in which one can reprice the current outstanding; which are 1) shortening the tenure (you are asking this) ; this means maintaining the same monthly instalment amount and paying in shorter time 2) reducing the monthly instalment amount. (Maintaining the tenure and reducing the amount paid monthly) There are a few ways to find out how many years will be shortened, one simply takes a look at the original repayment schedule (from the website for example), to see which part of the schedule one is currently at; by matching the “current outstanding of the actual loan to the current outstanding in the schedule” This means, find out 1) current outstanding amount with hdb 2) look into the repayment schedule to see where the outstanding amount is. This would be somewhere into the 10th year to follow that you have paid up 10 years. Find out which particular month (or between two months) the outstanding balance matches. Mark this spot-let’s just say “A”. Then take this current outstanding loan and minus the amount of lump sum you are looking to pay off to get a new lower current outstanding balance. Let’s just say this is “B” Now look for where “B” is in the repayment schedule. The period between A and B is the period you have managed to cut off the repayment schedule (in months) and the balance of tenure is the period from B to the end of the tenure ( ) That’s about it. There are other ways to calculate, using excel etc. Some prefer to go by looking at the “principal” column; one can see how much principal is being used to knock off the outstanding balance each month. I.e. Outstanding $100,000 Monthly installment $1779.15 Interest paid $216.67 “Principal paid $1562.48” If one pays$1779.15 and knocks off $1562.48 in principal from the outstanding, in this example, one knocks off one month period ( ) Just add up the principals monthly to reach the amount of lump sum you are looking to pay off and match that with the number of months shortened. If for example one intends to pay off $50,000; From the matching current outstanding, just take the $50,000 and minus the next month’s principal paid back amount and the next’s and the next’s and next’s until the $50,000 finishes. Etc. On actually “how much lump sum to pay”, the minimum allowed is SGD5000 and from then onwards increases in multiples off $1000. So, do add the sums to match the interests saved or the periods you want to save to get an idea. Hope this helps. P/s not involving the questions posed; I) Are you opting to keep sgd20k in the CPF OA due to the extra 1% given (totalling 3.5% or “an extra 0.6% over the loan”)? I am assuming this. The other option could to transfer the funds to the Special Account to attract the 4%. Point- CPF could be better if this is available. II) On the monthly reducing balance mentioned; the effective rate would be lesser than 2.6% a year and the difference increases more if the outstanding reduces more (more principal is being paid). Take the total interests to be paid for the year and divide it by the outstanding balance at the beginning of the year to get the effective rate. Point- Chances are that these last 5 years could get much lower effective rates (and therefore cost less than the 3.5% to be gained from the first $20k in the CPF OA or the 4% if the same is transferred into the Special Account). III) the term is shorter towards the end of the loan, so the lump sum paid (say $50k) will have a “shorter” tenure to be effective. So the Lump sum used would only be used for saving interest for term of the tenure (5 years max) n none thereafter. Left in CPF this same sums would generate 2.5%?3.5%? 4%? Etc. compounded yearly, until taken out (with many scenarios allowing for this to be more than 5 years) Point- Leaving it in CPF May be an option to consider. Comparison is made on interest rate and tenure and not on other factors like availability of funds etc. What these means is that there could be very little to be saved if this is done after 2/3s of the loan being paid as both the effective rates and tenure have reduced. I could be wrong but do consider looking at the numbers. These are the main reasons why there are people using Other People’s Money (loans, credit card etc) to pay off home during the first 30%-60% of the home loan. And stretch the home loan once the effective rates are Low- aka to prolong settling the loan after clearing 70% of principal outstanding for example. The money used to settle the loan could be used to generate a better rate of income than the actual savings from settling the loan. (Stress issues aside) Cheers.

CPF

CPF SA

Kenneth Quek
Kenneth Quek
Level 5. Genius
Answered 23h ago
You already have a 20k investment portfolio. Are you confident of getting 4% pa? If you are, why would you want to top-up your CPF? If you're confident in your discipline and investing, CPF should not be necessary. If you're not, CPF is a very safe way to get to a safe retirement income in the future. The only reason (I can think of) to top-up early, is if you want a huge SA in the future. Since you can only top-up to FRS and let it grow from interest and salary contributions from then onward, then it makes sense to try to hit SA ASAP, so that more of the interest and contributions will go beyond FRS.

