However, money that is already invested will not be affected by the new rules.
Q Some of my investments were made using CPF monies before April 1. I have less than $20,000 in either my Ordinary Account (OA) or my Special Account (SA). Must I liquidate my CPF Investment Scheme-OA (CPFIS-OA) or CPFIS-SA investments?
A No, you are not required to liquidate them if you made them before April 1.
Q If I sell or switch between my investments after April 1, can I re-invest the sale proceeds if my OA or SA balance is below $20,000?
A Under CPFIS-OA rules, when you sell or switch investments, the proceeds are credited to your CPF Investment Account. You may re-invest them in your Investment Account, even if your OA balance is below $20,000.
The proceeds are automatically refunded to your OA if there are no active transactions in your Investment Account for two consecutive months.
Once the proceeds are refunded to your OA, the $20,000 restriction will apply. You may not re-invest the balance if your OA balance is below $20,000.
Under CPFIS-SA rules, when you sell or switch investments, the proceeds may be credited to your SA and you may not re-invest the balance if your SA balance is below $20,000.
Q If I have $X in my OA and $Y in my Investment Account, how much can I invest?
A Here are the possible scenarios.
(1) If $X is less than or equal to $20,000, you can invest only $Y.
(2) If $X is more than $20,000, you can invest $X minus $20,000 and $Y.
(3) If you initiate a refund of $Y to your OA or $Y is automatically refunded to your OA because you have no active transactions in your Investment Account for two consecutive months, the following will apply:
(a) If $X plus $Y is less than or equal to $20,000, you will not be able to invest any amount.
(b) if $X plus $Y is more than $20,000, you will be able to invest $X plus $Y minus $20,000.
Q Can I continue to service my insurance premiums if my OA and SA balances fall short of $20,000?
A You can continue to service your regular premium insurance policies, but not recurring single premium insurance policies or regular savings plans for unit trusts.
You can resume paying insurance premiums or servicing regular savings plans after you have built up savings in excess of $20,000 each in your OA and SA.
Source: CPF Board