With wages failing to keep pace with the high standard of living, CPF deduction may be an unwelcome thing for many people.

Moreover, many may not be able to see their CPF if the withdrawal age gets older.

The minimum sum also gets higher each year and never seem to stop increasing.

many I know have six figure CPF sum in their account and zero savings in their bank account. The main question they always ask is “how do I get my CPF money out before I die?” Is it any use if Singaporeans have to beg and borrow now because of unemployment and every bi-yearly statement report they see a $100,000 sum in their untouchable CPF account?

Something is wrong here and maybe the state can really look at the whole CPF issue. It’s either for retirement or housing or investment and we cant really have the cake and eat it well and whole here.

i ate in chinatown japan and found prices so much lower than singapore restaurants. i also found their engineers (from china) with few years of experience paid $6000 a month.

so i am thinking things in singapore getting so expensive (in fact higher than Japan for most of the things) and the pay is so low compared to developed countries such as Japan, US and Europe, how come Singaporeans are not complaining or voting against? Only our ministers’ and GLC chiefs are paid multi-millions.

Jump in resales – it is because the new flats are almost $700k, people are compelled to buy resale because they cant afford. GCT promise of low cost public housing in the 80s is for bs too?

CPF – recent radio ad is saying, dont count on it for retirement. they are saying, you will never withdraw since you are going to be paying premium flats plus the minimum sum is forever going up.

NTUC is always saying citizens must go re-training and accept low pay. When it comes to Ministers’ and super scale civil servants, how come they are not saying so? You want to lead us, you must show us, not just saying low pay is for citizens but not for themselves. Full of BS, dont you think so?

It’s so simple folks; THEY are the FARMERS…
and WE, are being FARMED.

Soon, Singapore will become nothing more than a hotel for foreigners, as most locals will have flown the coop…

Someone once told me that the reason why salaries are higher in those countries is because of minimum wage legislation. The minimum wage has the effect of pushing up all other wages because employers have to pay higher wages to retain workers who may leave for min. wage jobs if the salary difference narrows or even becomes negative. This has a diminishing upwards rippling effect on the salary ladder.

The elite Govt will use our CPF as national reserves and also for the TH n GIC to invest, so don’t expect to withdraw our hard earned money for retirement as both already lost so much B$$$ in the investment. The govt will keep moving the goal post (CPF withdrawing age further) so that we will never hv the chance to touch our blood n sweat money till death.

One way to overcome the ‘moving goalpost’ phenomenon is to renounce citizenship and move elsewhere. S$200K can get you a nice landed property in Australia…

#6, Ganga,

Trouble is most S’poreans who post on TOC only like to complain anon.

They don’t like to do anything to remedy the situation, improve 6their lot.

I’m here in S’pore because I got gd life here. But I’ll be renouncing citizenship and moving elsewhere. once life here gets too expensive. Northern Thailand or Cameron Highlands or the High Country in Antipodes are attractive places.

The most important question you need to ask is how do you explain this to the layman?I believe wholeheartedly PAP’s main supporters are those who don’t read political blogs and also who don’t subscribe to the belief in alternative government. Only PAP can solve all their problems. We’re really in catch 22 for Singapore.

With Temesak Holdings and GIC losses a third or abt $100 billion inevstment of our national asset, do we think we can withdrew the CPF money!

CPF is a good scheme for Singaporean to save but is a double edge sword that made Singaporean uncompetitive as compare to foreigners as employer don’t have to pay 13% CPF.
Warning ” Dont Buy Expensive HDB now , those >$400 K” else you die.

Gilbert, your article in newspaper today and very encourging of money saving tips!

9) Trueblood Singaporean

Thanks for your support.

Don’t understand why still so many singaporeans still so believing into all those craps and lies from those miw when they actually siphoned off all our entire cpf savings, before we keep hearing our cpf been hijacked and now we begin to see the whole picture, question now is do we allow those miw to continue robbing us of our livelihood and pretend nothing happen?

aiyoyo

cpf $ stuck until 65yr, how?

commoners how to dong until 65yr?

alamak, now need to solve $ problem, but cpf cant take out to use,

what’s the logic? if now got problem to go forward, how to think of next time?

aiyoyo

If the people want to have the flexibility of managing their own retirement funds, then don’t complain that the government doesn’t plan for them.

