What are some good ways to give allowance to your parents? - Seedly

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Asked by Anonymous

Asked on 26 Sep 2018

What are some good ways to give allowance to your parents?

Some people mentioned we could top up their CPF to get more tax rebate. Is it a good way to give our parents the allowance? Also would be good to hear more hacks to this

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Gabriel Tham
Gabriel Tham, Tag Team Member at Kenichi Tag Team
Level 8. Wizard
Updated on 07 Jun 2019

Top up MA is good. Because old people tend to use more medical claim. Plus, CPF MA or SA/RA got higher interest rate.

If your parent not in immediate need of money, CPF top up is good.

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Question Poster

27 Sep 2018

Thanks for your input! What if my parents are already more than 65? Does this still work?
Serene Toh
Serene Toh
Level 5. Genius
Answered on 14 Nov 2018

Asked my parents if they want me to gave cash or top up CPF. They say cash. The cash helps them deal with their daily expense. CPF too complicated for the elderly to deal with. (They are way pass retirement already)

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Allowance for Parent and Tax Rebate need not be done together.

Usually allowance are for Parents lifestyle expenses.

You can enjoy tax relief of up to $7,000 per calendar year if you make cash top-ups for your parents, parents-in-law, grandparents if your income tax requires you to do so to pay less tax.

Topping up Retirement Account for Parents if the FRS amount is not met is more for their retirement more then for the present usuage.

And the CPF Life withdrawal starts only at age 65, so whats gonna happen to them before that age without your allowances?

Give your parent allowances as usual and try to grow their retirement income with CPF when you can.

​ Hope my reply helps.

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Thank you.

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Question Poster

27 Sep 2018

Thanks for your input! What if my parents are already more than 65? Does this still work?
Loh Tat Tian
Loh Tat Tian

14 Nov 2018

Of course it does. CPF earns a minimum 4% interest. Take it as your savings inside their RA account (up to $60,000.00) will earn $275 interest a month (since first $60,000 earns 5.5% interest). The only downside is they can’t lump sum take out the money