Thanks Mr Loo for this timely video. Thanks for the 3 options. Yes, this is impacting 'negatively' including myself. Although I still have about a decade before reaching 55, but need to start thinking from now. For me, is seeing from current pros and cons: Option 1 (keep it in OA with 2.5%): definitely not for me. Option 2 (transfer OA to RA up to 4x BRS) is even riskier. It seems almost the same with before changes that RA can only be withdrawn monthly via CPF Life. But who knows what other changes in CPF Life? The pooling, the probably shrinking monthly payout due to help other members etc.? Option 3 (invest excess SA in other thing): probably this is the only choice i would choose. Provided they still allow us to use OA to invest in endowus, T Billm fixed deposit etc which gives (potentially give) more than 2.5%.
If u read the detail on RA: payout is subjected to change. Hence the $3530 or$3350is not a firm figure even u dump ur $ to fulfill the 400k+ RA. Imagine rules changes along the way n Remember RA money u cannot withdraw as u like ??
@@morgankl797 i second it. i commented on the same topic regarding RA withdrawal from 65 years onwards. @uditbandung 2 days ago Tbh, after today announcement, I'm not even sure after 65 years old how would be the cpf life payout look like. Later change again due to the needs to reassess the pooling, which could probably decrease your monthly payout or delay further. Who knows? :(
You should not just start thinking now. It will affect you eventually. So fix it now before its too late. You should start protesting against this scheme so that the CPF will revert like the LTA. This government is getting worse with their policies. Its time we change them.
Key takeaway is that you can plan as much as you want, but remember that the gov't can suka suka change things. Maybe next time FRS x3 ERS x5 with BRS increasing. nobody knows. don't count your chickens before they hatch
If I am not wrong, interest earned under RA does not belong to the individual but is pooled interest as those born in and after 1958 they are automatically enrolled into CPF life and that is a pooled interest. So technically it is NOT right to say “YOU earn more interest, because the interest does not belong to you per say. Right?
agree. The mission is to allow as many CPF members to achieve a comfortable retirement, not to provide a "super-high interest, super-low risk Savings Account" to the CPF rich.
@@pathfinder1672 Once you hit the Full Retirement Sum, basic needs for retirement objective is achieved. The rest are WANTS and not MUSTS. WANTS should not given preferential treatment in terms of higher interest free returns. Go elsewhere. Not free lunch.
CPF is certainly a good saving vehicle, but the problem that kept me from injecting money into CPF was because having to lock my money till 55yo, and risk of policies change, such as revised to lower interest rate, increase in retirement amount, later withdrawal year (55yo to 60/65yo) and for instances, the change in SA today.
I met officer at CPF office before CNY on my Retirement plan and earning higher interest from my CPF A/c. He made it clear CPF is not meant to be investment fund. You should do your investment outside of CPF he said.
OK, so we are correcting the wrong - whereby a higher interest rate was paid for funds that could be withdrawn. And the principle is that if the funds are available for withdrawal, then the rate is lower. OK, so are we going to be consistent then? What about those BELOW age 55? They can't withdraw their money. So applying the principles means that those below age 55 should be paid 4% in the OA account, right? So is there consistency with the principles? Does not appear so.
What happens if one goes for option 3 and with risks and ends up losing more $ and then faces financial stress at a ripe age? It will be another problem
With this move, a potential backlash is people may exercise their frustration at the polls. Perhaps budget should have covered more on the reasons for this shift on SA closure as now there is a lot of speculation going on. The biggest worry the public has is not the closure of the SA but what would stop the govt from making any changes along the way according to their whim and fancy. Some could include delaying withdrawal age or increasing the ERS to 6X. Many changes to impose could be cited on matters of principal such as delaying withdrawals as people are living longer. I won't be surprised if one day cpf cannot be used for housing as the principal would cite that it is for retirement. The list goes on...
dun worry. the frustrated people are not even those hitting FRS. they are usually the poorer population who cant help themselves, which either way would have voted for opposition already.
They don’t care a damn about the consequences for not voting them because USA is its protector. So long they obediently comply to every USA demand, your vote is nothing but a piece of toilet paper.
The CPF change may also a boost for the banks and retail investment firms. The people immediately affected are those > 55 and few are savy-investors. Given the low risk appetite, either they keep the SA $$$ in OA, FD or handover to the "pros" to manage for them.
The scrapping of the SA will mostly affect only those with money. The savings can help fund the Silver program. It has really helped a lot of old and needy people.
WE MUST tell CPF, and our MP we hate it and we are going to fight it! The government do as they like. They do not bother about our future. This PAP must stop
Here's my view. The new government will not look out for you (mid income). They know the loop hole but they decided to close it. They will force the middle class to rethink how we vote for the new government. I'm very disappointed with our next PM for not support the young senior on their CPF strategy (maybe he thinks we are stupid). He is just buying votes for the low income household.
This closing of SA has no effect if a person entire working life is to achieve sufficient FRS upon 55. This only is a problem for low wage earners ,which is already a problem irregardless whether SA gets closed at 55 or not, cos such low wage folks, after paying their HDB loan,would have insufficent in either in their RA or SA. So the best option is have a property which is fully paid up by 55 using CPF in part and yet have the huge capital gain retained in the asset value. Cos the 4 % or so ,CPF can pay out cannot beat the yield of capital gain of asset brought by using CPF and also the rental yield one would get from this asset. So the gain through asset investment is DOUBLE and of much higher yield too. Depending and hoping for that 4% or so from CPF either from OA or SA is but poor financial management on the part of that CPF holder ,where he or she would had harnass a much much bigger yield using asset based investment rather than that 4% and yet get to fulfil their FRS either through asset liquidation or for passive income in retirement.