Everyone be responsible for their own retirement. Not that it’s bad, but know what you are getting into.

responsibility? eh, how about those who lost other people’s money? if its really my own money, why cannot even touch? cannot touch how to own self manage?

how does 1 tell all the old folks who have their retirement money locked up longer about “managing your own (CPF) money?”….?

Gilbert! For your Info abt Singapore Employment situation!

27,000 PMETS are unemployed and e2i has only manage to place 2700 of them which is 10%.

Though 124,000 is under Spur program and they had match 19,000 low skilled workers!

So suceess rate for PMETS is not there as what you mentioned!

Sunday time also show Senoir Engineer earning $4000 now work as security for $5 per hr! Can beliene my eyes!

PMETS unemployed rate likely to go up next 2 Qtr but not worse than 1 Qtr and heard actual unemployment is about 7% as compare to US 10%

How is Australia Situation and help to write more articles in ST!

Trueblood Singaporean,

Australia is till the same – many people unemployed maybe around 7%.

However, they have unemployment benefit and that helps alot.

Emigrants bored the full brunt of the unemployment here with employers axxing many work permit holders.

This is so unlike in SIngapore whereby foreigners, being cheaper, will hold on to their jobs.

I will try my best to write more to ST but it is up to them to publish.

Thanks for your support.

Dear Gilbert,

Why Singaporean are easily depressed because they suffer in silent!
Take whatever come from Employer and Expensive Gov!

We Singaporean need a voice and you are our Voice! Let that Voice be louder till the next election!

7) A Tan on July 6th, 2009 10.51 am
“They don’t like to do anything to remedy the situation, improve 6their lot.”

Maybe ace like you could give us a few tips on some better ways other than calling it quit here in this country and beside the complaining; and resigned to the fate that some people deserve to ‘monopolise’ how things should be run here.

Gilbert Goh you sound ike you have a better alternative but I know you have non to offer. Many Singaporean thought the government is unfair to them but the real reason behind is damned if you do and damned if you don’t.

Imagine if you let retairees to control fully their CPF money upon 55 and you will in no time run into a situation where the top 30% withdraw everything and sold everything to uproot to a new place where they call home for the next 30 years. The bottom 30% will withdraw everything and spend it off in no time and for the next 30 years the government have to take care of this bottom 30%. Singapore economy cannot substain such a situation, the economy will collapse. Do you think the PAP government never think of this?

, why not you write them down and let us debate over it? How are you going to solve the problem if the top 30% rich retirees withdrawing everything and say good bye to Singapore and

[...] despite I’ve just started working for only 6 months. Kudos to singaporenewsalternative and theonlincitizens for sharing. Another post will be up based on my personal [...]

Gilbert Goh, I beileve neither you nor the PAP Scholars got solutions for our Economy and Unemployment Situation! Wait for Obama!

As the World Progress on Talents Based rather than Scholaristic Based, Singapore Economy will be down in the Drained. None of products of ours can sell like hot cake in the World Econonmy like Samsung, LG, Acer, ASUS, Hyundai!

Forget about CPF and Meritocracy! As our Population Aged for those born before 70s, our CPF won’t be able to take out by 20 yr time! Is the Top going to help this group of people or take their Top dollars and run off! Should the top account for their mistake or they are always right!

Gilbert I can believe you can write something constructive abt our Aging Population, Economy and Unemployment Situation!

i can’t believe our millions $ ministers are so heartless. Want to make us work for them with our life, u ccb!

Sigh, so whenever our govt needs $$, it starts with raising gst. Which leads to inflation. Followed by calculations that show that CPF isn’t enough for retirement. And finally increased minimum sum and extend withdrawal age. Brilliant!

The CPF minimum sum scheme requires us to set aside $120,000 (in 2003 dollars) in 2013 when we reach the withdrawal age of 55. We got to ask ourselves this question. How many have this amount to set aside at the age of 55. A vast majority of Singaporeans will kiss their CPF goodbye and will never ever see the money. So the term withdrawal age has become a misnomer.

Many will have to be content with getting a measly monthly payout of 200 to 300 bucks for the rest of your miserable life after 65 until you drop dead or your CPF retirement account balance runs out, whichever comes earlier.

