- j4: yield
- J4: lock down free cash against missteps or hackers
- limitation — very poor liquidity.
See also
Rule 1: every $1k I top up to wifeSA is locked up forever. I wrote this in 2022. See wife’s geen portion
Rule 2 (Self-transfer): in my own case, any time after 55, I can apply to withdraw any excess amount from RA as long as remaining RA balance exceeds the BRS watermark. So in 2021, any self-transfer from OA to SA is “unrestricted”… can take out after 55.
— tax benefit .. comes with a severe restriction — any targeted top-up amount can’t be withdrawn at any time, not even after 55 or 65.
* MA account can’t be withdrawn except medical
Rule: Suppose I want to top up 8k in 2024 to enjoy tax benefit:
wife’s 2023 (pervious year) income must be < 8k including dividend, interest etc
Rule: only applies to targeted cash top-up to SA or targeted top-up to MA, including to family member’s accounts.
.. Rule: OA -> SA is unrelated to “income” and ignored by IRAS.
Rule: only the first $8k is recognized by IRAS for each tax year.
VCon amount of 37k (unlike targeted top-up) is NOT tax-exempt even though part of this 37k goes into SA/MA. (As confirmed at cpf appointment), the amount can be used for housing or withdrawn after 55.
In essence — Tax ^ Liquidity are 2 sides of a coin:
- with tax benefit, you sacrifice liquidity .. Look at targeted top-up
- without tax benefit, you have some liquidity .. Look at VCon.