How much are you earning per annum?

Originally Posted by Unregistered

What's your combined annual income?

$220k combined.

I was told that I have to return all the CPF money that I withdrew during my repayment of HDB loan to the CPF board. Is it true?

Originally Posted by Unregistered

$220k combined.

I was told that I have to return all the CPF money that I withdrew during my repayment of HDB loan to the CPF board. Is it true?

With your income, I think it is best you take a loan of $500k the most to be safe as interest rates will go up. In this case, you should sell your flat and use the proceeds as downpayment for a condo. Let's say you sell your flat for $500k. You then buy a 3 bedroom $1.3m condo. You need to use the HDB flat sales proceed of $500k plus $300k cash savings and CPF for a $800k downpayment for the $1.3m condo. Loan will be $500k.

If you don't sell your flat, you need to have $800k of cash savings and CPF for the downpayment. How much cash and other assets do you have? What's your total net worth now?

I must say that my wife and I are indeed blessed. Our lives are better many folds compared to 10 years ago. Ten years ago, we lived in a HDB flat but today we are living in a condo. We sold our flat and upgraded to a condo a few years ago. Our condo is our greatest asset, thanks to our strong and robust economy, our condo's value has gone up. This is very positive for us and makes us very happy. We managed to clear our condo mortgage due to our financial discipline and prudence. We are only 47 & 45 years old.

Our incomes have also grown over the past ten years. We also benefitted from investing during the 2008 global financial crisis and now our wealth has gone up because asset prices have recovered.

We feel indeed very lucky to be born here in Singapore. We manage to move up the social ladder from living in a small HDB flat when we were young to becoming successful condo dwellers. In the past I was a kid from a low middle income family, today I am a millionaire. I must thank our wonderful system of governance and meritocracy.

Originally Posted by Unregistered

$220k combined.

I was told that I have to return all the CPF money that I withdrew during my repayment of HDB loan to the CPF board. Is it true?

You can check ://.moneysense.gov.sg/Life-Events/Buying-a-Home.aspx

best option will be to first repay outstanding loan amount for your HDB house and then take loan for condo. Downpayment will be 20%.

Originally Posted by Unregistered

I currently have some loan left to be repaid for my HDB house. I use Cash + CPF for the monthly instalment.

I want to purchase 1 condo but I don't want to sell off my HDB house. How much loan can I take? What is the best option for me?

3 things
a) I presume you know how to avoid the ABSD....
b) Buy quickly because the ABSD will be removed 3-6mths after GE
c) pay up your HDB loan..

How do i know? Coz I have done all of the above and I am taking the keys to my condo unit next week...

[lazyplane]

A few points

a. You can still top up your SA provided you invest your SA despite hitting the cap. The min sum applies to the remaining SA that is not invested.

So just invest your SA and you can top up again.

b. You should be paying down your HDB loan first before seeking to return money to your OA . why leave money in OA when you have HDB loan cost slightly higher ?

c. You can still "top back/pay back" OA to earn 2.6% interest for the HDB loan paid by your CPF OA previously. Conceptually, CPF keeps a record of all OA monies drawn used to pay HDB loan + interest . You should be able to determine that sum by logging in via your singpass and checking your statement.

Few people take option c due to the fact that monies kept in CPF do not have the flexibility like cash. You can earn good interest these days in the market. Eg, with the saving bonds that SG gov is launching, that seems to be a better option that putting your monies in CPF OA as the monies is really "locked up" until retirement or purchase of property/ CPF investment.

Originally Posted by Unregistered

Hi,

I understand the magic of compounding interest from SA and benefit of topping up SA to gain from tax rebate.

I am 43yo, currently OA: $59.6K, SA: $165.8K, MA: $48.5K. I am still using my OA to service my HDB which has balance outstanding of $103.5K.

As I have hit the MS SA limit and would not able to top up further from this year onwards (CPF typically increase MS SA by $6-$7K, my SA and contribution interest would have exceeded the yearly increase), may I ask how do you return the money from property to your OA account?

Did you sell your property and subsequently purchase your property in cash, or downgrade to a smaller property and paid in full?

Should I repay my current outstanding loan of $103.5K by cash instead from deduction from OA?

Thanks for sharing your tips and I am looking forward to CPF money standby for my retirement.

Hi Lazyplane,

Thank you for your comment.

I agreed with your point "b" and "c".

As for point "a", CPF just clarified that it is not possible to top up MS SA if your total SA and amount invested from SA has reached the MS of SA. Also I don't think there is any good and very safe investment instrument that can generate stable 4% (without capital price fluctuation) compared to interest given in SA.

That's why I seeking from the other poster how to achieve $1M CPF and what he did by paying back the loan taken for property from OA.