Are middle income people now seen as being rich? The rich have other means of making money outside of CPF. It's the middle income who have used CPF SA to grow a little bit more of their savings. I don't think they using their SA 4% interest to fly 1st class for holidays like the rich people do.
Agreed ! This is mostly middle income people who are looking for ways to grow their retirement nest. For the rich, they have bank RM or other means to find ways to grow their money.
So they are trying to fill up the loophole. I guess Im still on the less impact group since I'm still saving for the FRS. I agree this one affects the CPF rich elderlies.😂
Please confirm that once you take out your money from your OA and put in FD with commercial banks for better interest rate, you can’t put back into your OA again when the bank rate is not favourable compared with the 2.5 % in the CPF OA.
They raised the employer CPF contribution from 55 also.. so I guess they want those of 55 years old to continue working..if you are still working the extra employer CPF contribution should counter the difference in interest rate of SA to OA..
In SG when got good lobangs shld just 'enjoy quietly'. Not blaming anyone but when I see so many local YTbers junping in to make vids abt CPF shielding and publicising ti's 'loop hole', its clamp down isn't a big surprise really. Maybe Mr Loo need to change his 1M65 name liao😅 someone in our parli cannot stand too many 'Snr CPF millionaires"😅
recently there alot of these kind of video after CPF Board change their Rule, but i dont care what happen to the rule change, as i reach 65 years old, my month withdrawn is already enough to use, as my wife will drawn hers RA 1 years after me.
So if you are still working from 55 to 65, and enjoy the 1.5% extra employer CPF contribution.. you can move your OA funds after FRS to ur RA, make 4% interest and still enjoy a 1.5% extra employer CPF.. and work till U are 65.. then retire? Isn't that good?
CPF SA was formed in 1977. For 46 years,the govt was "unprincipled"?? I don't think LW has the right to say that LKY, GCT and LHL govts have been unprincipled all these years. Is it principled to allow a sum of money (CPF OA) limited use (education and housing) for 30 years (25 - 55yo) based on a 2.5% interest??
The basic principle still stands, to encourage every Singaporean to earn, save and retire sustainably through the CPF scheme. But now under the pressure of an aging population, there is an increasing need for money to support the less-well off even more. Hence Minister Wong needs to squeeze the last drop of cash from the budget without sacrificing everything else which is important. With the focus on helping the poor more than the rich, the reduction of interest rates paid to the rich via is SA is equitable and timely. This extra cash which could have been used to add a little more interest on the extra cash of the well-to-do can now be used to fund GST and CDC transfers to the less well-off.
@@hanyenchan perhaps this "principled" govt can ask themselves WHY estate tax was abolished years ago? Perhaps this "principled" govt can ask themselves why COE is allocated on a price mechanism basis (advantaging the rich) rather than on a need basis? Perhaps this "principled" govt can ask what's the principle of high taxes on harmful stuff like smoking rather than an outright generational ban? And @hanyenchan, to couch this move as being equitable is not accurate. As far as I know, every Singapore resident, rich or poor has a cpf account the moment they are born. It's only a matter of how much is there in their accounts. Hence everyone (rich or poor) has a cpf SA account that previously would have extended beyond 55 yo. So this particular measure took money from every SG resident (Regardless of race, language, religion, and wealth levels) from newborn to the oldest person in SG
Some folks save hard and top up their SA for more money when they retire. They are the most angry ones, I guess. Will the SA Top up scheme be scraped? Will VC3A still be available next year?
Correct but for those poor family the high interest serve no meaning if they don’t have enough food on table at least after they 55 years if they continue working they still can withdraw for emergency needs , this SA to RA only benefits those who have high amt in SA, sign
Morale of the story:Look for other investment vehicles that generate above 2.5% if you want liquidity.Just max out the ERS & get the monthly payout after 65.This is provided you have the money after paying off your mortgage 😢
Tbh, after today announcement, I'm not even sure after 66 years old how would be the cpf life payout look like. Later change again due to the needs to reassess the pooling, which could probably decrease your monthly payout or delay further. Who knows? :( I agree and would do the same to invest my OA after 55 years old. No choice :(
Not very similar to fixed D because fixed D tend to give more interest rate, for shorter period of time. This one give you more interest rate but lock in long period of time.
You may not have realised that you TOO (like all other poor/medium class/rich persons in SG) have a CPF SA account that was supposed to have extended beyond 55 yo. If this was truly a move meant to be equitable, the govt would restrict the max balance of CPF SA post 55 instead of abolishing it totally. Remove your blinkers
Half a million in CPF is NOTHING when you are jobless at age 55 or 60yrs old… inflation is going to rise faster and a bowl of noodle is going to cost $12-15 easily
After listening, i think still not bad leh, afterall it is 4% risk free! If take out and invest, the return must be much higher than 4% to be worth the risk
The issue is not invest the SA (before or after 2025) but getting 4.08% interest every year if SA still around. Mr Loo is diverting your attention from the main issue here which is the TERMINATION of the SA which is hurting many CPF members!
