Should I Use CPF or Cash For My First Property Down payment? | Investors Ep 9 (Melvin Lim)

[@larrybirb]

Great video. Just some correction at 6:00. If I'm using cash instead of CPF for my monthly mortgage, I would transfer my monies in CPF OA to SA, which guarantees an annual interest of 4% instead of 2.5%, or specifically, 4+1% for the first 40k, and 4% for the amount beyond. Therefore, if I'm using CPF for my monthly mortgage, my return on non-CPF investments (with considerably higher risk) should preferably be higher than the 4-5% you are recommending before I consider it a viable option.

[@PropertyLimBrothers]

Hi Bernard, thank you for sharing another option with us. Will definitely benefit our viewers out there😁 There are many options available and will depends on each individual situation and disposable income. Hence for the option that we proposed, in the event should there be a need to utilise the CPF for the monthly instalment, you will still be able to use it as compared to transferring over to special account where it will be non-reversible. Thank you once again for the invaluable feedback😁

[@andrewheng8200]

In theory it's always easy to say and think of what you can do... Who would want to use cash when cash on hand is little and liquid... I can say above 90% sinkies would always think of using CPF and balance cash.. Unless those who can use cash are those 400, 000 sinkies reported who has 500k in their cpf meaning they are rich

[@mitreviper]

1st 20k OA is 3.5% and OA transfer to SA is 4% with first 40k is 5%, for those who have enough cash

[@jasonong7097]

It really depends on how deep your pockets are.

[@muhammadfairuzsamsi7209]

What if I just use cash for monthly instalment instead of cpf? This way my accrued interest to return to cpf if i were to sell off the property will be base on the initial downpayment+bsd.

[@PropertyLimBrothers]

Hi Fairuz, Yes that is definitely one possible option From a "numbers" POV, it would make sense to use cash instead of CPF and not have to repay the accrued interest upon the successful sale of your home. Another alternative option would be to use CPF to pay for the monthly instalment, while the Cash funds that is not used to pay for the house is used to generate an average of 2.5% interest/dividend in an alternative form of investments. Both are viable options and it depends on each individual's preferences Thanks for your comment and we love hearing back from you if you have any other further questions ! Cheers! 🙂 -Marc, PropertyLimBrothers Team

[@Nekomajin]

Permission to share, would be nicer if a tad simpler terms used for non finance chaps like us

[@PropertyLimBrothers]

Hi, thank you for your feedback 😊

[@umbrage85]

just thinking out loud, should employer contributions (17% * up to SGD 6,000) to the individual's CPF account be considered too instead of just $1,200?

[@LKJTeresa]

Eric total contribution to CPF is 37% (20%+17%) but only 23% is allocated to CPF OA. If u earn $6000 that would amount to about $1380. Sure u can use $1380 for your calculation. However note that as u age, lesser is allocated goes to OA. So .. you may want to think about that too.

[@zr60]

How come need pay back accrued interest? This is such a scam.

[@ravetech5199]

whats the point of earning the cpf interest when i cant withdraw the full amount anyway.

[@Emsyaz]

The point is for the government to use it 🤣

[@gparamaeswary7276]

Save for your retirement

[@koosmangat]

technically you can if you renounce your citizenship haha

[@keytiax1128]

can l put $1 in my cpf n take back in future in cash

[@christinaaugustine27]

If I have no CPF ( homemaker all my life ) but a $1million cash and at 60yrs old , what would be a better option.. to buy a 3rms private condo or a HDB maisonette and have some money left for retirement ? Thanks in advance!

[@Raymanwee1933]

Made it simple , if u have cash , use u cash