tag:blogger.com,1999:blog-11702093.post8757581622241442684..comments2024-03-28T17:36:33.351+08:00Comments on Tan Kin Lian's Blog: Top up the minimum sum accountTan Kin Lianhttp://www.blogger.com/profile/00617069056914635271noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-11702093.post-50128617984734159942015-06-05T18:43:48.794+08:002015-06-05T18:43:48.794+08:00CPF interest rate maybe high relative to bank savi...CPF interest rate maybe high relative to bank saving interest rate but real(not nominal) cpf interest rate is still too low, or negative.<br />Recent committee to study CPF states long term inflation is 3%. then why cpf OA interest rate is 2.5%, lower that 3% inflation. <br />Morever, CPF accounts interest are computed monthly based on LOWEST amount/balance for any month and NOT based on average balance for any given month. This means CPF avoids paying at least 1 million sgd very month since the inflow is 2 bio and the outflow is about 1 bio.<br /><br />A3. Contributions and Withdrawals by Members (within period)<br />2010 2011 2012 2013 2014 Jan-Mar 2015<br />Total Contributions4 (S$m)<br />21,993 24,628 26,048 28,530 29,722 8,968<br />Net Withdrawals5 (See Section D for breakdown) (S$m) <br />9,617 10,437 11,727 14,863 17,298 4,580<br /><br />Example<br />You had 100K in your CPF OA on 1st Feb 2015, 1K was deducted at 10th Feb 2015 for housing loan,<br />1K was contributed on 18th Feb 2015, what would be the interest for Feb 2015?<br />Lowest amount in Feb 2015 was 99K,<br />so interest for Feb 2015 was 99,000 x 0.025/12 = 206.25 (not 208.33 as expected)<br />The difference maybe small, but do that for 60 years and it becomes sizeable over 60 years. Do that for 1.5 mio active members and it becomes hugh. Anonymousnoreply@blogger.com