@@frjuy Precisely there is no more liquidity between 55 to 65 years old. Not sure you know if you top up full ERS 4x ... yah you get a higher payout BUT YOUR INTERESTS ACCRUED AFTER 65 IS NOT YOURS ANYMORE? PLUS YOU CANT SEE THE BALANCE UNTIL YOU DIE WHEN YOUR BENEFICIARIES GET BACK THE PRINCIPAL. DO SINGAPOREANS KNOW? ITS A SCAM MAN!
Current RA scheme is you need the paid premium; more payout more premium need to be deducted from your RA is good for insurance company not like the previous scheme no premium.
Those who have good balances in the SA and could have earned 4.08% must ask themselves this important question. With the SA removed, would you be getting more rebates, CDC vouchers, whatever gimmicks they give ... than the interest you would have if the SA was left intact? The likely answer is NO!
The SA account was a favorite for rich CPF people because of its high interest of 4%. Now they have to decide which financial instruments in the public space to invest which can fetch 4%. Sg Treasury bills fetch 3.3%. Bond interest maybe lower. On riskier instruments is stock. So these decisions may not sit comfortably with some people because they need to choose. They may lose money like earning less interest if they buy treasury bills. Some chose to buy stocks but they lost 33% of the money after buying Alibaba stock a year ago. So no good options left for risk averse people.
Hmmm just curious, how many really take out their sa frequently? It is not easy to know how much to put into ra as our life span is different from ppl to ppl. Hindsight is that ppl who most money in ra will have less likely to be scammed
Precisely, it's always better to depend on yourself than to blindly believe that policy will always remain the same. The biggest flaw behind this 1M65 movement is to naively assume it is risk free
Are we sure pap will allow us to withdraw OA anytime? If damn scary to have pap ruling us in the past 50yrs like they stopped full withdrawal at 55, moving target for the limit and now this move to close the SA...
So many people i know at 55 OA can take out what's beyond the minimum. Assuming they were mid-high income earner. Stop this no evidence based fear mongering.
i tot at 55 OA is lock, now they change any reminding goes to OA, meaning to say country is in trouble need $$, they are trying to increase the price of properties. because OA can use for buy house.i a little bit confuse, correct me if i wrong
With this new deletion of SA..can we still pledge half the FRS to make it to BRS..?the excess go to OA then right ? pls clarify? Because there are people who still works after 55 and their mthly cpf contribution be distributed to OA ,SA and medisave previously?
I wouldn’t have minded it so much if the govt had allowed those who have already reached 55 yrs old to maintain their SA accounts instead of pulling the rug out from under them.
Yes. Instead of forcing them to invest elsewhere with higher risks, it is better to encourage them to keep in CPF. What is 4% interest compare to the return GIC get from their larger funds investment. Should help the ordinary citizens to grow together. This will also reduce govt burden if one do not invest wisely outside of CPF.
Agree ti's is basically leaving these folks in the lurch, after they worked hard to save up the money for the bit of extra interest. So much for 'leaving no one behind" but if u dare get a lil ahead...!
It is easy, I did my shielding of SA, with this changes , I will take all my shield SA and put to DBS post dividend and bonus issue shares as price will drop and I will still get 6% dividend yield. Quite simple actually
Don't assume DBS will always stay at this price, it has dropped below $10 in 2009. The dividend yield will not make up for the drop in price. At current price of $30+, it is already almost at all time high. With upcoming expected drop in interest rate, we all know price will eventually drop
@@pathfinder1672 you should never buy only I can buy DBS as I have been doing so for the last 10 years . I prefer only I benefit from this and not everyone else
@@pathfinder1672 Yes agree. All the super rich in the world have already gathered here. There is not going to be another tsunami of richie riches coming again. This is the super peak already. Thats why DBS CEO dropped his shares.
Mr Loo. I need some clarification. Interest earned under RA cannot be withdrawn, no? so after 55 when the FRS goes into the RA and not SA, that 4.08% you can take meh?
The goalpost has been shifted, once again. How many times hv the rules been changed when its members followed thru n starts to reap benefits from rules set by cpf. This “follow thru” period is also a form of sacrifice. However, this change has the potential to increase money supply to further inflate prices(in yr expense).
after the 10 years of 4.08% annual interest compounded , $426,000 become $635,444 approximately, so $3330 x 12 divided by $635,444 x100 = 6.288% round up to 6.29%
@@NinJa-qr1sp yes u are right. Since they ERS is rdy set. Why not let ppl top up. Then at age 55 only the ERS amount is left. Balance can transfer to OA. Like that would fulfill the principle of holding money long term for long term gains
Hi @1M65 , if after 55 yrs old, i have left only $205,800 in my frs, my OA left $0, 1st jan of each yr, will some frs interest $ will go to my OAaccount?
@carnesir - you may not have realised that you TOO (like all other poor/medium class/rich persons in SG) have a CPF SA account that was supposed to have extended beyond 55 yo. If this was truly a move meant to be equitable, the govt would restrict the max balance of CPF SA post 55 instead of abolishing it totally. Remove your blinkers
@@ocswoodlands agreed. Gov should keep SA with a cap not higher than ERS (RA+SA). And allow those above 55 to work and continue to contribute to their SA.
