Dear readers, a Happy Chinese New Year to All of you!
Every Chinese New Year, kids are always the happiest: the snacks consumed, the Hong Baos received, as well as a break away from school!
Talking about the Hong Bao monies kids have received, many parents will, after the Chinese New Year period, tally up the Hong Bao monies their kids have received and deposit them into the safety of the banks.
But what if your kids do not require these monies for the present to medium term and both parents and kids are able to hold the monies for a longer period? In this case, how best can parents make use of their kids’ Hong Bao monies?
Well, one way is to deposit the Hong Bao monies into the kids’ CPF Special Accounts. At about 4% annual interest rate, that initial deposit of Hong Bao monies will become a substantial amount, especially if parents were to compound this monies further (by continuing with the topping up of the Chinese HongBao monies every year).
By starting the CPF top-ups early for their kids, one can accumulate great wealth for their kids. In fact, 1M65/4M65 founder, Mr Loo Cheng Chuan has shown that by contributing $64,350 to a child’s special account at birth, this amount will grow into an astronomical $1 million when the child retires 65 years later! For more details, visit this website!
But a word of caution, parents who wish to explore the aforementioned method have to think twice. This is because monies that go into CFP accounts will not be liquidated or use unless certain conditions, in accordance with the use prescribed by the government.