The Magic Rate to use your CPF OA for Singapore T bills even if the Rates are Falling
By Investmoolah  •  December 3, 2022
As many people will know, T bills interest is falling due to its attractive returns and its bidding mechanism. People will say that below 4% is not good, but in fact it is still good. As long as T bills offer 3.4% and above, it is better than CPF OA rates. Therefore, Singaporeans should put the maximum sum of their CPF OA avalaible into T bills because of its higher interest than OA and are backed by the same entity - the Singapore Government (CPF OA is only 2.5%). Readers may point out that the first 20k of CPF OA earns 3.5% but this point is moot because the first 20k of your CPF OA cannot be used for T bills (so this point is covered). Cut Off Point of T bills being Attractive The magic number is 3.4%. This is because of the mechanism where CPF does not give you interest for the month you withdraw the...
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By Investmoolah
A total otaku who loves anime, investing and the occasional K-drama. My financial journey begun at the age of 22 and has revolved around the concepts of "Working Hard", "Saving Well" and "Investing Wisely". Through my journey, I have realized that financial literacy is something we have learnt little during our school days but is one of the most useful and relevant skill that we have to be equipped to take on the real world. Concepts such as compounding and "common sense investing" are skills that will place us ahead of the race to retirement ...

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