Raising the Threshold for CPF Investment Scheme-Special Account Investment
From 1 July 2010, the first $40,000 of members’ Special Account balances will no longer be allowed to be used for investments. Given the higher risk-free interest rate on the Special Account, it is better to be more conservative than to subject these savings to the uncertainty of CPFIS returns.
There is no change to the requirement for members to set aside $20,000 in the Ordinary Account before they can invest their Ordinary Account monies.(Taken from the CPF Board's official website)
That is bad news for investors who can potentially generate a higher return on their funds sitting in their CPF SA. However, that group of investors belongs to the minority. For the majority, the interest for the CPF SA is already very decent if you take into account that the return is risk free.
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HI Kay,
ReplyDeleteThank you for the information. Can I know what will happen if I am currently RSP funds using my SA account and my SA is less than
$40K? Will i be able to continue the RSP?
Thank you
Regards
Phyllis
Hi Phyllis,
ReplyDeleteI can't find any information regarding this so you may have to confirm with your financial adviser. But for the previous restrictions made in April 08, the CPF board mentioned that RSP for unit trusts will have to be stopped if the balances fall short of the required amount. Going by this precedence, I think it will also be applicable to this latest restriction too.
Kay
Interesing topic
ReplyDelete