facebookWhich tax bracket do you fall in to make your CPF RSTU worth it? - Seedly

Anonymous

13 Sep 2019

Retirement

Which tax bracket do you fall in to make your CPF RSTU worth it?

Fresh grad @ 25 y/o. With my monthly on 3.5k gross, should I opt for CPF voluntary top up just to save that 7k tax on 3.5% bracket (~$245)?

Discussion (6)

What are your thoughts?

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Loh Tat Tian

13 Sep 2019

Founder at PolicyWoke (We Buy Insurance Policies)

In order for tax bracket to be worth it, you have to be above 11.5%.

MY simple calculation is this. 11.5% Present Value is worth 22% after 18 years. IF you know what I mean.

Fergus Tan

07 Sep 2019

Senior Partner at Vision Advisory Management

As a short answer, no.
The 2 common tax relief product would be SRS and CPF RSTU.
If you are below the 7% bracket, then it makes more sense to keep cash.

If you are above the 7% bracket, then putting to SRS is a good thing to consider.

If you have maxed out your SRS contribution for the year, then you can consider CPF RSTU.

Same as Cedric, Vincent and Elijah.

Thought about this before, and I think even at 7% tax bracket, ...

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