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CPF interest earned in 2019. (Make money while you sleep.)

Friday, January 3, 2020

There are people who think that CPF is not real money.

Therefore, the interest earned by CPF savings is just a lot of smoke.

Well, I think the people saying that are the ones who are producing lots of smoke.

Cough, cough.

Don't stand too close to these people.

Breathing in second hand smoke is more hazardous to our health than smoking ourselves.

If these people stop being emotional and think rationally instead, they will stop misleading themselves.

What is worse than being misled by others?

Yes, it is misleading ourselves.

If our CPF savings is not real money, would we be able to use the money to pay for H&S insurance?

Are insurance companies stupid?

If our CPF savings is not real money, would we be able to use the money to pay for our homes.

Are property developers stupid?

Now, interest income is not only income, it is passive income!

Passive income is money we make even while we are sleeping!

How to have a meaningful amount of passive income with a high level of certainty from a risk free and volatility free instrument?

Read this recent blog:

CPF can be our best friend.

Nurture or reject friendship with CPF?

Unless we are very rich, the wise choice is to nurture and not to reject.

The very rich have options which we average people don't.

To me, the CPF is a low hanging fruit.

Why do I love to pluck low hanging fruits?

They require very little effort to pluck, of course.

Perfect for a lazy person like me.

Bad AK! Bad AK!

So, how much low hanging fruit did AK harvest in 2019?

OA interest:


SA interest:


MA interest:


Total interest earned by my CPF savings in 2019:


Unless we have lots of money sloshing around and have already maxed out our CPF membership, we should focus on building our CPF savings as it should form the bond component of our investment portfolio.

For most ordinary Singaporeans, if we want to hold some bonds to prepare for retirement, maxing out our CPF membership benefits is all we need to do.


If AK can do it, so can you!

Yes, all of us can make money even while we sleep!

Let our sleep be rewarding in more ways than one!

Hug our CPF savings tight and don't let the bed bugs bite!

You might also be interested in this blog:
An unbeatable level of certainty in wealth building.

Recently published:
Made $1.5 million investing for income.


Siew Mun said...

For me turning 55 this year, CPF interests is real money. My CPF interest is $25,644.25. If I could follow you do it, others can do it too.

AK71 said...

Hi Siew Mun.

Gong xi gong xi! :D

Quoting Charlie Munger:

"Spend less than you make; always be saving something. Put it into a tax-deferred account. Over time, it will begin to amount to something. This is such a no-brainer."

It just takes some common sense and a dash of discipline.

You are a great example! :D

Chenheyuan87 said...

Hi AK, thanks for sharing. Do you think it is better to first build up our cpf SA to e min sum before investing in stock market?

AK71 said...

Hi Chenheyuan87,

For people who are very risk averse, that would be very appealing since the CPF is risk free and volatility free.

We have to bear in mind the opportunity cost of such a strategy especially for younger people who probably have a greater capacity for risk taking (but that is not to say they should have a greater willingness to take risk).

For me, I did OA to SA transfers in the first 4 years of my working life.

How to upsize $100K to $225K?

As for having FRS in the CPF-SA early, you might be interested in this blog:

FRS in CPF-SA at age 30?

AK71 said...

Here is another blog:

Hit FRS in CPF-SA by age 32!

JJ said...


I'm considering doing VC to my CPF as I am not working. Is there a monthly limit for VC? Or just the annual limit of $37740.

Also, I am wondering why you do not transfer all the funds in your OA to your SA, since this savings is for the long term anyways? Is there a limit to the amount in SA?

Thank you!

AK71 said...

Hi JJ,

There is no monthly limit for voluntary contributions to CPF, only annual limit.

As for transferring all my OA funds to my SA, I did that for the first 4 years of my working life which upsized my SA, giving it a bigger base to grow faster with the magic of compound interest.

I didn't continue to do so because I thought I might need my CPF savings to purchase a home of my own which I eventually did a few years later when the property market plunged during the SARS event.

I would not have been able to make the purchase without the help of my CPF savings then.

