(PART 1 OF 2)
My Answer with regards to your Question:
The use of Central Provident Fund (CPF) funds for housing transactions in Singapore is subject to specific rules and regulations. Based on the information you provided, here are some key considerations:
Transfer to Retirement Account (RA) at 55:
At the age of 55, your Ordinary Account (OA) savings in your CPF will be transferred to your Retirement Account (RA) to form your Retirement Sum.
Once the transfer is made, your OA will be depleted, and only the amount in your Special Account (SA) and your RA will be available for withdrawal or use.
Selling and Buying Property:
If you decide to sell your property at 60, the sales proceeds, including any accrued interest on the CPF used for the property, will typically be used to repay the CPF. The proceeds will first be used to repay any outstanding CPF principal and accrued interest.
Any remaining proceeds, after the CPF repayment, can be returned to you in cash or, if you have met the Basic Retirement Sum in your RA, a portion of the remaining proceeds can be used to meet your retirement needs.
If you're below 55 years old
Upon selling your property, you will need to refund to your Ordinary Account (OA):
the principal amount (P) you’ve withdrawn to pay for the property; and
the accrued interest (I)—this is the amount you would have earned if these savings were left in your OA.
The refunded monies will remain in your CPF account to ensure that you have enough savings for your future needs—whether it is to fund your next home or your retirement.
Do remember, you can always reuse your OA savings for the purchase of your next home!
If you're 55 years and above
Upon selling your property, you will need to refund to your CPF savings:
the principal amount (P) you’ve withdrawn to pay for the property;
the accrued interest (I); and
if you had pledged the property to make up your Full Retirement Sum (FRS), this amount will need to be refunded together with the P+I.
CPF savings are primarily meant for your retirement needs and any CPF funds utilised for purchasing a property will reduce the amount available for your retirement. Therefore, all or part of the refunded amount will be used to top up your Retirement Account (RA) to your FRS*. Any balance will be paid to you in cash. You can also inform cpf board if you wish to retain the balance housing refund in your CPF Account(s) instead.
You can then reuse the Ordinary Account savings to purchase your next property, subject to the applicable housing rules and limits.
*You may withdraw your RA monies above your BRS (excluding interest earned, government grants and any top-ups made under the Retirement Sum Topping-Up Scheme) for your personal needs if you own a property. Note that doing so will reduce your retirement income.
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