The tax saving is attractive but return of 4% just normal. Compounded long term I lose out alot

OIC,no wonder i dont get dividend as i put in on dec 2016. Thanks a lot.

Ya,better take out and invest on others, only put back by year end.

Put back yr end can't get tax incentive wor how?

Diversification is key. It's better or matching FD rates. Unless you believe you should put all your eggs in the high risk high reward basket. Of course it's also stupid to put all your funds in SSPN, but this is only 6k a year.


Can, but the amount you put back must be 6k more than what the amount was on Jan 1st.

So if you do the following:-

Dec 31 2012 - Deposit 6k (qualify for tax deduction 2012)
Jan 1 2013 - withdraw 6k (takes a few weeks though)
Dec 31 2013 - Deposit 12k (qualify 6k for tax deduction 2013)
Jan 1 2014 - withdraw 12k
Dec 31 2014 - Deposit 18k ..... etc.

Then you get the tax rebate, and the only loss to you is the lost interest of a few weeks of processing for withdrawal.

Good strategy. So we have the 1 yr period to invest before put back. To withdraw from sspn we need go to the counter and fill in form or can do online request?

Jfi....the rm 6k tax relief/rebate is till tis yr only...nrxt yr go back to rm3k

True. Better dont spend precious time bank in & withdraw for 3k a year. Treat it as diversification lor. At least bila tua, got various sources of income or places to withdraw from, hehe.

3k per year will grow. When its only 3k easy to say 'don't spend the time', but if you do this every year, after 10 years you got 30k inside there you really want to leave?

If it's <10% of my savings then I won't bother, but for those where it's significant, better to take out.

Not like that bro... need to increase every year

Oh drop half? Then more reason to invest as the sum is not so substantial compare losing 6k of investment money.

as there is always another side of a coin.....so does any gain from investment or tax deduction will not be substantial too.

I check google and there is no mention about the 3k. It is still 6k.

Anyway I make comparison calculation if taken the 4% sspn dividend and reinvest the tax saving with 10% return it still lose significantly compare to investing the whole 6k at 10% return.

yes RM 6k till 2017...
http://www.hasilnet.org.my/income-tax/tax-relief/

btw, for my payscale...the tax saving from RM 6k is more than ....

This post has been edited by T231H: Feb 21 2017, 08:20 PM

If you're highest bracket (or close to) tax savings is by itself 20+% so definitely better than any 10% return. Unless you think you're going to leave the money in SSPN for 10 years.

At that point you need to understand about diversification. If I have guaranteed 10% per annum for 10 years of course I'll go for that. Good luck finding that instrument (even ASNB don't have that performance, and anything above that is very high risk/high reward).

Ya of course I mean long term. No point save in sspn for 1 ye right? And the next yr to be eligible need to increase another 6k will make it long term already. Also the point for sspn is save for children education which is also long term goal.

Based on my calculation it only take about 7-8% return to break even with the 4% sspn dividend + reinvest of the tax saving. Put in a good investment I think not difficult to average that 7-8%

What do u think?

SSPN can be one of your many investment baskets. Not all baskets have to be performing double digit returns. Some here and some there. Some can be converted to cash quickly and some more difficult and takes time to convert (eg property, etc). And thats diversification I guess.

Why is it your only option is:-
a) Put in SSPN and never take out (reinvest tax savings)
b) Don't do SSPN

Already we were discussing earlier a way to maintain liquidity while still increasing amount 6k per year which doesn't involve leaving your money inside SSPN. Even better if after 3 or 4 years you 'skip' one year (lose out on tax savings that year) to reset to 0 so you don't have to keep putting larger and larger amounts end of year.

What the 'point' of SSPN is, for me, is tax savings. Their stated purpose of children's education is besides the point for me, as long as they let me access my money when I want it. This is unlike, for example, KOPP with defined investment per year and no withdrawal till 18 (and also higher returns).

In the end, you need diversity. SSPN compares well with FDs which are instant availability of liquidity instruments with guaranteed returns, and with added tax break advantage. That's complementary and not replacing your other higher return/risk investments.

U r right. Just have to think of a strategy to play around it

Hi. Is the tax relief statement available now?
What's the link to access?

Otherwise, when it will be available based on past year?
Thank you.