This is why I always caution people considering OA to SA funds transfer to consider their own circumstances and future plans because it is a one way street.

You might be interested in these blogs:

1. 4 ways to beef up our CPF savings.

2. CPF-SA is not a free lunch but it is not a myth.

3. Why do I choose to stay in a condo? (Why did I buy a condo?)

4. How did AK amass so much money in his OA?

JJ said...

Thank you AK, for your reply:)

I am currently age 49, not working, own a fully paid hdb, with over 200k in cash and stocks.
I have transferred all money from my OA to my SA, now around 100k. I am considering to do either RSTU to my SA or VC to all accounts and then transfer the OA sum to SA, to hit a sum of around 150K in SA by next year, in order to achieve a sum of around 190k when I hit age 55.

Based on current CPF rules, at age 55, will I be able to withdraw the amount above BRS (I estimate at 105.5k) from my SA? Thus I can consider this top-up amount as a worry free 6 year time deposit at 4% interest?
Another Q, in order to achieve this, my cash top-up needs to be via VC and not RTSU, right? (I read on CPF website that RSTU monies cannot be withdrawn in cash.
I am a little confused from all that I have been reading, thank you in advance for your next reply:)

AK71 said...

Hi JJ,

Sounds like a plan to me and I will probably be blogging about something similar later this month.

In the meantime, you might want to read this blog:

8 years AAA bond with 2.5% and 4% coupons.

All I am doing is voluntary contribution to OA, SA and MA.

No top ups. ;)

Related post:
How to grow our CPF savings?

Investminds said...

Hi Ak, another inspiring CPF interest post. thank you for your sharing.

Thanks to your blog, i followed your strategy and happy to receive total interest of $17k. Hope to reach your milestone one day.

I have a query on hacking the CPF. I read a ST article that before a person reach 55(bday), we can leave a small SA amount of $40K and transfer a large amount of SA funds (eg $230K) out to FSM platform to buy bond/equities. When 55, the gov will take the OA amount(eg $130K) plus the SA (40K) amount to form the RA (eg $170K). We can then sell the bond/equities and let the money flow back to SA ($230K) to earn a higher interest. This is a very good CPF hacking strategy.

Q1. May i ask the Gov will wipe out the entire SA amount first and then OA funds? Is that the reason why the ST article writer transferred out her SA funds and leave a small SA sum of $40k.

Q2. Is there any other good strategy or CPF hacking methods to share?

AK71 said...

Hi Investminds,

I am glad you have found my CPF experience inspiring and my blog helpful. :)

As for the newspaper article you mentioned, I shared the same article in a recent blog.

Withdrawing CPF savings: How much and how?

Q1. Yes, that is correct.

Q2. All that I know, I have shared in my blog. Shh. ;p

WTK said...

Hi AK,

I received a total interest of about $17K last year. I received the interest of about $15K. This goes to show that the compounding effect is also taking place in CPF accounts.


Potatoish said...

Happy New Year AK!!

wow its been quite a long while since i had time to read through and catch up. Glad to see your CPF is earning you good Interest. I just added extra $7k into my CPF-SA for tax. I think for a person like myself still servicing a HDB loan. its important to have approx 2years worth of HDB loan in the CPF for rainy days( i kiasu i know) I mention this because i was seeing on a popular forum youngster completely transfering OA-> SA which meant OA=$0

One needs to think long term and not take things to the extreme. just my 2cents


AK71 said...

Hi Ben,

Compound interest is a friend of the prudent and a foe of the foolish.

AK can be so poetic sometimes. ;p

WTK said...

Hi Potatoish,

I believe that the said youngster will have considered all factors before transfering all monies from OA to SA. It is not extreme decision as per my perspective.


AK71 said...

Hi JQ,

Long time no see. :D

You are being prudent with OA to SA transfer.

I am inclined to believe that you are doing the right thing.

In fact, I blogged about this before too.

See this blog from September 2017:

Reduce home loan with CPF-OA or do OA to SA transfer?