From my current status (43yo, single contributor for HDB loan repayment (monthly payment at current interest rate $1.1K) my OA: $59K, SA: $165.8K, MA: $48.5K).

When I turn 55, my estimated CPF (12 years later) would probably be OA: $239K, SA: $369.8K, MA: $48.5K (? unknown future limit), total around $657.3K. This estimate is based on my current contribution, current limit (note the transfer to OA from MA and SA as both have hit the MS limit), include the estimated compound interest and provided I still holding on my job and salary.

Yes, I believe it would be possible to hit $1M CPF if I have sell my HDB and pay cash for my next property or my spouse has been contributing her CPF for the loan repayment.

Thanks and Regards,

Originally Posted by lazyplane

A few points

a. You can still top up your SA provided you invest your SA despite hitting the cap. The min sum applies to the remaining SA that is not invested.

So just invest your SA and you can top up again.

b. You should be paying down your HDB loan first before seeking to return money to your OA . why leave money in OA when you have HDB loan cost slightly higher ?

c. You can still "top back/pay back" OA to earn 2.6% interest for the HDB loan paid by your CPF OA previously. Conceptually, CPF keeps a record of all OA monies drawn used to pay HDB loan + interest . You should be able to determine that sum by logging in via your singpass and checking your statement.

Few people take option c due to the fact that monies kept in CPF do not have the flexibility like cash. You can earn good interest these days in the market. Eg, with the saving bonds that SG gov is launching, that seems to be a better option that putting your monies in CPF OA as the monies is really "locked up" until retirement or purchase of property/ CPF investment.

[lazyplane]

You are right about pt "a". Things have changed.
I think i need an upgrade on my CPF knowledge.

Originally Posted by Unregistered

Hi Lazyplane,

Thank you for your comment.

I agreed with your point "b" and "c".

As for point "a", CPF just clarified that it is not possible to top up MS SA if your total SA and amount invested from SA has reached the MS of SA. Also I don't think there is any good and very safe investment instrument that can generate stable 4% (without capital price fluctuation) compared to interest given in SA.

That's why I seeking from the other poster how to achieve $1M CPF and what he did by paying back the loan taken for property from OA.

From my current status (43yo, single contributor for HDB loan repayment (monthly payment at current interest rate $1.1K) my OA: $59K, SA: $165.8K, MA: $48.5K).

When I turn 55, my estimated CPF (12 years later) would probably be OA: $239K, SA: $369.8K, MA: $48.5K (? unknown future limit), total around $657.3K. This estimate is based on my current contribution, current limit (note the transfer to OA from MA and SA as both have hit the MS limit), include the estimated compound interest and provided I still holding on my job and salary.

Yes, I believe it would be possible to hit $1M CPF if I have sell my HDB and pay cash for my next property or my spouse has been contributing her CPF for the loan repayment.

Thanks and Regards,

How much combined cash savings do you have?
What's the combined value of stocks do you own?

Originally Posted by Unregistered

Hi Lazyplane,

Thank you for your comment.

I agreed with your point "b" and "c".

As for point "a", CPF just clarified that it is not possible to top up MS SA if your total SA and amount invested from SA has reached the MS of SA. Also I don't think there is any good and very safe investment instrument that can generate stable 4% (without capital price fluctuation) compared to interest given in SA.

That's why I seeking from the other poster how to achieve $1M CPF and what he did by paying back the loan taken for property from OA.

From my current status (43yo, single contributor for HDB loan repayment (monthly payment at current interest rate $1.1K) my OA: $59K, SA: $165.8K, MA: $48.5K).

When I turn 55, my estimated CPF (12 years later) would probably be OA: $239K, SA: $369.8K, MA: $48.5K (? unknown future limit), total around $657.3K. This estimate is based on my current contribution, current limit (note the transfer to OA from MA and SA as both have hit the MS limit), include the estimated compound interest and provided I still holding on my job and salary.

Yes, I believe it would be possible to hit $1M CPF if I have sell my HDB and pay cash for my next property or my spouse has been contributing her CPF for the loan repayment.

Thanks and Regards,

Originally Posted by Unregistered

I will turn a blind eye to the implied sarcasm here and treat it that you are ignorant. I dont mind sharing info with people who are genuinely not fully aware, but I dont normally tolerate people who know little but act like they know everything.

The SA cap is currently at $161K (as of Jul 2015).

The thing is about SA is that even when a person reaches this limit, CPF Board will still allocate part of your monthly CPF contributions to the SA. And they also retain the interest earned in the SA every year in the SA! So if you have topped up your SA like I did years ago, your SA amount will always exceed the new annual limit. And as the years go by, because of the compounding interest, the margin grows larger and larger.

On the other hand, they dont do this for the MA. Once the MA reaches the contribution limit, they stop taking your money.

I am 52 and i have 198k in my SA. Like you, i maxed out my SA many years ago.