19/06/2026
Most people only think about CPF when they're buying or selling a property.
But there's a lesser-known move worth understanding — the Voluntary Housing Refund (VHR).
Here's how it works
When you use CPF OA to buy a home, you're essentially "borrowing" from yourself. When you sell, you have to return the principal plus the 2.5% interest that would have compounded if the money stayed in your OA.
A VHR lets you return that money early — using cash — without waiting for a sale.Why would anyone do that?Once the money is back in your OA, it starts earning 2.5% guaranteed interest immediately. That's the same rate your "debt" to CPF was compounding at anyway. So you're neutralising a growing liability and converting it into a growing asset.
The retirement angle
Here's where it gets interesting. At 55, CPF OA funds become withdrawable. So if you time a VHR around that window, you're essentially building a guaranteed income engine.
$1M in OA at 2.5% = $25,000 a year = just over $2,000 a month — with the principal still intact.
That's not a pension. That's your own money, working for you.
The trade-off to be honest about
Money locked in OA before 55 isn't liquid. If you're younger and can consistently beat 2.5% returns elsewhere — equities, REITs, business — keeping cash outside CPF may make more sense.
The general logic: keep cash flexible before 55, consider VHR as you approach retirement when the guaranteed return becomes more valuable than the flexibility.
This isn't financial advice — everyone's property plans, cash flow, and timeline are different. But if you want to think through whether this makes sense for your situation, drop a comment below or DM me.
