Regular readers know that AK transferred all his CPF-OA money into his CPF-SA in the first few years of his working life. That provided a bigger base and a longer time for compounding to work its magic. Of course, I have shared the numbers here in my blog too.
do you mean that letting HDB wipe out the OA money first? My flat will be ready in 2019. So in this 3 years, do you have any views on what should be done using the CPF OA money?eg. Transfer abit to SA account? I will take your comments as opinions. Do not WORRY!"
That was what I told a friend. He transferred a large portion of his OA money into his SA about 10 years ago before he bought his flat and now his SA has already hit the minimum sum. But this will work for someone with an emergency fund on hand that would also cover the mortgage payment initially as his OA builds up again after the flat purchase.
The chat gave my memory a jog. I cannot remember exactly how many years ago but it was probably more than 10 years ago when a friend discussed with me what to do with his CPF-OA money. He was still single then and not buying a flat yet.
"I should have transferred more money from OA to SA in the following years. Then, I would have received even more interest and hit the MS even earlier."
Of course, all our circumstances and motivations are different. We have to question if this route is something that is good for us too.
This would work for someone who is not thinking of buying a property soon or is able to buy a property without using money in his CPF-OA.
1. CPF-OA to CPF-SA transfer before buying flat?
...the interest I received in my CPF-SA has been higher than my mandatory contributions to it for many years by now...