There is no typo error when I wrote 65. It is 65. Not 55. There is a frozen period between 55 but at 65 before this generous 200-300 bucks comes to you. In this ten year gao, you are supposed not to eat, I think. Meanwhile in that tens years, if you don’t starve to death first, you could very well die of pek chek.

The first attempt to tinker with the retrirement age years back, changing it from 55 to 60, drew a public outcry and a backlash in the substantial vote swing in the general election result the following year.

So changing the retirement age was wiped out from the dictionary and replaced with a thingy called the minumum sum scheme, which is actually the same bloodsucking vampire albeit with a new revamped image makeover, something like the greatlooking bloodsucker in Twightlight who actually does thesame thing as Dracula, suck your blood away.

It is a very very sneaky way to get around delaying paying our CPF back to us. Very very sneaky.

19) Deng Xiao ping

Geez, you manage to insult this great person?!

19) Deng Xiao ping

Basically what you are stating is if only, which is opposite of what is happening now. the truth however is, singaporeans are been cramped down, supporting crazy investment at our own expense without much future security.

and do you think alot of singaporeans will spend in such a way? minority yes, but studies have shown that asians are usually thrifty.

a if only scenario is just, if only, ….which brings to mind an old american armed forces joke which is crude, with all due respect to you. if only your aunt had balls, she will be your uncle.

so does that tell us something

All these talks are so depressing, aren’t they?

How can we say “No” to how our money is being frozen, not for our use but for PAP’s use?

How can we let voters who can’t read or too busy to read realize this fact?

Can we have strong opposition parties who can resolve this problem created by the ruling party?

I’m not sure if anybody can have a good solution…. but at least this thread makes us think and ponder more…..

hi Creducator,

weak & strong are relative.

in unchartered waters, with no experience to count on we need leaders with a keen sense of inituition to think of solutions.

track record no use wan. trains need tracks to run, no tracks & trains become white elephants, & times like this even a bicycle will win the train in terms of speed, hands down!! ;)

hi Creducator,

weak & strong are relative.

in unchartered waters, with no experience to count on we need leaders with a keen sense of inituition to think of solutions.

The statistics about Singapore inflation is a LIE!!. It is never so low to begin with. The only reason why the govt publish such a ridiculous number is because it wants to short change singaporeans by giving them low interest rate for their CPF and bank deposits.

Lower CPF contribution from employers claim to keep jobs in times of recession but why was it not reinstated in good times? Furthermore, guess who is the biggest employer in Singapore? THE GOVT!! So guess who stands to benefit the most and who suffer the most with the cuts?

The minister for community development says that the new flats are relatively cheaper than the old ones as they are sold at a discount compared to the new ones. BUt let me ask you, who sets the valuation prices of the resale flats? Who gives the instructions to these valuers on the prices to set for the flats? THE GOVT. So effectively, the govt is artificially propping up the prices of resale flats so that they can make more money out of the new flats, even after their so call discount. All the people will now have to service their debts for 30 years. Think about you and your children in 20-30 years time…

Misnister of health claim the health cost has to go up, but compare the cost of private clinic to public clinics 20 years ago and now. There has been hardly any increase for private clinics but look at the govt ones, increment of several hundred percent!! either they are extremely inefficient, paying the ministers and civil servants too well, making too much money out of sick people, or all three, you decide!!

i think this is one of the best articles i came across in toc.
it really ties everything together in one perspective.
(plus with gd research put into it!)

one thing i have to quibble with though is its inflation statistics.
it used 2008’s 8%, which happens to be a spike year.
usually inflation is between 1-2%. here, selective use of statistic may be biased. Also, as a side point, there is no need to consider inflation and interest rates since they mirror each other and will cancel out.

and the same goes for wages too. different income groups see their wage rates increase at different rates, with the lower income being negative and the higher end increasing faster. i think the use of lower income grps as a yardstick may end up as a straw-man argument.

Not that lower income is unimportant. But saying ‘lower income cannot cope’ is not saying anything at all. of course, by definition, lower income cannot cope. the big qns should be how many singaporeans cannot cope. if it is just the lower income, we can have social policies to address it. but if it is majority of singaporeans, then there is smth fundamentally wrong with the system.