What’s the Dividend Withholding Tax that everyone seems to talk about? Singapore investors are subjected to a 30% U.S. dividend withholding tax on all dividends received from U.S. listed equities (i.e. stocks, ETFs, bonds, mutual funds, etc) because Singapore doesn’t currently have a tax treaty with the U.S. This means for every $100 dividend you get from stocks or investments in the US markets, only $70 reaches you.
Don't complain, think who U voted, now U know they give U chicken wing, and time to get back the whole chicken. that's 1.5% of interest missing, go calculate how much U can get.
This is why the we should never assume that CPF gives risk free returns. Nothing in life is risk free
Thank you thank you very much for this explanation, simple and easy to understand ❤
A big Thank You to Mr Loo! Much Appreciate! ❤
Thanks Mr Loo for this timely video. Thanks for the 3 options. Yes, this is impacting 'negatively' including myself. Although I still have about a decade before reaching 55, but need to start thinking from now.
For me, is seeing from current pros and cons:
Option 1 (keep it in OA with 2.5%): definitely not for me.
Option 2 (transfer OA to RA up to 4x BRS) is even riskier. It seems almost the same with before changes that RA can only be withdrawn monthly via CPF Life. But who knows what other changes in CPF Life? The pooling, the probably shrinking monthly payout due to help other members etc.?
Option 3 (invest excess SA in other thing): probably this is the only choice i would choose. Provided they still allow us to use OA to invest in endowus, T Billm fixed deposit etc which gives (potentially give) more than 2.5%.
If u read the detail on RA: payout is subjected to change. Hence the $3530 or$3350is not a firm figure even u dump ur $ to fulfill the 400k+ RA. Imagine rules changes along the way n Remember RA money u cannot withdraw as u like ??
@@morgankl797 i second it. i commented on the same topic regarding RA withdrawal from 65 years onwards.
@uditbandung 2 days ago
Tbh, after today announcement, I'm not even sure after 65 years old how would be the cpf life payout look like. Later change again due to the needs to reassess the pooling, which could probably decrease your monthly payout or delay further. Who knows? :(
You should not just start thinking now. It will affect you eventually. So fix it now before its too late.
You should start protesting against this scheme so that the CPF will revert like the LTA.
This government is getting worse with their policies. Its time we change them.
Agree, it is the right thing to do.
Appreciate for the update, clearer now.
Key takeaway is that you can plan as much as you want, but remember that the gov't can suka suka change things. Maybe next time FRS x3 ERS x5 with BRS increasing. nobody knows. don't count your chickens before they hatch
U can also suka suka vote for the best.
@@chanmk28like who? Lim thean? Lol. Its NOT who u vote. Is who you actually have LEFT to vote
Suka suka? Nobody is forcing you to contribute more than FRS. Don't suka suka say.
@@chanmk28or suka suka vote you THOUGHT is the best, but turns out 💩
@@Longtermalwayswins ya lor. left or right..also die cock stand
Thanks for the update. Need to consider hard whether to increase to ERS or to invest it elsewhere
If I am not wrong, interest earned under RA does not belong to the individual but is pooled interest as those born in and after 1958 they are automatically enrolled into CPF life and that is a pooled interest. So technically it is NOT right to say “YOU earn more interest, because the interest does not belong to you per say. Right?
We have to remember this. CPF's mission is on RETIREMENT. All their programs must align with the mission.
Retirement means allowing everyone the chance to grow their CPF money at 4%. This is remove once SA is close in 2025.
@@pathfinder1672 that chance is called RA (Retirement Account)
agree. The mission is to allow as many CPF members to achieve a comfortable retirement, not to provide a "super-high interest, super-low risk Savings Account" to the CPF rich.
@@pathfinder1672 Once you hit the Full Retirement Sum, basic needs for retirement objective is achieved. The rest are WANTS and not MUSTS. WANTS should not given preferential treatment in terms of higher interest free returns.
Go elsewhere. Not free lunch.
@@pathfinder1672 Join RA then. Same 4%. Same as other members. No special privilege. r
Thank you Mr Loo for making time to explain.
You’re always welcome!
CPF is certainly a good saving vehicle, but the problem that kept me from injecting money into CPF was because having to lock my money till 55yo, and risk of policies change, such as revised to lower interest rate, increase in retirement amount, later withdrawal year (55yo to 60/65yo) and for instances, the change in SA today.
I met officer at CPF office before CNY on my Retirement plan and earning higher interest from my CPF A/c. He made it clear CPF is not meant to be investment fund. You should do your investment outside of CPF he said.
OK, so we are correcting the wrong - whereby a higher interest rate was paid for funds that could be withdrawn. And the principle is that if the funds are available for withdrawal, then the rate is lower. OK, so are we going to be consistent then? What about those BELOW age 55? They can't withdraw their money. So applying the principles means that those below age 55 should be paid 4% in the OA account, right? So is there consistency with the principles? Does not appear so.
OA can be used for housing and education at the moment
All this while no 'wrong' suddenly 新官上任 new ppl new method now need to "correct the wrong" ? 😅Brace yourself for more 'shocks' coming!
If you don't want the flexibility of using OA for investment, housing, education etc, feel free to transfer the OA funds to SA.
