Asked 1w ago
I'm going to top up a lump sum into my son CPF SA and MA account. I heard there is some difference to gain the interest between Dec and next year Jan.
So should I top up in Dec or Jan for lump? Thanks
CPF interest is computed monthly and paid at the end of the calendar year.
Thus, if you want to maximize interest and are okay to part with the funds, topping up in January would maximize your interest earned.
CPF interest is calculated monthly. Hence, topping up as early as possible will help to increase the interest earned.
One thing that I would like to check is, are you topping up into your CPF or your son's CPF? This will make a difference, as topping up into your person CPF will provide you with tax relief, while topping up your son's will not. If you are after the tax relief as well, then I suggest that you take a look to determine which Calendar Year will you require the tax relief more.
Between Dec this year and Jan next year, it's just an extra month's interest but topping up this year will offer some tax relief for this year's taxes.
Between Jan next year and Dec next year, it's an extra 11 months' interest.
CPF interest is computed monthly and paid out at the end of the calendar year. Based on CPF calculation, better to top up in Jan.