Of course, having said my piece on the way he argued it, I do agree with his general point that we are being squeezed from both sides. And I think the biggest squeeze comes from the sharp increases in housing prices.
If you go to HDB website, the price index in 1990 is 33.6 and the price index in 2009 is 140. Given that there are 18 years in between, on average, prices increased 8.25% annually (compounded).

I dunno what is the wage increase specifically for each segment of the population. But I am guessing most people will not have an annual wage increase of 8.5%. And this is not even taking into account the annual increase in medical costs and our lower employer contribution rate. So the fact of life is our real wage is decreasing..

For people who have higher income, they start from a higher base and decrease at a lower rate. For lower income, their wages are decreasing faster and they have less to start with. Double whammy.

19) Deng Xiao ping on July 6th, 2009 7.50 pm
“Do you think the PAP government never think of this?

, why not you write them down and let us debate over it? How are you going to solve the problem if the top 30% rich retirees withdrawing everything and say good bye to Singapore and”

And what is your problem. The money (the property) still belongs to them (rich retirees) and they have the rights to do anything that they feel is fitting.

Please remember, a consumption tax regime (gst) has already been implemented to extract (tax) something out from every single cent that they spent while alive. This in on top of income tax, erp, property tax, tv license, road tax, petrol tax, etc, etc, etc, etc, etc.

19) Deng Xiao ping on July 6th, 2009 7.50 pm
“Do you think the PAP government never think of this?”
“why not you write them down and let us debate over it?”

Good suggestion, indeed very good suggestion. Why not put it across as a topic for debates by varsities and aired in the national television for the viewership of the wider public. You think they (garment) have thought about this and will allow it.

Debate ? You just make me laugh. Do you need to debate over something that is rightfully yours.

Deng Xiao Ping:

You thinking that “rich retiress will withdraw everything and leave Singapore” actually hints on one thing: “Singapore is not a good place to retire.” Else, why would they want to leave?

They can also do this: Emigrate and give up Singapore citizenship. They sure can afford it, being already rich in the first place. They will still get all their CPF, and end up exactly in the same state you predicted would happen (rich retirees who have withdrawn everything and left Singapore).

I believe you’re mistaken though. Singapore is a pretty good place to retire if one is rich. Good (if expensive) medical care, well maintained infrastructure, easy access to travel destinations, and no estate tax.

As for the poor retirees… well… who ask them to be poor eh? (/sarcasm)

The hidden ugly side of Singapore
http://www.malaysiakini.com/letters/107799

Why should our ministers and senior civil servants enjoy taxpayers’ funded pension that pay them $179,000 per year from age 55 till death….while ordinary S’poreans are condemned to CPF system????

Whether CPF is enough for retirement depends on your lifestyle and your ability to manage your money.

The vast majority of Singaporeans cannot, and let me emphasize CANNOT! manage winfalls. A suddent withdrawal of $100,000 is a winfall for them, like top prize of lottery, and guess what?, they will treat it like a winning form a lottery with help from “friends”, relatives and family members.

We don’t kinow the minds of retirees, their plans, capabilities and circumstances. We can only guess from what we see, and very often sudden winfall gets lost very quickly…….. it comes quickly and it goes quickly.

If 70% to 80% of CPF is gone in 3 to 5 years, what is the retiree going to do for the next 5 to 10 years? There is absolutely nothing left, no money, no friends, no relatives and even no family (for some).

So How???

“The vast majority of Singaporeans cannot, and let me emphasize CANNOT! manage winfall.”

What winfall. It is your own money accumulated over many years of hard work with the luxury of money statements to keep you very well informed.

“There is absolutely nothing left, no money, no friends, no relatives and even no family (for some).”

Well, have your read the advertisement, active aging and I thought they have a way of encouraging old people of working till ripe old age.

“So How???”

As long it is not holding on to MY CPF money. If it is yours, ask them just to go ahead as you are quite supportive of it.

Hi 37) Think Again Pls,

“If 70% to 80% of CPF is gone in 3 to 5 years, what is the retiree going to do for the next 5 to 10 years? There is absolutely nothing left, no money, no friends, no relatives and even no family (for some).”

Is it better for these people to have at least “3 to 5 years”of quality living then suffer later or to have a life-time of suffering from day 1?

In the first place, it should be the govt’s duty to provide social welfare for the needy. Not only did they not do so, they have resorted to removing the individual rights on how they want to spend on their last few years.