Having a contingency plan is always a good thing. :)

AK71 said...

Hi Ben,

We can only hope that the youngster JQ is referring to has thought of the consequences before leaping.

Too many people do not look before they leap. ;)

sginvestor said...

interesting that AK mentioned he bought a property during the SARS crisis.

hopefully, we are more prepared this time round for Pneumonia outbreak from Wuhan

Investminds said...

thanks AK for sharing. :)

wwwMisterBooncom said...

Hahaha AK71..

Thanks for the cpf video!

Boon... wake up! (haha same name) lol... ;)

AK71 said...

Hi sginvestor,

We can never be too sure of anything.

We cannot predict but we can certainly prepare. ;)

I blog about real estate matters from time to time too.

For my investment philosophy and why I bought my first condo during SARS, see:

Investment philosophy and real estate.

AK71 said...

Hi Investminds,

What did I share? ;p

Just talking to myself, as usual. ;)

AK71 said...

Hi Boon,


You are a TV star now! ;p

singaporean learning to retire well said...

that 25K per year interest alone can cover some people's expenses.
imagine having a passive income machine that is like a 2nd person working for you without the need to move a finger literally!
Thank you for sharing, i cannot thank you more for showing us that it is within the means of ordinary folks to develop a passive income stream

AK71 said...


If talking to myself in ASSI has helped some people, I am glad. :)

Newer readers might want to read this blog:
Power to become financially stronger is within us!

"I realised that many Singaporeans might not have the funds to invest with even if they want to.

"This is a reason why I decided to blog about the CPF as much as I had in recent years, sharing my own story.

"Making full use of the CPF will give us a measure of financial security in our golden years."

Your Ka-ki! said...


Centurion is 46c already. Huat ah

AK71 said...


46c is still cheap. ;p

Centurion Corporation is still cheap...

ong said...

Hi AK,
I start transfering my oa to sa after reading your blog about cpf few years back. and i hit the FRS last year to my big surprise.if u still remember, i ask u before at facebook regarding whether to use my spare cash to buy a 3year endowment plan as i am not a big risk taker. since i cannot transfer OA to SA anymore, i started transfering part of my OA to my mother RA to earn 6%. she finally get her 1st monthly payout. in future, if dont need the $, i will also continue to cash in back to mother RA to get the high interest. and at the same time can save on my tax . really thank for your advice that i did not take up the plan. else i will stuck 3 year with only half the interest. then i realized that i am actually "drawing out $" from CPF even before reaching age 55! this prove that cpf is a good system. just that we need to know how to make full use of it.

AK71 said...

Hi Ong,

Gong xi gong xi! :D

Thank you for the update.

Yes, I remember and I am providing the link to the blog for readers who might be interested to find out more.

How younger CPF members can get 6% interest a year?

Kingsley said...

Hi AK, I'm a little confused on the interest earned by the SA account you shared. I do rough calculation for FHR 181,000 sgd, the interest earned is about 7,000+. Based on the 4% and 5% interest, your SA would be above FHR? Either I did the math wrongly, or there's something I can do more. I just hit FHR so looking to see what to do next with the cpf. Thanks!

AK71 said...

Hi Kingsley,

I think you mean FRS. ;)

Yes, my SA is above the FRS.

Scroll up and see my reply to JJ.

Go to blog #2 I referred to in that reply.

Mystery solved. ;p

AK71 said...

Hi Kingsley,

I scrolled up and saw that there were two replies I made to JJ.

To avoid confusion, I have re-hyperlinked the relevant blog.

Read this blog to solve the mystery:
CPF-SA is not a free lunch but it is not a myth.

Kingsley said...

Hi AK,

Wah many thanks for directing and demystifying. Yes FRS, not FHR, don't even know what FHR would be in this context! #sotong

AK71 said...

Hi Kingsley,

FHR must be strong in your subconscious mind. ;)

Not too caught up in the property market, I hope. ;p

Fixed rates, SIBOR, FHR18 or HDB Housing Loan?

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