Most probably they calculated based on daily rest. Most financial institution do that nowadays.

So if your tax rate is at say 19% and you saved RM 3,000.00, your net ROI is 19+3.5% = 22.5%.

If you think that is not good, pls shoot yourself with a 0.50 Baretta.

Xuzen

Withdrawal form obtainable from Maybank branch. The processing is still done by PTPTN HQ.

Xuzen

For me it is a ROI of 30.25% for Y2012.

Xuzen

LOL, yes of course.

I kena tax'ed at the highest tax bracket... so it is beneficial to me to "plan" my tax.

Xuzen

First I use Excel to do the calculation.

I pull it for 17 years.

Under column 1: I put in a figure of RM 4,400.00 i.e., RM 6,000.00 less 26%. This means your actual capital is RM 6000.00 - less 26% = RM 4,400.00

Under column 2: I put in a figure of RM 6,000.00 because this is the actual amount put into SSPN every year for the next 17 years consistently.

Under column 3: I key in the formula =Column 2 x 1.04 because I assume SSPN will give a dividend of 4% consistently throughout the whole 17 year tenure.

I repeat the process until I get 17 rows i.e., 17 payment periods.

What I get essentially is:

i) PV = 0 since I start accumulating from zero value

ii) FV = RM 147,872.48 i.e., the total accumulated future value inc dividend reinvested.

iii) N = 17 i.e., 17 years tenure.

iv) PMT = RM 4,440.00 i.e. the actual capital outlay per period of time

v) Mode = End, since the dividend is paid at the end of the period.

From all the 5 parameters above I am able to calculate I, i.e. the Internal Rate of return for this series of investment using a financial calculator.

And from my calculator, the IRR (I) = 7.85% p.a.

Taking into a/c the tax savings, this SSPN saving vehicle is able to give a return of 7.85%p.a.

Can you compare SSPN rtn with an equity unit trust rtn in a direct way? The answer is no.

Because another component we have to take into a/c is Risk adjusted return.

For SSPN, I'll say its volatility or standard deviation from mean (the measurable parameter for riskiness) is very similar to money market fund i.e., around 0.1%

For an efficient unit trust, the usual standard deviation from mean is around 8% and a typical long term rtn is around 10% p.a.

So, let's compare the risk adjusted return of SSPN vs a efficient equity unit trust.

SSPN = (7.85 - risk free rate)/standard deviation = (7.85 - 3.1)/0.1 = 47.5 where the risk free rate I take is the current retail 12Mth FD rate

Unit Trust = (10 - 3.1)/8 = 0.8625

So if that is the case, does that mean we should dump everything into SSPN?

The answer is no, because SSPN tax benefit stops at RM 6,000.00 p.a. So it is not enough to accumulate for a child education.

However, SSPN plays a volatility reducing role in your overall portfolio for your child education.

Xuzen

I am not clever with excel formula.

Sorry.

Xuzen

Just checked at i-SSPN website and NOPE... belum dapat.

Looking at 2013, the dividend was credited into the statement somewhere between late Mar to early April, usually 6 weeks after EPF's.

BTW, SSPN's dividend declaration do not have the same fan-fare as its more famous counterpart (EPF). It is usually a very low-key affair.

Xuzen

This post has been edited by xuzen: Mar 6 2014, 08:05 PM

I also have just checked the e-sspn website and I concur that the 2013 dividend has been credited into my account.

Xuzen

1) Let's say I deposit RM 5,755.00 on 1/1/2014.

2) 2014 Dividend @ 4.25% p.a.= RM 5,755.00 x 1.0425 = RM 6,000.00

3) My tax relief is RM 5,775.00 or RM 6,000.00 for YA2014?

Thank you for you attention.

Xuzen

Assume deposited RM 140,000 get RM 6,000.00 dividend on top of that get RM1,560.00 tax relief, total = RM 7560.00 = 5.4%.

OK lar... so so nia.

Just like FD.

Xuzen

I call up the SSPN hotline and asked them whether can set up a standing instruction using credit-card facilities or not.

She answered as of this moment they do not have S.I. facilities.

However, to my mind, this S.I. thingy is just a matter of time.

Xuzen

For those at high income tax bracket of 24%; RM 6,000.00 x 24% = RM 1,440.00 tax savings.

SSPN gave out 4.5% dividend: RM 6,000.00 x 4.5% = RM 270.00

RM 6,000 - 1,440.00 = RM 4,560.00 actual capital invested. Future value is RM 6,000 + 270 = 6,270.00

Hence profit per annum = (6270 -4560) / 4560 x 100 = 37.5% gain. Apa lagi lu mau?

Xuzen

Historically is somewhere mid to end of April every year and the return is 4.25%. Nothing great. We are mainly using it for fhe tax relief.

Xuzen

Which part of this sentence do you not understand? Are you a Malaysian or a foreign citizen? To me that sentence is crystal clear!

Xuzen

This post has been edited by xuzen: Feb 28 2016, 09:59 AM

Our good friend WMK asked LHDN about this and LHDN says will follow whatever is printed on SSPN document

Xuzen

Unlike EPF which announce their dividend at press conference thereafter unwittingly invite loads of politician who will then politicize the whole issue; SSPN dividend is a very much subdue affair. They will quietly declare it in the month of Apr @ 4.25% thereabout. Check your statement on or after 30/4/2016, it will be there.

Xuzen

The main attractiveness of SSPN is the tax relief. The 4% is just the icing on the cake. So, for me, a 25bps drop is not an big issue.

Xuzen

I still have RM 1,500.00 quota left....sedang tunggu year end bonus.

I usually do online transfer.

Xuzen

Can. Have been doing that since my kid was one year old until now. But srly, I would prefer them to keep those freebies and pay me higher dividend. All these freebies end up as junk in my house.

Xuzen

This post has been edited by xuzen: Dec 21 2016, 07:09 PM

Maxed out my SSPN quota for 2016. Now I await my to do tax return in Apr 2017 in which to get my tax relief.