A 67-year-old retiree holds a record of sorts that most of us would yearn for - she has more than $1.2 million in her Ordinary Account (OA) of the Central Provident Fund (CPF).
If that's not impressive enough, she has another $400,000 in her Retirement Account and over $50,000 in her MediSave account.
These savings allow her to enjoy close to $50,000 in annual interest from the CPF alone.
The obvious million-dollar question is how she achieved such high savings.
It is certainly no mean feat because Janet (not her real name) not only refunded all the money she had withdrawn from the CPF when she was younger, such as for a mortgage, she is still doing something that few retirees would consider - making further contributions.
She is putting in the maximum allowed every year - $37,740 - even though she has been retired for about four years.
Thanks to her own contributions, her Special Account, which was initially depleted after the funds were moved to the Retirement Account, has grown to over $15,000.
In addition, she uses only cash savings for her expenses because she is keen to grow her CPF money further before she starts to draw down when she hits 70, as part of her long-term planning.
Janet, who attached a photograph of her CPF statement in an e-mail as proof of her balances, shared her experience with Invest because she wants to inspire younger Singaporeans so that they can similarly plan for the same outcome.
The key is to start monthly contributions as early as possible, because any monthly income above $6,000 will not be eligible for contribution. So such balances have to be gradually saved over three to four decades.
"I have shown that it can be done," Janet wrote in her e-mail.
She can easily withdraw over $30,000 of interest annually now without affecting her principal sums. She can also access a further $2,000 or more a month from her Retirement Account, but chooses not to do so until she is 70 so that the payout then will be higher.
"I am not trying to show off or anything like that, but to reiterate the point that it is possible to accumulate your savings in CPF and achieve your million-dollar status even at age 55," she notes.
"Like what they say, compounded interest is the eighth wonder of the world and this is particularly true in the case of CPF. This is especially so if you start working from age 25 and then save and grow the money there for the next 40 years."
https://www.straitstimes.com/business/invest/how-retiree-saved-over-16m-in-her-cpf
If that's not impressive enough, she has another $400,000 in her Retirement Account and over $50,000 in her MediSave account.
These savings allow her to enjoy close to $50,000 in annual interest from the CPF alone.
The obvious million-dollar question is how she achieved such high savings.
It is certainly no mean feat because Janet (not her real name) not only refunded all the money she had withdrawn from the CPF when she was younger, such as for a mortgage, she is still doing something that few retirees would consider - making further contributions.
She is putting in the maximum allowed every year - $37,740 - even though she has been retired for about four years.
Thanks to her own contributions, her Special Account, which was initially depleted after the funds were moved to the Retirement Account, has grown to over $15,000.
In addition, she uses only cash savings for her expenses because she is keen to grow her CPF money further before she starts to draw down when she hits 70, as part of her long-term planning.
Janet, who attached a photograph of her CPF statement in an e-mail as proof of her balances, shared her experience with Invest because she wants to inspire younger Singaporeans so that they can similarly plan for the same outcome.
The key is to start monthly contributions as early as possible, because any monthly income above $6,000 will not be eligible for contribution. So such balances have to be gradually saved over three to four decades.
"I have shown that it can be done," Janet wrote in her e-mail.
She can easily withdraw over $30,000 of interest annually now without affecting her principal sums. She can also access a further $2,000 or more a month from her Retirement Account, but chooses not to do so until she is 70 so that the payout then will be higher.
"I am not trying to show off or anything like that, but to reiterate the point that it is possible to accumulate your savings in CPF and achieve your million-dollar status even at age 55," she notes.
"Like what they say, compounded interest is the eighth wonder of the world and this is particularly true in the case of CPF. This is especially so if you start working from age 25 and then save and grow the money there for the next 40 years."
https://www.straitstimes.com/business/invest/how-retiree-saved-over-16m-in-her-cpf
That means she must have a verlee kiam siap person all her life KNN my uncle shared a 400-400-200 formation is much more idealistic KNN
KNN my uncle is looking towards dying as neither a rich nor poor chap in exchange for earlier freedom and adopt the can spend don't waste mantra KNN
