Ang bao money for kids: what to do with it in Singapore

Ang bao money for kids goes furthest in your child's Child Development Account (CDA). LifeSG says the Government matches every dollar you deposit, up to your child's cap. So $500 in becomes $1,000. Once the cap is used, keep the rest in your child's own bank account, and let your child spend and save a small share.

What to do with ang bao money, step by step

1. Count the ang bao with your child and note who gave what. A list on your phone with each name and amount is enough.
2. Check your child's remaining co-matching cap in Family View, linked from LifeSG's CDA page, where you log in with Singpass.
3. Deposit up to that amount into the CDA. MSF says you can use cash, a cheque, a standing order, or a transfer at an ATM or through internet banking.
4. Look for the match within 2 weeks. LifeSG says it's credited within 2 weeks of your deposit, public holidays excluded.
5. Use a cap above $5,000 by 30 September 2027. For children born before 1 April 2027, LifeSG keeps today's caps until then. Every cap becomes $5,000 from 1 October 2027.
6. Move e-hong baos into the CDA yourself. LifeSG says not to link your child's PayNow ID to any CDA, so a PayNow gift lands in their bank account first.
7. Keep money above the cap in your child's own bank account. For a child's PayNow, LifeSG names two types: a personal account in their name, or a joint account with a parent, such as the Child Savings Account.
8. Let your child keep a share to spend and save. MoneySense suggests a saving box, a spending box and a sharing box.
9. Born in 2014? Deposit before 15 December 2026. LifeSG says your child's CDA closes on 31 December 2026.

How the CDA match works for ang bao

The Government puts in a dollar for every dollar you save in the CDA, up to a cap. LifeSG's own example: deposit $10 and the Government adds $10.

The cap depends on your child's birth order and date of birth. On LifeSG's Baby Bonus CDA page, it's $4,000 for a first child, $7,000 for a second, $9,000 for a third and fourth, and $15,000 for a fifth and later child. Children born from 1 April 2027 get a $5,000 cap under the SG Child Support Package. The CDA calculator works out your child's total, and our CDA guide covers the First Step Grant and opening the account.

CDA money can't be withdrawn as cash. It pays for things like preschool fees and medical bills at Approved Institutions, such as childcare centres, kindergartens and healthcare providers. The CDA spending tracker shows what it covers.

A worked example with real caps

The ang bao amounts below are an example, and the caps are LifeSG's: $4,000 for a first child now, and $5,000 from 1 October 2027.

A second child shows why the date matters, because LifeSG's cap for a second child is $7,000. Say you've deposited $4,000 so far (an example) and want to use the rest. Until 30 September 2027 you have $7,000 - $4,000 = $3,000 of room. From 1 October 2027 the cap is $5,000, so the room is $5,000 - $4,000 = $1,000. Put the $3,000 in by 30 September 2027 and all of it is matched.

Ang bao money by age

MoneySense says a 2-year-old can learn to count and compare, and suggests a clear jar instead of a money box. That way the money doesn't seem to vanish. For an older child, it suggests saving for a few months towards a toy they want.

For a weekly allowance and how much to give, see pocket money for kids in Singapore.

When your child's cap is used up

MSF says there's no limit to how much you can save into the CDA. Money above the cap gets no match, and it still can't be withdrawn as cash. When the CDA closes, unused money moves to your child's Post-Secondary Education Account (PSEA), up to its cap. MSF says only the excess above the PSEA cap is refunded to your child.

So once the cap is full, the rest of the ang bao is easier to use from a bank account. LifeSG names the two types of account a child's PayNow can link to: a personal account in their name, or a joint account with a parent. The Child Savings Account is opened with the CDA, at the same time. MoneySense lists what to check before you open any account:

• The fees, the minimum balance, and the charge if it falls below
• Withdrawal limits at the branch or ATM
• Who can take money out. In a joint-alternate account each holder can act alone. In a joint-all account every holder must give the instruction.

For school costs further ahead, the guide to saving for your child's education covers the schemes that help with them.

Ang bao from grandparents, and e-hong baos

Grandparents can deposit straight into the CDA: MSF says anyone can save into one, and it all counts towards the match, up to your child's cap. Only the CDA trustee can authorise spending from it. LifeSG says the trustee is the parent who registered the birth or applied for Baby Bonus. When grandparents give a lot, see how to avoid spoiling your child.

MAS encourages Fit notes or e-hong baos for Lunar New Year. Fit notes are used notes, similar in quality to ATM notes, and may have fold lines or minor stains. An MAS survey found 2 in 3 people were open to receiving Fit notes in their hong baos. If you pre-book notes, MAS says to do it only through the bank's official website or app. Banks won't send SMS messages with clickable links.

An e-hong bao sent to your child's PayNow goes to the bank account linked to that PayNow ID. Transfer the CDA share across and the match follows. Setting up your child's PayNow helps beyond ang bao: LifeSG pays the $2,000 yearly Child Credits for children turning 1 to 16 there from April 2027, and asks you to set it up before 1 April 2027. Our Baby Bonus and Child Support Package guide has the rest of the package.

Giving ang bao yourself? Our Chinese New Year guide covers the customs. The same CDA steps work for duit raya, which our Hari Raya guide covers.

When to get help

• You're not sure how much cap is left: log in to Family View from LifeSG's CDA page with Singpass.
• You have questions on the SG Child Support Package or the cap change: call the Child Support Package hotline on 1800 111 2222, listed on LifeSG's package page.
• Your child's CDA closed before the cap was reached: MSF says you can keep saving and get the rest of the match in the PSEA before your child turns 18.
• A message asks you to click a link to book new notes: book only through your bank's official website or app, as MAS advises.
• Money is tight and the ang bao is needed for daily costs: call the ComCare Hotline on 1800 222 0000 for financial assistance, listed on MSF's site.

Frequently asked questions

What should I do with ang pow money for my baby?

Put it into your baby's CDA, up to the co-matching cap. LifeSG says the Government adds a dollar for every dollar you deposit, so $300 in becomes $600. The CDA then pays for preschool fees and medical bills at Approved Institutions as your baby grows.

Can I put ang bao money into the CDA?

Yes. MSF says you can deposit cash or a cheque, set up a standing order, or transfer at an ATM or through internet banking. Anyone can deposit, grandparents included, and the match is credited within 2 weeks, up to your child's cap.

How much ang bao should kids keep?

There's no official figure. MoneySense says a young child's saving goal should be reachable within a short time, so a small share they can see in a jar works well. Older children can save for a few months towards something they want. Deposit the rest into the CDA while there's cap left.

Can I send e-hongbao for kids to their CDA?

Not through PayNow. LifeSG says not to link your child's PayNow ID to any CDA, because the CDA is ring-fenced for approved expenses. Send the e-hong bao to your child's PayNow, then transfer the CDA share in yourself. MSF lists internet banking transfers as one way to save into the CDA, and all savings get the match up to the cap.

What happens to ang bao money in the CDA at age 12?

Under the Baby Bonus rule, the CDA closes on 31 December of the year your child turns 12, and unused money moves to the PSEA up to its cap. For children born on or after 1 January 2015, LifeSG says the CDA now stays open until the end of the year they turn 16. A child born in 2014 keeps the old date, 31 December 2026.