The minimum sum is $123,000.00 for retirement A/C.
If we're over 55, can we use monies in our retirement A/C to buy flat ?
If we're over 55, can we use monies in our retirement A/C to buy flat ?
-
IP addresses are NOT logged in this forum so there's no point asking. Please note that this forum is full of homophobes, racists, lunatics, schizophrenics & absolute nut jobs with a smattering of geniuses, Chinese chauvinists, Moderate Muslims and last but not least a couple of "know-it-alls" constantly sprouting their dubious wisdom. If you believe that content generated by unsavory characters might cause you offense PLEASE LEAVE NOW! Sammyboy Admin and Staff are not responsible for your hurt feelings should you choose to read any of the content here. The OTHER forum is HERE so please stop asking.
Can re-use CPF monies in RA to buy flat ?
- Thread starter Queen Seok Duk
- Start date
bump ************
how come they dun let Singaporeans to use their monies to buy overseas properties?
while Temasek and GIC can use taxpayer monies to buy overseas banks?
i don't get it....LOL!
And the interesting thing is that many Sporns have done way better than Ho Jinx with their overseas investment.
Not surprising lah. Sporeans who invest locally are usually investing in Temasek.
Only the people working in Temasek are protected from bad decisions e.g. no regret Ho Ching
Okay, please. Ho Ching and Temasek have nothing to do with this thread.
The fact is the famiLee has its claws into every Sporean, its part of the Sporean System.
Anything to do with CPF & $$$ in Spore, also involves Temasek. If you ignore this then down the road you may become the victim of another rule change
The fact is the famiLee has its claws into every Sporean, its part of the Sporean System.
Anything to do with CPF & $$$ in Spore, also involves Temasek. If you ignore this then down the road you may become the victim of another rule change
The answer is either you can use your RA to purchase flat or you cannot. Please don't digress.
I think that we should not invest in big ticket items at any age unless we are able to, i.e. have lots of spare and unemcumbered cash available.
But unfortunately, for the sake of face, more and more people are getting themselves into huge debt to "keep up with the Joneses".
If the min sum is 123,000 then u can use anything in excess of $123,000.
if u have $133,000 then u can only use $10,000
Dun B friggin naive............ do you know how the cash flows incl submarine flows??
I'm not saying CPF has nothing to do with Ho Ching and Temasek.
I'm saying it has nothing to do with this thread. If you don't understand this thread, please admit. Otherwise, please justify the relevance of Ho Ching and Temasek to the question asked in this thread.
If you think you want to show off your knowledge, please start another thread.
Last edited:
I'm not asking about withdrawal after 55 so that we get to keep the money for good. I'm asking about re-using the funds for purchase of property, as the property can still be pledged to CPF board.
you can pledge up to 50% for property
The answer is 'No'.
Only if the pledge was done before 55. At 55, should you sell and then buy a property, in between the process your RA will be computed. Proceeds from the sale of your flat will be used to top up any shortfall in the Minimum Sum. And when you then proceed to buy, you will not be using OA or SA because there will not be any OA or SA after 55.
Last edited:
You have problem with understanding this thread ?
CPF: can’t withdraw more at 55 even with property pledge?
Posted by Spiegel on May 23, 2010 28 Comments The CPF Minimum Sum (MS) is the amount a member has to set aside in his or her Retirement Account (RA) for retirement needs. The RA is set up when a member reaches 55 years of age, drawing from savings in the Ordinary and Special accounts (OA and SA respectively). During retirement, the savings accrued in the RA will then be disbursed monthly to the retiree.
At present, the MS is set at $117,000. It will rise to $123,000 with effect from 1 July, as reported in the news recently. CPF members are allowed to pledge property that was bought with CPF funds toward the MS, with the value pledged capped at 50 per cent of the MS.
According to the CPF’s web site, the property pledge for the CPF MS at age 55, has been changed to the following: “If you are unable to set aside your full Minimum Sum in cash, your property, bought with your CPF savings, will be automatically pledged for up to half of the Minimum Sum”.
The important thing to note with this rule is that if the shortfall is less than half of the MS (or $58,500, at the current level), the remaining value of the property ($58,500 less the MS shortfall) becomes irrelevant.
This is different from a previous “property pledge” rule, as seen in this 2003 CPF Board press release, which allows members to choose to pledge their property for up to half the MS.
Under this rule, members who are unable to meet the MS are allowed to pledge their property for up to the full 50 per cent of the MS – rather than just making up for the shortfall. Therefore, if their MS shortfall is less than the 50 per cent of the required amount, the remainder from the property pledge would translate into funds available for withdrawal.
Here’s an illustration. Currently, in the example given in the new CPF booklet “Reaching 55”, a person with $100,000 in the CPF Ordinary (OA) and Special Accounts (SA) can withdraw 30 per cent, which is $30,000.[1]
Under the new “property pledge” rule, the MS shortfall of $47,000 (current MS of $117,000 less the $70,000 retained in the RA) will automatically be pledged with property.
Under the old “property pledge”rule, this person would have been able to pledge the full 50 per cent of the MS, which is $58,500. This means he or she would be able to withdraw $41,500 (from the $100,000 in his or her OA and SA, less $58,500), as compared to just $30,000 under the new rule.
Another implication of this new rule will take effect in 2013. For members who turn 55 on or after 1 January 2013, the CPF cash balance can only be withdrawn after setting aside both the CPF MS and Medisave Minimum Sum. If this is not met, they can withdraw only $5,000 from their CPF account, regardless of any property pledge.
With the MS in 2013 being likely to be $135,000, assuming the current rate of increase of $6,000 per year remains constant, there may be more people who will face an MS shortfall when they turn 55.
