Investment using CPF money

Yesterday, I saw this news on Channel News Asia.

DPM and Finance Minister Tharman Shanmugaratnam in a written reply to parliament stated that about 45 per cent of CPF members who used their Ordinary Account savings to make investments from 1 October 2010 to 30 September 2011 suffered losses.

Just imagine, between two persons who used their CPF ordinary accounts to invest during 2011, one person made loss. Investing on your own is tough and making losses is real possibility.

It will be wise not to touch CPF ordinary account balance for investment on your own. The interest rate on this balance earns 2.5 per cent interest per year. This is better than interest rates of most bank deposits.

Copyright © 2012, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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2 Responses to Investment using CPF money

  1. Li Jianwei says:

    I do understand your point of CPF interest rates running @ 2.5% p.a.
    However that is a benchmark to the interest rates that banks are offering
    Just wondering what if we use the CPF money to buy REIT stocks (dividends @ 90% of revenue)
    and with track records showing REITs running @ approximately 5-7% p.a. dividends payout ?

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