What happens if one goes for option 3 and with risks and ends up losing more $ and then faces financial stress at a ripe age? It will be another problem
Thks Mr Loo for the good sharing.
With this move, a potential backlash is people may exercise their frustration at the polls. Perhaps budget should have covered more on the reasons for this shift on SA closure as now there is a lot of speculation going on.
The biggest worry the public has is not the closure of the SA but what would stop the govt from making any changes along the way according to their whim and fancy. Some could include delaying withdrawal age or increasing the ERS to 6X.
Many changes to impose could be cited on matters of principal such as delaying withdrawals as people are living longer. I won't be surprised if one day cpf cannot be used for housing as the principal would cite that it is for retirement. The list goes on...
Skali cannot even withdraw from OA even above FRS in RA lol
dun worry. the frustrated people are not even those hitting FRS. they are usually the poorer population who cant help themselves, which either way would have voted for opposition already.
Well, withdrawal age has been raised couple times n there’s MS n CPFlife to minimise withdrawal.
It's clear that the CPF is meant for retirement adequacy. Not a risk free high interest savings account after you turn 55.
They don’t care a damn about the consequences for not voting them because USA is its protector. So long they obediently comply to every USA demand, your vote is nothing but a piece of toilet paper.
Bravo to PAP!
Agreed, it is a matter of principle.
Comes a bit too late
Do you know that interest earn in RA after 65 is going into cpflife pool, so putting more in ERS is disadvantage to those who don't live much longer.
This fact is not known to many people. They think it is the same 4% interest earned in RA.
Will interests earn in RA fr 55 to 64 be pooled if the person dies before 65?
those who don't live much longer, everything else doesn't matter anymore, regardless of advantage or disadvantage.
Agreed.
Under cpf life, choose Basic plan which only 10-20% of e funds is premium to cpf life, not e entire interest generate by principal sum. See cpf link
The CPF change may also a boost for the banks and retail investment firms. The people immediately affected are those > 55 and few are savy-investors. Given the low risk appetite, either they keep the SA $$$ in OA, FD or handover to the "pros" to manage for them.
The scrapping of the SA will mostly affect only those with money. The savings can help fund the Silver program. It has really helped a lot of old and needy people.
WE MUST tell CPF, and our MP we hate it and we are going to fight it!
The government do as they like. They do not bother about our future.
This PAP must stop
Never put all your eggs in one basket. CPF is just one pillar of our retirement plan.😌
Here's my view. The new government will not look out for you (mid income). They know the loop hole but they decided to close it. They will force the middle class to rethink how we vote for the new government. I'm very disappointed with our next PM for not support the young senior on their CPF strategy (maybe he thinks we are stupid). He is just buying votes for the low income household.
First increase gst, now he close SA, what next?!
Thanks to the kaypoh Radin Mas MP Melvin Yong for stirring the shit in parliament, 😂😂. He needs all your support in the coming GE. 🎉🎉
This closing of SA has no effect if a person entire working life is to achieve sufficient FRS upon 55. This only is a problem for low wage earners ,which is already a problem irregardless whether SA gets closed at 55 or not, cos such low wage folks, after paying their HDB loan,would have insufficent in either in their RA or SA.
So the best option is have a property which is fully paid up by 55 using CPF in part and yet have the huge capital gain retained in the asset value.
Cos the 4 % or so ,CPF can pay out cannot beat the yield of capital gain of asset brought by using CPF and also the rental yield one would get from this asset.
So the gain through asset investment is DOUBLE and of much higher yield too.
Depending and hoping for that 4% or so from CPF either from OA or SA is but poor financial management on the part of that CPF holder ,where he or she would had harnass a much much bigger yield using asset based investment rather than that 4% and yet get to fulfil their FRS either through asset liquidation or for passive income in retirement.
There is option 3' for those who are younger than 55. Just put BRS amount into RA. The rest, invest. Own self take care of own self lah.
Those younger than 55 don't have RA. What talking you?
🤦♂@@vroom178
Haha this is the result of making the concept of shielding so public! 🤣
Remember Melvin Yong , the MP.
Second
Are middle income people now seen as being rich? The rich have other means of making money outside of CPF. It's the middle income who have used CPF SA to grow a little bit more of their savings. I don't think they using their SA 4% interest to fly 1st class for holidays like the rich people do.
Agreed ! This is mostly middle income people who are looking for ways to grow their retirement nest. For the rich, they have bank RM or other means to find ways to grow their money.
So they are trying to fill up the loophole. I guess Im still on the less impact group since I'm still saving for the FRS. I agree this one affects the CPF rich elderlies.😂
Please confirm that once you take out your money from your OA and put in FD with commercial banks for better interest rate, you can’t put back into your OA again when the bank rate is not favourable compared with the 2.5 % in the CPF OA.
They raised the employer CPF contribution from 55 also.. so I guess they want those of 55 years old to continue working..if you are still working the extra employer CPF contribution should counter the difference in interest rate of SA to OA..
with the new changes, what advice can you give younger generation people who just started working? Should they aim to hit FRS still?
SA shielding no longer possible!
