CPF & Medisave minimum sums
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Re assumption 2, there will be increments when changing jobs and promotions. Increments when changing jobs can be quite substantial depending on industry. Also $2k starting pay may be a bit conservative.
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$2k @39 yrs ago is not conservative if you are looking at someone who will turn 55 soon.
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Irrelevant:
Not everyone can earn $2k as starting pay. Depends on what line the person works as.I'm surprised by the emotions exhibited here, but then again maybe I shouldn't be.
Being curious, I decided to do a simulation with the following assumptions:
1. Started with $2,000 pay at age 24.
2. Annualised increment of 3% a year =>pay at just b4 55 yrs is around $4,850.
3. Annual bonus (whether AWS or VB) assumed to be zero.
4. CPF Special Account contribution rates based on current rates, i.e. 6% at <35, 7% <45, etc.
5. Interest rate on CPF SA assumed to be 4%
6. Interest on CPF balance is calculated on a 1 year lag basis, i.e. new contributions to CPF is assumed to earn interest only in the following year.
7. The data point that once Medisave ceiling is reached, the Medisave contribution will go to CPF SA is ignored.
Given the above conservative assumptions, at age 55, CPF SA balance will become ....ta dah..... approximately $150k.
CPF amount also need to deduct for paying of housing and insurance coverage.
Put in SA means money cannot touch anymore? Why not let people has a choice to use CPF or not anytime, instead of put a minimum sum? Wonder if someone's CPF amount almost reach the minimum sum when reaching 55, then minimum sum increased again every year? What happens? :faint: -
http://madstranger.blogspot.sg/2013/05/cpf-minimum-sum-for-jul-2013-and.html
Came across this blog...just to share. -
Nebbermind:
$2k @39 yrs ago is not conservative if you are looking at someone who will turn 55 soon.
If a person works from 24yrs old to 55, he would have worked for 39 years? D minus for your maths.
It all depends on the age group that you are describing. For a person who is almost 55 now, he would have bought his flat in the 80s at 100k or less? His CPF contribution would have started at 50% instead of 36% currently. It is more likely than not that he would also have started work at age 16 or so, which would have allowed the wonderful effects of compounding work for him. -
Oppsgal:
CPF amount also need to deduct for paying of housing and insurance coverage.
A D minus to you too!
Since you are referring to my scenario, the focus is the CPF SA and not the OA. Since when do you plan to use the SA to pay for housing and insurance? -
Oppsgal:
You obviously miss the point of CPF.
Put in SA means money cannot touch anymore? Why not let people has a choice to use CPF or not anytime, instead of put a minimum sum?Irrelevant:
I'm surprised by the emotions exhibited here, but then again maybe I shouldn't be.
Being curious, I decided to do a simulation with the following assumptions:
1. Started with $2,000 pay at age 24.
2. Annualised increment of 3% a year =>pay at just b4 55 yrs is around $4,850.
3. Annual bonus (whether AWS or VB) assumed to be zero.
4. CPF Special Account contribution rates based on current rates, i.e. 6% at <35, 7% <45, etc.
5. Interest rate on CPF SA assumed to be 4%
6. Interest on CPF balance is calculated on a 1 year lag basis, i.e. new contributions to CPF is assumed to earn interest only in the following year.
7. The data point that once Medisave ceiling is reached, the Medisave contribution will go to CPF SA is ignored.
Given the above conservative assumptions, at age 55, CPF SA balance will become ....ta dah..... approximately $150k. -
Irrelevant:
Typo lah...30 lah...if u want accuracy, then 31.Nebbermind:
$2k @39 yrs ago is not conservative if you are looking at someone who will turn 55 soon.
If a person works from 24yrs old to 55, he would have worked for 39 years? D minus for your maths.
It all depends on the age group that you are describing. For a person who is almost 55 now, he would have bought his flat in the 80s at 100k or less? His CPF contribution would have started at 50% instead of 36% currently. It is more likely than not that he would also have started work at age 16 or so, which would have allowed the wonderful effects of compounding work for him.
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Irrelevant:
If minimum sum increases abt $10k per year going by the trend in the past few years, then the min sum when this guy hits 55 years old will be more than $450k, definitely not the current $150k. You get the picture now?I'm surprised by the emotions exhibited here, but then again maybe I shouldn't be.
Being curious, I decided to do a simulation with the following assumptions:
1. Started with $2,000 pay at age 24.
2. Annualised increment of 3% a year =>pay at just b4 55 yrs is around $4,850.
3. Annual bonus (whether AWS or VB) assumed to be zero.
4. CPF Special Account contribution rates based on current rates, i.e. 6% at <35, 7% <45, etc.
5. Interest rate on CPF SA assumed to be 4%
6. Interest on CPF balance is calculated on a 1 year lag basis, i.e. new contributions to CPF is assumed to earn interest only in the following year.
7. The data point that once Medisave ceiling is reached, the Medisave contribution will go to CPF SA is ignored.
Given the above conservative assumptions, at age 55, CPF SA balance will become ....ta dah..... approximately $150k. -
Dora1:
why must they raise the min sum?
If minimum sum increases abt $10k per year going by the trend in the past few years, then the min sum when this guy hits 55 years old will be more than $450k, definitely not the current $150k. You get the picture now?Irrelevant:
I'm surprised by the emotions exhibited here, but then again maybe I shouldn't be.
Being curious, I decided to do a simulation with the following assumptions:
1. Started with $2,000 pay at age 24.
2. Annualised increment of 3% a year =>pay at just b4 55 yrs is around $4,850.
3. Annual bonus (whether AWS or VB) assumed to be zero.
4. CPF Special Account contribution rates based on current rates, i.e. 6% at <35, 7% <45, etc.
5. Interest rate on CPF SA assumed to be 4%
6. Interest on CPF balance is calculated on a 1 year lag basis, i.e. new contributions to CPF is assumed to earn interest only in the following year.
7. The data point that once Medisave ceiling is reached, the Medisave contribution will go to CPF SA is ignored.
Given the above conservative assumptions, at age 55, CPF SA balance will become ....ta dah..... approximately $150k.
how is that going to help the people?
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