I have spoken to a foreign research prof who is working in sg recently, as to why she has no intention of applying for PR. Her reply was, so she needs not contribute to CPF which cannot be taken out at will.

CPF is capped at around 5000 or there abouts based on the last info i know some long time ago.

By this, is it fair to say that CPF money held in CPF is the same for someone earning >5000 eg. 50k , 500k or 5 million ??

If so, is it not logical to say that the high income earners from a certain wage category onwards will not be affected as much as those < 5000 (or thereabouts) per month ?

Did you catch my drift?

lot of ppl in the mid 40-50 are damn f..king pissed with rules changes nowaday like no body business. they think like they run the whole damn country like own company. crap bunch of idiots there though they may belong to elities.

#40,

“If so, is it not logical to say that the high income earners from a certain wage category onwards will not be affected as much as those < 5000 (or thereabouts) per month ?"

someone earning super hi scale salary may only contributes the same as someone earning a salary which is what the cpf contribution is capped at. I feel the same too. So, the rest of their income is not affected? so the more income you have after the cap , the more you are less affected by the cpf contribution?

hey, i feel the same too.

Can someone comfom this understooding is correct? I sec 2 pass only.

41) mike on July 7th, 2009 3.05 pm
” lot of ppl in the mid 40-50 are damn f..king pissed with rules changes nowaday like no body business. they think like they run the whole damn country like own company. crap bunch of idiots there though they may belong to elities.”

What to do, the majority decided.

43) Peng Xiao Lee on July 7th, 2009 3.10 pm ,

i am quite sure nex election as long as we can vote, it’s going to be an impact. i am not surprised by either side’s plan towards the real day.

40) Oblivea In a Well on July 7th, 2009 3.04 pm
“By this, is it fair to say that CPF money held in CPF is the same for someone earning >5000 eg. 50k , 500k or 5 million ??”

Correction :
I mean cpf contributed per month is the same for someone earning the around 5000 and someone earning 500 million.

41) mike on July 7th, 2009 3.05 pm

” lot of ppl in the mid 40-50 are damn f..king pissed with rules changes nowaday like no body business. they think like they run the whole damn country like own company. crap bunch of idiots there though they may belong to elities.”

But what do you think about those who earn much more than 5000 per month where the cpf deducted may feel like peanuts to them?

Get my drift?

IMO, CPF belongs to that person. Should he/she decides to withdraw all CPF and migrate to some other country, so be it. We are not in any position, not even PAP should interfere that by delaying the CPF withdrawal age.

But sadly, it is quite clear and obvious that PAP has implemented many bias policy to delay its citizen from withdrawing their CPF money.

In the long term, I belive more people is likely to migrate if they have the ways to do so, and take away all their CPF with them. (me too is looking into this option)

46) Oblivea in a well on July 7th, 2009 3.18 pm ,

how long do you think those who earn 5000 per month would lasts when job are in danger of losing like right now? and where property keeps going up?

they have it all worked (plans) for themselves all these years that’s why they can affored anything now whereas, ppl like us keep struggling just to survive.

so dont be happy yet to those earn 5000per month boaderline unless you belong to them who can secure your future like a iron bowl. (that means yes man!)

47) mike on July 7th, 2009 3.21 pm ,

the only i look at it, give up citizenship and live somewhere which i am comptempeting.

Oblivea In a Well:

Not quite. You are right about there being a cap to the contribution though. So, after a certain amount of income, the CPF contribution is the same. You could also end up having to conribute more to CPF while having the same total gross annual income (salary + bonus).

The current cap is $4500, mutiplied by 17 months (= $76500).
Your annual salary contribution cap is $4500 x 12 (= $54000).
Contribution from bonus, etc. is $76500 – annual salary contribution (up to cap).

Example (If I am not mistaken, got the basic idea from CPF site):
Earn $4000 per month and 2 month bonus (= $56000 per annum), CPF contribution will be 20% from [$4000 x 12] + [$8000] (= $56000).

Earn $5000 per month and no bonus (= $60000 per annum), CPF contribution will be 20% from [$4500 x 12] + [0] (= $54000).

Earn $10000 per month and no bonus (= $120000 per annum), CPF contribution will be 20% from [$4500 x 12] + [0] (= $54000).