Resale HDB

CPF

Payments

Property

You will receive your payment in cash if you have paid for it in cash. That's under the understanding that you have never paid for your HDB with CPF OA and you have never paid for your HDB bank loan with CPF OA. Doesn't matter how the buyer fund his purchase of the resale flat.

CPF

Insurance

Investments

Retirement

Any lifetime income annuity policy would suffice. I could show you a few if you'd like from multiple insurers. I have the calculations and projections made for different age groups. Only issue is that CPF is known to change the black and white from time to time, so this rule may not be in effect when you're 55, so that's the issue.

MoneyOwl

Investments

CPF

Kenneth Quek
Kenneth Quek
Level 5. Genius
Updated 2d ago
Endowus only provides DFA and PIMCO for cash and SRS. For CPFIS, they offer other products, not DFA. This is probably a regulatory issue, so until they clear DFA with CPF, I think it is unlikely that MoneyOwl would be able to offer DFA for CPFIS as well. As for withholding tax, I recall that both have worked with DFA to structure the funds to be Ireland domiciled, so withholding tax should not be an issue.

Stocks Discussion

Savings

SG Budget Babe

MileLion

Investments

Insurance

Property

Career

CPF

Bjorn Ng
Bjorn Ng
Top Contributor

Top Contributor (Dec)

Level 9. God of Wisdom
Answered 4d ago
Me!! Super excited! I have a friend who went last year, he signed up again this year!

CPF

Family

Hi Jared, The CPF savings will be distributed by the Public Trustee’s Office (PTO) to the legally entitled beneficiaries according to existing intestacy or Muslim inheritance laws. A fee is charged for the distribution of unnominated CPF savings. Do note that CPF savings cannot be distributed via a will as they do not form part of the estate. The 9 rules are as follows: https://sso.agc.gov.sg/Act/ISA1967 Please ensure a nomination is made if this is of concern for you (or whoever you are asking for). It only takes a few moments to do so.

Investments

CPF SA

CPF

You cannot rebalance it, so it's really annoying. Purely from a portfolio rebalancing angle it has to be taken aside. But we should take it as part of portfolio, else we may have too many bond like holdings. I am holding 65-35 including cpf SA and MA, with whatever I can invest in OA invested.

CPF

Investments

CPF IS

UOB

FSM INVEST EXPO 2020

Hi anon, You'll need to have a Gold Savings Account with UOB to get started. My understanding is that you can buy both normal gold bullion, or coins, or just a gold cert. More information here: https://www.uob.com.sg/personal/invest/goldsilver/overview.page Also, use the stocks and gold limit calculator to have an idea of how much you can invest in gold: https://www.cpf.gov.sg/eSvc/Web/Schemes/StockAndGoldLimits/StockAndGoldLimitsLanding To buy a gold ETF, this is different from gold buillion/coin/cert, as an ETF is traded on the exchange. Hence you will need a brokerage account to do so. Right now, only SPDR gold shares is allowed. More information here: https://www.cpf.gov.sg/Assets/members/Documents/LISTOFGOLDEXCHANGETRADEDFUNDSINCLUDEDUNDERCPFIS.pdf

CPF

Hi Musang, 1. Daughter can contribute $7K via RSTU to father's RA per year for tax relief as long as the RA is not at that year's prevailing FRS 2. For son in law, conditions s ame as the daughter 3. If any contributions are made to the father's OA/SA/MA, that will be via normal voluntary contributions which will be split across 3 accounts. Subject to the annual limit of $37740. The monies will then be divided between the 3 accounts accordingly. So some money will flow to MA and it can't be withdrawn. However if that's ok, then understand that once the MA is full (i.e. @ BHS of $60K), future top ups to OA/SA/MA will just flow to OA/SA instead, and can be withdrawn any time. So what might be better is to do a one-off CPF MA VC (voluntary contribution) to push the MA to $60K, and then do a 3 account contribution so that everything else goes to OA/SA. Liquidity is not an issue as long as MA is at ceiling. For RA contribution, it can only be done via RSTU, with a ceiling of the year's ERS. Top ups up to the FRS will earn tax relief on the first $7K each year. 4. Since RA has been formed, any amount can be withdrawn from OA and SA. 5. You can, but it doesn't mean you have to. CPF is backed by our AAA rated government. There isn't really any AAA rated bond paying 4% coupons out there. In fact you'd be hard pressed to find 2.5% on a AAA rated bond. Plus, the 'coupons' automatically compound since the interest is credited back to OA/SA respectively. If you need any further clarification, please feel free to reply to this post.
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