Do you know two ways to use CPF based on your belief in the system? While it is usually considered very good to take advantage of a scheme like this and use it to your benefit, there are certain things that you need to know about it before you use it. The first of these things will be how to properly use the scheme.
You must understand that the scheme works by paying you as per your income whether you have a job or not. There is no provision that says that you cannot get something as a reward for getting rid of your burden. Also, it is not provided that you should get something that will not only help you but can also be considered as a part of your family savings. The only purpose is to let you get some extra cash and hopefully help you make money as well.
If you do not make the best use of the scheme, it can create a lot of problems for you and your family. This is why you need to understand two ways to use CPF based on your belief in the system.
Identify how you want to use
The first thing that you need to do is to identify the right time to use the scheme. If you take the scheme while you are unemployed and thus do not have a regular source of income, it can be quite a struggle to make any money out of it. Even if you do have a regular source of income, chances are that the scheme may not be of much help. Therefore, you need to consider that at this point in time, you cannot really make any real money out of it.
Similarly, if you get a good job but you are unable to handle the regular sources of income, you can continue to use the scheme till you get another job that will enable you to earn a regular monthly amount. This is because you will have been able to do some extra work to develop your work skills which will enable you to take up another job soon.
Finally, the best time to use the scheme is when you have a good steady source of income. The fact that you are no longer dependent on the scheme to make ends meet will go a long way in helping you keep it well.
Income levels and Savings
Once you have decided on the right level of income to use, it is now time to decide on the amount that you want to save. If you need to keep a certain amount as a savings fund, you can leave this amount unchanged. You will have to decide on the different types of loans that can be used to fund your needs.
You can use a personal loan to pay off the bank installments or you can also use it to buy more of the scheme to use it on. This may sound a bit risky, but the truth is that you will only earn a lump sum if you do not use it. So it will be a much better option to use it to help you build up your savings.
Also, you should know that the interest rates on the personal loan are likely to be higher than the one charged by the bank. However, they can be used to pay off the various debts you have. On the other hand, the interest rates on the CPF scheme is likely to be much lower than the interest rate charged by the bank.
Interest rates to consider
If you want to borrow more of the CPF scheme, then you need to make sure that you are aware of the interest rates charged on the loans. There are certain schemes available where you can easily borrow a maximum of two hundred thousand rupees. You can, therefore, take advantage of these schemes by starting with the lowest and working up to the higher loan amount.
At the end of the day, this is all very important information to be aware of and follow. in order to maximize the benefits of the scheme.