Eyes On Retirement

I topped up the full $7k into my SA today, before the end of Jan. CPF calculates interest on a monthly basis, so anytime before Jan 31 is fine. Haven't any other use for the money, so I'd park it here for 4% at the beginning of the year to maximize the interests. Do remember to do yours!

Effective Jan 1, 2019 the Basic Healthcare Sum (BHS) has increased from S$54,500 to S$57,200. Funds in the Medisave Account (MA) and Special Account (SA) earns 4% p.a, while funds in the Ordinary Account (OA) earns 2.5% p.a. Assuming you have hit the $54,500 limit in 2018, we can take the opportunity to top up $2700 to our Medisave Account by this month using cash to leverage on the following benefits: Tax deductions if you use cash to top up your MA. Note the $7000 annual cap on CPF deductions, so the SA top up in FY2019 will be $4300. When your MA has been maxed out, your monthly CPF contribution from your salary and employer will flow over to your SA. This account also earns you an interest of 5% p.a. Once your SA has met the met the Full Retirement Sum (FRS), the funds will flow over to your Ordinary Account, which earns you a 3.5% interest rate p.a. In summary, whenever the government increases the Basic Healthcare Sum, quickly max out your MA i...

Last month, I decided to top up my CPF Special Account since that account gives me 4% yield risk free. My calculations show that I can reduce my tax bill by $7k x 15% = $1050, without even taking into account future 4% yield benefits i'm to receive. It's definitely worth the top up from an ROI point of view, since it's tough to guarantee this kind of return in today's market. There is a maximum cap for cash top-up relief per Year of Assessment (YA) which is $14,000 (Self $7,000 and family members $7,000), but at least max it out for yourself if you have the spare cash. This way you can quickly hit the CPF SA ceiling sooner, maximizing the 4% risk free yield early on. Will do it again for FY2019.

I've never really believed in the whole new year resolutions concepts, and I'd rather view it as a time to set plans for the year. So here are my top 5 plans for the year. 1. Actively manage my family's retirement plans and portfolios. 2. Learn something from YouTube and apply it in real life. 3. Remain off alcohol for 365 days in 2019. I've been alcohol free since June 1 2018. 4. Dote on Mrs EOR more, because she's the most valuable person to me. 5. Spend more time with my parents. Happy new year everyone!