In SG when got good lobangs shld just 'enjoy quietly'. Not blaming anyone but when I see so many local YTbers junping in to make vids abt CPF shielding and publicising ti's 'loop hole', its clamp down isn't a big surprise really. Maybe Mr Loo need to change his 1M65 name liao😅 someone in our parli cannot stand too many 'Snr CPF millionaires"😅
2.5%, 4% returns. Each years CPF invest using contributor’s savings. How much is the ROI for each year in the last 10 or 20 years.
I still can remember 'you can enjoy 1 more %', what's a conman.
recently there alot of these kind of video after CPF Board change their Rule, but i dont care what happen to the rule change, as i reach 65 years old, my month withdrawn is already enough to use, as my wife will drawn hers RA 1 years after me.
So if you are still working from 55 to 65, and enjoy the 1.5% extra employer CPF contribution.. you can move your OA funds after FRS to ur RA, make 4% interest and still enjoy a 1.5% extra employer CPF.. and work till U are 65.. then retire?
Isn't that good?
The govt have become incompetent to generate the current interest rate. It’s better the cpf be released back to the people to self manage.
CPF SA was formed in 1977. For 46 years,the govt was "unprincipled"??
I don't think LW has the right to say that LKY, GCT and LHL govts have been unprincipled all these years.
Is it principled to allow a sum of money (CPF OA) limited use (education and housing) for 30 years (25 - 55yo) based on a 2.5% interest??
The basic principle still stands, to encourage every Singaporean to earn, save and retire sustainably through the CPF scheme. But now under the pressure of an aging population, there is an increasing need for money to support the less-well off even more. Hence Minister Wong needs to squeeze the last drop of cash from the budget without sacrificing everything else which is important. With the focus on helping the poor more than the rich, the reduction of interest rates paid to the rich via is SA is equitable and timely. This extra cash which could have been used to add a little more interest on the extra cash of the well-to-do can now be used to fund GST and CDC transfers to the less well-off.
@@hanyenchan perhaps this "principled" govt can ask themselves WHY estate tax was abolished years ago? Perhaps this "principled" govt can ask themselves why COE is allocated on a price mechanism basis (advantaging the rich) rather than on a need basis? Perhaps this "principled" govt can ask what's the principle of high taxes on harmful stuff like smoking rather than an outright generational ban?
And @hanyenchan, to couch this move as being equitable is not accurate.
As far as I know, every Singapore resident, rich or poor has a cpf account the moment they are born. It's only a matter of how much is there in their accounts. Hence everyone (rich or poor) has a cpf SA account that previously would have extended beyond 55 yo.
So this particular measure took money from every SG resident (Regardless of race, language, religion, and wealth levels) from newborn to the oldest person in SG
Generational ban is in the works, be patient.
LW has step on too many ordinary folks toes now 😡😡😡
@@ocswoodlandsagree. It’s taking away one’s birth rights”.
Some folks save hard and top up their SA for more money when they retire. They are the most angry ones, I guess. Will the SA Top up scheme be scraped?
Will VC3A still be available next year?
PAP will loose the majority of the vote from senior citizen.
Young people too
PAP gd 👍👍👍
That’s for sure
Don't worry the pap logo is unbreakable :)
They don't know yet.. 😉
The way you explain so round about.
Show the PAP your resentment in the coming poll.
I don’t believe rationale about fairness / equity. I think it’s more about reducing outgoings and financing CPF Life for those who live ‘too long’.
Correct but for those poor family the high interest serve no meaning if they don’t have enough food on table at least after they 55 years if they continue working they still can withdraw for emergency needs , this SA to RA only benefits those who have high amt in SA, sign
Angry? Just vote the PAP out!
Morale of the story:Look for other investment vehicles that generate above 2.5% if you want liquidity.Just max out the ERS & get the monthly payout after 65.This is provided you have the money after paying off your mortgage 😢
Tbh, after today announcement, I'm not even sure after 66 years old how would be the cpf life payout look like. Later change again due to the needs to reassess the pooling, which could probably decrease your monthly payout or delay further. Who knows? :(
I agree and would do the same to invest my OA after 55 years old. No choice :(
at 55 plus still learn to risk our hard saving $$$ or risk lost via inflation ?
@@tanhakkoon maybe try less risk platforms like T bill, fixed d, anything above 2.5% pa.
@@uditbandung T bill interest likely going down as Fed said. Still cannot cope with SG 3-4 % annual inflation in long term.
@@uditbandung T-bill was once below 1% and it will eventually return back to this number in the future.
Not very similar to fixed D because fixed D tend to give more interest rate, for shorter period of time. This one give you more interest rate but lock in long period of time.
🤬Pay and Pay..shifting the goalpost time and again.
It is a safety net program but rich ppl are using it as a wealth building tool. It's time to adjust this.
You may not have realised that you TOO (like all other poor/medium class/rich persons in SG) have a CPF SA account that was supposed to have extended beyond 55 yo.
If this was truly a move meant to be equitable, the govt would restrict the max balance of CPF SA post 55 instead of abolishing it totally.
Remove your blinkers
Half a million in CPF is NOTHING when you are jobless at age 55 or 60yrs old… inflation is going to rise faster and a bowl of noodle is going to cost $12-15 easily
CPF has cash flow issue. Cannot sustain the 4.xx% Previously CPF talked so much. Actually full of AIR.
My friends take all their cpf to enjoyed before passed away but now we take only a small amounts and cpf used for their investments and earned alot
After listening, i think still not bad leh, afterall it is 4% risk free!
