Giving your parents allowance the smart way

I believe most of you gives monthly allowance to your parent after you all start working. I do so myself too. I am currently giving my parent a monthly allowance in cash. Recently, I have found a smarter way to give my Mom monthly allowance.

My mom is currently 67 years old and already has her CPF Retirement Account setup. She can actually start her monthly payout under the retirement sum scheme already, but we are delaying it till she’s 70 to give more time for compounding to work its magic.

Recently, I have started to top up her account via CPF transfer. I am transferring my CPF OA money to my Mom's Retirement Account. Although doing CPF transfer top up does not attract any tax rebate, the money transferred will attract a much higher interest than having them sit in my CPF OA. Instead of the 2.5% I am getting, it will get 5% in my Mom's RA since she has less than $60k inside.

In a way, I am using my putting my mom’s future monthly allowance in her CPF account and let the government help me beef up that allowance for my Mom. One thing to note is that to use your CPF OA to top up for your parents CPF, you need to set aside the current BRS, with sufficient CPF property charge to make up the current FRS. The BRS can be set aside using your OA and SA savings, including net amounts withdrawn for investments (you can go here for more information)

So are you making full use of CPF to fund your allowance?

Happy Value Investing


  1. That's exactly what I'm gonna do next year onwards heh. Planning to give two streams of allowance to my folks - cash plus CPF-OA (to their RA).


  2. Yeah another way to unlock our CPF-OA early

    1. doesn't seem to be beneficial to yourself. more for your parents.

  3. If parents already FRS or ERS, still can transfer?

  4. can they withdraw the money anytime?

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