Conclusion: better to have higher salary and no bonus.

Oblivea In a Well

Just a sidetrack but relevant to your analysis of higher income being less affected, is also income taxation. I am not referring to the straight forward income tax but all the other stealth taxes like maid’s levy & eating out (2 most common expenditure in general). If a woman earns $2000 per month, she pays $400 levy, if a woman earns $20,000 per month, she also pays $400 levy. If you eat a bowl of noodle in the foot court costing $5, a fixed amt of say $1 goes to the rental, so whether you earn $2000 or $20,000 per month, you pay $1 (fixed) for each bowl of noodle you eat. This is why I say SG Govt robs from the poor to give the rich. Its always been the case and it always will be because there is nothing else they can do to attract the rich other than tax benefits. Instead of using their brains to exploit the rich for benefiting their own citizens, SG is doing the other way round.

aiyoyo

really worry commoners need work till 65yr or more,

how to take it? where is the solution elites?

sad story

aiyoyo

Look at 20% of your salary going into CPF as taxes paid to the government. Don’t expect to get it back. You’d probably be dead by the time you can get it. Besides, the minimum sum is going nowhere but up. $100 can pay for groceries today. Imagine getting $110 back 40 years later when it’s as small as $10 now. 20% CPF contribution IS tax. To the still unconvinced, HDB flats are a rip-off & you pay much more than you should. The amount you shouldn’t have paid for is not unlike tax.

A quick question … what happen if someone die before he reach 65? Would his family inherit the money? One lum sum or installation? What if that someone is single and has no immediate family (thus PAP can legally pocket the CPF) ?

sadoh, I strongly believe that, given the government’s obvious greed, would suck in the money like a powerful vacuum cleaner from the year 3000!

Those retirees who retired at age 55 were very lucky to have enjoyed the perks in higher employer/employee contributions and can be admired for travels and leisure……Ouality of Life!

Life is all about timing and if one is lucky to be in that category…..it is like striking 4D. But what I hear that some dread to retire at age 65 but no choice as the video said it all ……work to your grave……No wonder couples are not producing for the saying that the new born these days, is from cradle to grave…..born and work till you reach old age to your grave……….
Some maybe cash rich but no time for leiaure whilst many with commitments due the high cost of living, will ultimately realise that there will be “0″ quality of Life!…….this will lead to severe depression and many unhappiness

maybe its time for the state to rethink on restructing the cpf.. if they are going to made it a burden on the citizen… then have it will just defeat its orginal purposes.

Rather than using it as a vehicle to ensure a saving for retirement… why not instead restructure it to meet the current demand of singaporeans. I pretty sure that most singaporeans’ main usage is for payment of housing and medical. So just have it for these purposes then…

54) sadoh

If you have made a valid CPF Nomination, it will be distributed to your nominees in the proportion as stated in your nomination upon your death. If you have not made a nomination (why not?) it will be distributed to your family members in accordance with the intestacy laws.

57) Whatsup

///… maybe its time for the state to rethink on restructing the cpf.. if…..usage is for payment of housing and medical. …../////////

It is now still primarily used for these two purposes.
The promise that one will get his money back at 55 is broken. That is the issue here.
Regardless of whether one has paid up his home, the remaining CPF money is rightfully his at 55 to do what he deems fit. If one has yet to fully pay his home, the same applies, he has the right to his CPF money at 55, he can choose to pay outright his outstanding loan, or pay over a peirod of time using his withdrawn CPF.
The medisave minimmum has ballooned to more than $30 over the years. This amount is locked in the CPF forever. The $30 k will be wiped out in one major medical episode in your life, so whether they put the minium at $30k or $300k it is still not going to be enough. If you buy hospitaisation insurance, you do not need that huge sum to cover your medical.You need only to pay a few hunderd buck in premium per annum. So the rational for the medisave minumum is flawed.

>> 51) AngelVision

” all the other stealth taxes like maid’s levy & eating out”

I think you have mentioned ’stealth taxes’ before.. and while i agree maid levy may fall in that category, i can’t understand why eating out is a tax.

Sure, the price of food includes rental- but the rental not necessarily goes to the govt. it can very well be given to some private foodcourt operator/shopping centre such as Food Junction, Kopitiam, etc.

