More on: Child Development Account

Why do you need a CDA account?

A CDA account is a bank account that’s tied to your baby. This is where the government deposits a portion of the money due to you as part of the Baby Bonus.

You will need to open a CDA Account when your child is born in order to receive (2) and (3) of the following Baby Bonus components:

(1) Cash Gift – Either $8,000 (for 1st and 2nd child) or $10,000 (3rd child onwards) will be paid out upon the birth of your child. This is paid into any bank account you wish, and not your CDA.

(2) Baby Bonus First Step Grant – Another $3,000 will be deposited into the CDA for all kids born on 24 March 2016 and later.

(3) Dollar-for-dollar matching of savings – The government will match each dollar you save in your CDA account. This means that when you deposit your first $3,000 into your CDA, the government will deposit another $3,000 to match it.

The government will only cough up maximum $3,000 each for your 1st and 2nd child, $9,000 each for the 3rd and 4th child and $15,000 for 5th and subsequent children.

What can you use the money in your CDA account for?

The money in your child’s CDA can only be used for specific things. 

Once the cash goes in, it can only be used for educational and healthcare expenses for your child. CDA money cannot be withdrawn.

You can only unlock the funds on the following, and only at Baby Bonus approved institutions:

• Childcare and kindergarten fees

• Special education school fees and early intervention programme fees

• School fees and school programme fees

• Medical bills (including vaccinations)

• Optical expensesHealth supplementsInsurance (for Medisave-approved Integrated Shield Plans)

• All of the above needs for siblings

Go to the Baby Bonus Approved Institutions portal to find out where you can use this money.

How to open a CDA Account?

Refer to our previous post for more information!

References:

MoneySmart.Sg - Tips, tricks and uncommon wisdom to help you get more out of your money. 2020. CDA Account Singapore - How To Open CDA For Baby Bonus Payout. [online] Available at: <https://blog.moneysmart.sg/family/cda-account-baby-bonus/> [Accessed 11 March 2020].