Discussion Forum Forums CPF 3 Reasons why topping up CPF-SA might actually be a good idea

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    Felicia.Ong
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    Topping up CPF-SA benefit

    1) Risk free 4% interest rate (5% on the first S$60,000 of a CPF member’s combined balances

    Unlike investing in the stock market. CPF SA provides risk-free interest rate of up to 5%. It may sound very little, but in a long run and with the magic of compound interest, It’s can actually become quite significant.

    Example: Sam does cash top up of $7000 to his CPF-SA at the age of 35.

    As you can see from the chart above. Over the years without actually doing anything the amount grow from $7000 => $18573 (interest of $11573).

    2) Tax relief of up to $7000 against chargeable income
    Ms Chua Hwee Leng, CPF senior deputy director (retirement schemes), says: “CPF members may enjoy up to $7,000 tax relief for cash top-ups to family members, including to one’s spouse, siblings, parents, parents-in-law, grandparents and grandparents-in-law.

    “Together with cash top-ups into one’s own CPF account, members can enjoy up to $14,000 tax relief.”

    3) Enjoy higher CPF LIFE payouts
    With the introduction of CPF LIFE, Singaporean is now assured of a monthly payout when they reach 65 for as long as they live. However, the amount one receives each month will vary depending on how much one have in their CPF Retirement Account.
    Example:

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