If take out and invest, the return must be much higher than 4% to be worth the risk
😂😂😂😂😂 invest is a choice😂😂😂😂😂😂😂😂.
The issue is not invest the SA (before or after 2025) but getting 4.08% interest every year if SA still around. Mr Loo is diverting your attention from the main issue here which is the TERMINATION of the SA which is hurting many CPF members!
@@cw5705 terminate and move to RA until ERS to continue the 4%, right? You still get the 4%, just not the liquidity
Or am I missing something?
@@frjuy Precisely there is no more liquidity between 55 to 65 years old. Not sure you know if you top up full ERS 4x ... yah you get a higher payout BUT YOUR INTERESTS ACCRUED AFTER 65 IS NOT YOURS ANYMORE? PLUS YOU CANT SEE THE BALANCE UNTIL YOU DIE WHEN YOUR BENEFICIARIES GET BACK THE PRINCIPAL. DO SINGAPOREANS KNOW? ITS A SCAM MAN!
The Pap government is eerily silent on the SA matter. Just imagine the many things including possibly monies Pap took away from us without telling us!
Gov. found a loop hole called shielding. 😐
Those who didn't dare to shield but SA way about FRS, are also affected by this change.
very nice and clearly presented, thank you sir
Thanks to pple like u lah govt no choice
Thanks gurus teach for using SA to a rich, I can’t imagine future generations
Current RA scheme is you need the paid premium; more payout more premium need to be deducted from your RA is good for insurance company not like the previous scheme no premium.
Tks PAP,u are the best 👍👍👍
take out all the excess and buy into S&P500
Yeah .me too
Dangerous
Correcting a wrong is not the right way to put it
Those who have good balances in the SA and could have earned 4.08% must ask themselves this important question. With the SA removed, would you be getting more rebates, CDC vouchers, whatever gimmicks they give ... than the interest you would have if the SA was left intact? The likely answer is NO!
Kung sporean ka. Mag accumulate ka ng stocks na may dividend while waiting to appreciate the value of your port you may beat OA 2.5% interest.
In essence, from 2025, SA shielding is dead, SA interest after 55 is reduced to 2.5% with option to withdraw (by transferring balances from SA to OA)
2.5% is dead end as cannot cope with inflation, so need to spend it or risk to lost it in stock market/property.
How does this affect your channel name? 1MNextLife instead?
Ha… very creative
I think I will remain angry and vote opposition.
The SA account was a favorite for rich CPF people because of its high interest of 4%. Now they have to decide which financial instruments in the public space to invest which can fetch 4%. Sg Treasury bills fetch 3.3%. Bond interest maybe lower. On riskier instruments is stock. So these decisions may not sit comfortably with some people because they need to choose. They may lose money like earning less interest if they buy treasury bills. Some chose to buy stocks but they lost 33% of the money after buying Alibaba stock a year ago. So no good options left for risk averse people.
Not true. That’s what they want u to believe. Wealthy ones hv instruments which easily get over 5-10%. One example is US T-bills, more than 5%
Why can't we put it into OA. We can withdraw and if we want to put in, we can
If your MA is sufficient, the money will go to OA.
Still able to maintain BRS in RA after pledge yr house? No changes to tat?
I wonder how many of those who kpkb blame gahmen are really over 55 and are withdrawing regular spending money from their SA now?
did 1m65 popularity open a can of worms with the garment?
New ERS is 426k, not 411k
426K is 2025 ERS. This closure of SA starts 2025.
Hmmm just curious, how many really take out their sa frequently? It is not easy to know how much to put into ra as our life span is different from ppl to ppl. Hindsight is that ppl who most money in ra will have less likely to be scammed
1M65 becomes 1M70
Long story short, he booboo again. 1M65 kena snooked. Personally, I suspected something like this is going to happen, cos its just 'too good to last'.
Precisely, it's always better to depend on yourself than to blindly believe that policy will always remain the same.
The biggest flaw behind this 1M65 movement is to naively assume it is risk free
1todiechasingtheM
Are we sure pap will allow us to withdraw OA anytime? If damn scary to have pap ruling us in the past 50yrs like they stopped full withdrawal at 55, moving target for the limit and now this move to close the SA...
So many people i know at 55 OA can take out what's beyond the minimum. Assuming they were mid-high income earner.
Stop this no evidence based fear mongering.
@azureliteyahoo of cos we can, I am saying are they not allowing anytime as they want??
@@NEAAFFAIRS fear not.. trust the pap
i tot at 55 OA is lock, now they change any reminding goes to OA, meaning to say country is in trouble need $$, they are trying to increase the price of properties. because OA can use for buy house.i a little bit confuse, correct me if i wrong
It basically means, half a million with 1.5% compound interest is gone from 55 onwards, losing a million if i could live up to 100 years old.
when the money inside cpf it is the garment money they may do what they want
With this new deletion of SA..can we still pledge half the FRS to make it to BRS..?the excess go to OA then right ? pls clarify? Because there are people who still works after 55 and their mthly cpf contribution be distributed to OA ,SA and medisave previously?
So it only affects ppl whose SA is above the FRS.. it's nice to see rich ppl whining..
