Wednesday, Feb 25, 2015
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BUDGET 2015
'I can save more in CPF account'
Published on Feb 24, 2015 2:40 AM
Madam Tan Kar Tiau, 52
Assistant teacher, earning about $1,500 a month
How she benefits
From next year, her CPF contribution rate will rise by 2 percentage points. She will also get an additional 1 per cent interest on the first $30,000 of her CPF savings when she turns 55.
How other CPF members benefit
They will also see the CPF salary ceiling rise from $5,000 to $6,000.
THE changes in the Central Provident Fund (CPF) system announced in the Budget yesterday will help workers such as Madam Tan Kar Tiau.
Madam Tan, a 52-year-old assistant teacher at a pre-school, earns about $1,500 a month. Her husband, Mr Khoo Hock Guan, 57, is a food and beverage supervisor. Their son, Mr Terrence Khoo, 24, is a student at the National Institute of Education.
Under the changes to the CPF system, Madam Tan's CPF contribution rate will increase by 2 percentage points.
When she turns 55, the interest rate on the first $30,000 of her CPF balance will increase by 1 percentage point as well.
This means that she will be able to get higher returns out of her CPF account, resulting in larger CPF Life monthly payouts when she turns 65.
"This is good for us, as next time I can save more in my CPF (account)," she said.
She also said that if she does hit the Minimum Sum and can withdraw a portion of her savings, she would choose to benefit from the higher interest rate.
"I want to keep the money for future use, like when I am older and cannot work for long hours," said Madam Tan.
ISAAC NEO
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