Furthermore, since February 2009 , property sale proceeds must be retained in the RA if there is a shortfall in the MS. In some cases, where the member’s MS shortfall is too great, the property sale proceeds retained may be even more than 50 per cent of the MS. Part or even all of the net sale proceeds may not be available for the member to buy another property.
The view that one’s HDB flat is an asset enhancement – something one can monetised for retirement – may increasingly become less valid, with the MS increasing every year.
Given all the significance this “property pledge” rule change has on CPF members, it should be asked as to why there was no announcement made in Parliament or to the media?
To be sure, even the previous CPF booklet “Reaching 55” (attached) covering the period 1 July 2009 to 30 June 2010 showed the new “property pledge” rule.
So when exactly was this rule changed?
--------------------------------------------------------------------------------
[1] The booklet states that “the figures here apply to members who turn 55 from 1 July 2010 to 31 December 2010”. I believe that this is because the Medisave Required Amount (MRA), currently fixed at $22,500, is scheduled for its annual increase on 1 January 2011.
__________________
By Leong Sze Hian
____________________________________
Posted by Spiegel on May 23, 2010 28 Comments The CPF Minimum Sum (MS) is the amount a member has to set aside in his or her Retirement Account (RA) for retirement needs. The RA is set up when a member reaches 55 years of age, drawing from savings in the Ordinary and Special accounts (OA and SA respectively). During retirement, the savings accrued in the RA will then be disbursed monthly to the retiree.
At present, the MS is set at $117,000. It will rise to $123,000 with effect from 1 July, as reported in the news recently. CPF members are allowed to pledge property that was bought with CPF funds toward the MS, with the value pledged capped at 50 per cent of the MS.
According to the CPF’s web site, the property pledge for the CPF MS at age 55, has been changed to the following: “If you are unable to set aside your full Minimum Sum in cash, your property, bought with your CPF savings, will be automatically pledged for up to half of the Minimum Sum”.
The important thing to note with this rule is that if the shortfall is less than half of the MS (or $58,500, at the current level), the remaining value of the property ($58,500 less the MS shortfall) becomes irrelevant.
This is different from a previous “property pledge” rule, as seen in this 2003 CPF Board press release, which allows members to choose to pledge their property for up to half the MS.
Under this rule, members who are unable to meet the MS are allowed to pledge their property for up to the full 50 per cent of the MS – rather than just making up for the shortfall. Therefore, if their MS shortfall is less than the 50 per cent of the required amount, the remainder from the property pledge would translate into funds available for withdrawal.
Here’s an illustration. Currently, in the example given in the new CPF booklet “Reaching 55”, a person with $100,000 in the CPF Ordinary (OA) and Special Accounts (SA) can withdraw 30 per cent, which is $30,000.[1]
Under the new “property pledge” rule, the MS shortfall of $47,000 (current MS of $117,000 less the $70,000 retained in the RA) will automatically be pledged with property.
Under the old “property pledge”rule, this person would have been able to pledge the full 50 per cent of the MS, which is $58,500. This means he or she would be able to withdraw $41,500 (from the $100,000 in his or her OA and SA, less $58,500), as compared to just $30,000 under the new rule.
Another implication of this new rule will take effect in 2013. For members who turn 55 on or after 1 January 2013, the CPF cash balance can only be withdrawn after setting aside both the CPF MS and Medisave Minimum Sum. If this is not met, they can withdraw only $5,000 from their CPF account, regardless of any property pledge.
With the MS in 2013 being likely to be $135,000, assuming the current rate of increase of $6,000 per year remains constant, there may be more people who will face an MS shortfall when they turn 55.
Furthermore, since February 2009 , property sale proceeds must be retained in the RA if there is a shortfall in the MS. In some cases, where the member’s MS shortfall is too great, the property sale proceeds retained may be even more than 50 per cent of the MS. Part or even all of the net sale proceeds may not be available for the member to buy another property.
The view that one’s HDB flat is an asset enhancement – something one can monetised for retirement – may increasingly become less valid, with the MS increasing every year.
Given all the significance this “property pledge” rule change has on CPF members, it should be asked as to why there was no announcement made in Parliament or to the media?
To be sure, even the previous CPF booklet “Reaching 55” (attached) covering the period 1 July 2009 to 30 June 2010 showed the new “property pledge” rule.
So when exactly was this rule changed?
--------------------------------------------------------------------------------
[1] The booklet states that “the figures here apply to members who turn 55 from 1 July 2010 to 31 December 2010”. I believe that this is because the Medisave Required Amount (MRA), currently fixed at $22,500, is scheduled for its annual increase on 1 January 2011.
__________________
By Leong Sze Hian
____________________________________
Thanks, SzeHian. May I seek your clarification on this:
How to reconcile the figure $175,715 with the definition of Minimum Required Amount ?
The Booklet on page 6 defines MRA as follows:
The Medisave Required Amount is the amount in your MA that you ought to have from 55. If you have the Minimum Sum fully in cash at 55 but do not have the Medisave Required Amount, you have to transfer part of your OA/SA savings to your MA before you can withdraw the rest of your OA/SA savings.
But if look at page 19, Step 3 where the estimated amount one can withdraw at 55 if her X is more than $175,715 (where X = OA ＋ SA + excess of MMS), it says one can withdraw X - $175,715 - MRA shortfall.
The definition of the MRA as described above says "if you have the Minimum Sum fully in cash at 55". Shouldn't that mean $123,000 ? But Step 3 seems to suggest the Minimum Sum is $175,715.
Similar threads