Following the commercial banks😢
Joker most are average workers who have that sum in SA after purchase of flats unless you are top management , directors
I wouldn’t have minded it so much if the govt had allowed those who have already reached 55 yrs old to maintain their SA accounts instead of pulling the rug out from under them.
Yes. Instead of forcing them to invest elsewhere with higher risks, it is better to encourage them to keep in CPF. What is 4% interest compare to the return GIC get from their larger funds investment. Should help the ordinary citizens to grow together.
This will also reduce govt burden if one do not invest wisely outside of CPF.
Agree ti's is basically leaving these folks in the lurch, after they worked hard to save up the money for the bit of extra interest. So much for 'leaving no one behind" but if u dare get a lil ahead...!
It is easy, I did my shielding of SA, with this changes , I will take all my shield SA and put to DBS post dividend and bonus issue shares as price will drop and I will still get 6% dividend yield. Quite simple actually
Don't assume DBS will always stay at this price, it has dropped below $10 in 2009. The dividend yield will not make up for the drop in price. At current price of $30+, it is already almost at all time high. With upcoming expected drop in interest rate, we all know price will eventually drop
@@pathfinder1672 you should never buy only I can buy DBS as I have been doing so for the last 10 years . I prefer only I benefit from this and not everyone else
@@pathfinder1672 Yes agree. All the super rich in the world have already gathered here. There is not going to be another tsunami of richie riches coming again. This is the super peak already. Thats why DBS CEO dropped his shares.
Can’t wait to make so much more 💰from DBS since the day I bought at 15 and kept adding up till now
@@kevinho4504 You should sell now. There is no more headroom for increase.
Mr Loo. I need some clarification. Interest earned under RA cannot be withdrawn, no? so after 55 when the FRS goes into the RA and not SA, that 4.08% you can take meh?
Those people complain are definitely CPF rich
well there is nothing wrong with that i guess
Nope there's oso those struggling to see where they can park a lil of their hard earned savings to meet the shifting, growing FRS!
The goalpost has been shifted, once again. How many times hv the rules been changed when its members followed thru n starts to reap benefits from rules set by cpf. This “follow thru” period is also a form of sacrifice. However, this change has the potential to increase money supply to further inflate prices(in yr expense).
mr loo, can explain how you get 6.29% and 6.68% respectively?
after the 10 years of 4.08% annual interest compounded , $426,000 become $635,444 approximately, so $3330 x 12 divided by $635,444 x100 = 6.288% round up to 6.29%
Actually one positive change they should have allowed as a matter of principal is for SA limit to be the ERS limit.
I think what u mean is allow those under 55 to continue to top up SA to ERS via OA transfer or cash (with tax relief)
@@NinJa-qr1sp yes u are right. Since they ERS is rdy set. Why not let ppl top up. Then at age 55 only the ERS amount is left. Balance can transfer to OA. Like that would fulfill the principle of holding money long term for long term gains
Hi @1M65 , if after 55 yrs old, i have left only $205,800 in my frs, my OA left $0, 1st jan of each yr, will some frs interest $ will go to my OAaccount?
Cpf was never intended to give risk free returns to the rich. This is the right move.
Rich don’t keep money in CPF. They have the financial know-how to invest. It’s those middle classes that wanted to retire.
I bet u dun have cpf money one
@carnesir - you may not have realised that you TOO (like all other poor/medium class/rich persons in SG) have a CPF SA account that was supposed to have extended beyond 55 yo.
If this was truly a move meant to be equitable, the govt would restrict the max balance of CPF SA post 55 instead of abolishing it totally.
Remove your blinkers
So what is the intention of cpf? To make who rich or poor?
@@ocswoodlands agreed. Gov should keep SA with a cap not higher than ERS (RA+SA). And allow those above 55 to work and continue to contribute to their SA.
For generations, people are enjoying this. Now gone, from my generation onwards.
1mil buys 33000 DBS shares with yield of 5.30% with divd of 50k per annum. Fit and forget.
Bro s&p500 8-10% yr on yr. U still looking at 5.3%??
@@Longtermalwayswins USD exposure is bummer
@@Longtermalwayswins - S&P 500's withholding tax is 30% so retirees getting their dividend in SG is dividend amount - 30% = $$ get in hand.
What’s the Dividend Withholding Tax that everyone seems to talk about?
Singapore investors are subjected to a 30% U.S. dividend withholding tax on all dividends received from U.S. listed equities (i.e. stocks, ETFs, bonds, mutual funds, etc) because Singapore doesn’t currently have a tax treaty with the U.S.
This means for every $100 dividend you get from stocks or investments in the US markets, only $70 reaches you.
@@leenathayil2039 DBS is my divd ATM for several years.Ofcouse cost basis/average price is a big factor.
Don't complain, think who U voted, now U know they give U chicken wing, and time to get back the whole chicken. that's 1.5% of interest missing, go calculate how much U can get.
It’s only 4% come on. I doubt that’s enough to beat inflation anyway. You could be consistently losing wealth in real terms by “saving” there.
Sir you sound like you are making good money elsewhere. Btw when was the last time you bought $100 per pax buffet for your many friends?
Mr Loo,
I am 67, now receiving the payout, can I use my OA to top up my SA and receive higher payout per month?
好花不常开，好景不常在。
Here not ktv leh 😂
Congratulations Singaporeans, keep bringing them to power to suka suka change policies