Plus the definition of tax is a payment that is mandated by the govt in exchange for nothing concrete. Rent is payment in exchange for something– a space to run your business- which is a legitimate business cost like other costs such as noodles, gas, etc.

Actually, if we think about it, Singapore is not unique in holding people’s money for retirement. That is basic premise of govt-run retirement schemes in general.

Let’s put it this way, if we were all living in a welfare state, we pay taxes (think parellel to our monthly CPF contributions). When we become old, do we get back one lump sum of 60k? Nope. We get some fixed amt every month. (think CPF payouts).

Probably the only difference between a welfare kind and a CPF system is CPF lacks the “Robin-hood” redistribution element. In terms of govt-holding money, all countries’ govt retirement schemes are the same.

Which probably brings to the question- why govts (Sg and the West) even put a retirement scheme (regardless of form) in the first place. I guess the experience of many countries is people tend not to plan for retirement.

So people who are disadvantaged by this govt intervention are usually people who CAN and WILL manage their money better than the govt and make it last longer. Unfortunately, this is usually the minority and since there isn’t a perfect filter, they just have to go along with it.

For people who are unhappy that they can’t spend the money now, (which seems to be the majority of the commenters) well you are precisely the target group which all governments target! =)

hi RW,

for some who may have already retired or are near retirement age, who are retrenched currently or is in financial difficulty, they may need to spend to cover daily/monthly expenses.

i hope you do not assume spending the CPF more to frivolious spending. since our govt said reiterated it is so unwilling to provide much welfarism to individuals, yet provide blanket coverage for companies whether they are at risk of winding up or not.

our govt understands that if companies cannot survive in the short term, will not be there for the long term. is it any different for individuals? can someone 45 years old not eat till he or she gets the payout years later?

61) RW

Your comments are reflective of the reality of things in the world and at home with regard to govt-run retirement schemes. CPF or what-you-may-call-it in some other land, are blunt tools.

61) RW on July 8th, 2009 12.48 am

Your explanation as deduced that our cpf is meant to ‘equalise’ the high-tax welfare-state ‘redistribution’ effect in some other countries but not the “Robin-hood”element would be more acceptable and less painful for us to accept if at least the policy makers at least do not give the impression of some robin-hood tendency as far as their own compensation and retirement scheme is concerned.

“For people who are unhappy that they can’t spend the money now, (which seems to be the majority of the commenters) well you are precisely the target group which all governments target! ”

So what does that mean, that it is alright for them to do so. And please do not mention all (emphasis intended) governments as a lot more countries have other elements in their system to ensure that asses are kicked when they need to be kicked.

ugdragon, I do echo your perspective regarding this CPF scheme. The threat of inflation and rising living costs will diminish the temporal value of the lump sum of $$$ in our CPF accounts. CPF is merely the perfect $$$-sucking vacuum cleaner to generate cold hard cash for our government to invest. Actually, the minimum taxes we pay to the government is now at least 27% before IRAS’.

54) sadoh on July 7th, 2009 5.49 pm
‘A quick question … what happen if someone die before he reach 65? Would his family inherit the money? One lum sum or installation? What if that someone is single and has no immediate family (thus PAP can legally pocket the CPF) ?’

Many roads lead to Rome, if you know what the fookie i mean.

47) mike on July 7th, 2009 3.21 pm
‘IMO, CPF belongs to that person. Should he/she decides to withdraw all CPF and migrate to some other country, so be it. We are not in any position, not even PAP should interfere that by delaying the CPF withdrawal age.
…….
In the long term, I belive more people is likely to migrate if they have the ways to do so, and take away all their CPF with them. (me too is looking into this option)’

I shall put it simply. IF Malaysia can give an attractive deal for singaporeans-who-dun-mind-migrating, I wonder how many would not mind cashing out their CPF to retire in a less costly place like in JB which is just a short drive away?

Feel my drift.

erm, is it a good idea of leaving your comments here as they require complusory e-mail address here?

CPF is probably both a social secuirty AND borndage. If you want to leave, nothing would stop you. As for social secuity. Its for social. meaning less burden on the state…even if you’ve got to live like a churchmouse.

Considering human nature generally isn’t too wise with money…even in plenty.

#68 Izekiel

You think gahman delay our CPF withdrawal cos they are caring and want to prevent us from spending it unwisely ??

