This exploration article might be applicable if you are a business owner, freelancer who could build up your net worth faster than a salaried employee.
One of my reader went through this thought exploration about the CPF and he selflessly shared it with me. I thought I will share it here as well.
The question here is how would your first $60,000 in your CPF grow to in 40 years time?
Your first $60,000 in your CPF is interesting as CPF gives you an extra 1% on top of the usual CPF interest on your Ordinary Account and Special Account.
The image above illustrates it better.
Normally, your Ordinary Account (OA) earns 2.5% interest (not permanent) and your Special Account (SA) earns 4% interest (also not permanent).
Before 55 years old, your first $60,000 earns 1% more, up to $20,000 from your OA. This means that if you have …