I might believe that IF temaSICK and GIC didn’t lose so many of our billions and IF our Papies & their cronies are not paying themselves the Guinness World Record for top politicians pay !!!

>> 63. Kopitiam Apek

Thanks for the comment.

>>64. To 61) RW

Yes, i know people are complaining about minister’s high salary.
Yes, i know people are complaining our political system- not being able to ‘kick their ass when needed’.

Thank you for your comment on Singapore politics.

>> 62 Mice is Nice

“i hope you do not assume spending the CPF more to frivolious spending”

I think you are right, in that not all spending is frivolous. If a person is living from hand to mouth, spending more is definitely necessary.

But one point is that even for people who are living from hand to mouth, one should be mindful that are many such years ahead (85-55 is 35 years). We might solve the problem now but it is a short term solution.

We should dissect the issue to two parts:
(i) CPF being not enough
(ii) CPF is being controlled and slowly rationed out.

If CPF is not enough and our answer is to simply let everyone withdraw more for retirement, that is just redistributing the same small pie, pushing the problem to later. I agree with the author that the main problem is CPF is not enough (see #31). In that case, the real solution is to grow it or supplement it with more ‘welfare’ support.

Now the thing is many people seize upon the issue of CPF not being enough and try to muddle it with the issue of ‘removing controls and rationing’ of CPF.

Firstly, it does not address the root problem but merely postpone it.

Secondly, it makes sense to do it and that is why many countries follow the principle of “control/rationing retirement funds” in the various retirement systems they implemented. (#61)

I suspect unlike you, many people deliberately muddle the two issues to argue for a freer hand in spending the money! =)

The crux of the issue, like all else, is the absence of checks & balances. Its like your money is being held by a mafia gang telling you that it is safely yours until retirement and they keep finding excuses to delay dishing it out or reducing it. The worst is, this “mafia gang” is above all law and there is nothing to stop them, no authorities, no laws (laws are made by them), in other words they ahve absolute power to do anything. In this scenario, if you can put your money with a legitimate, regulated pension fund investment company, you will feel safer.

72) Flipflop
I assume you are one of the smarter few who put your $$ with Lehman brothers
instead of cpf , who may run away with your money one day.

Let’s clear the air, cpf can be used for investment, your medical bills, your HDB purchase. You will eventually get back your money at 65, which is meant for your retirement ( and medical bills which at this age is usually the case )

Although not spectacular, there will 2.5% interest growht that is guaranteed by the government, so your $ is not sitting there doing nothing.

Upon death, your money will go to the people of your wish or your immediate family.

So the whole arguement here is that
1. Government take away your money
2. You will die by 65 and not see your money

So my question is:
1. will you be disciplined enough to save your 20% and not buy a new subaru wrx?

2. even if you are savvy enough, will your investment institution be guaranteed not to collapse or default till you are 65?

I am sure there will be comments like
” i can invest and have greater growth”
” People do not have enough to eat”

i am very sure there are alot of investors who can get more than 2.5% return with their money, but are you sure as a government running a country, they will say: Hey take your money and invest in stocks and shares and get spectacular return but do not come looking for us when you lose it all”

or

” Look, i will keep at portion of your earnings and give you back with a bit interest with our country stamp guarantee”

For those who say people may need the money to feed themselves, well it is like putting your money in another pocket and taking it out, you are still using the money meant for yourself when you retire, yes you tide over, but if you cannot have enough now and take from the future , you will be much more worse off when you hit 65.

Besides people who cannot even feed themselves now probably cannot even contribute to CPF, they should be thinking of help schemes and not cpf.

So the reason why they are doing this is mainly to ensure the aging population will have some savings to tide them over whateven cost they may encounter good or bad, it is no different from pension fund in US and mind you, those are not immune to financial risk and mismanagement.

So why is it pushed to 65 instead of 55? I do not want to think of our government as saints but it is a practical decision:

1. Aging population with longer life expectancy
2. More problems encounter at 65 instead of 55 ?
3. if retirement is set at 65 , you probably will have to work until then and gov will have more money to invest ?

So you are complaining that you cannot touch your money and will die by then, i am sure your family can find some use with it, and you are one of those that probably don’t buy life insurance.

Lastly, the problem that CPF is not enough.

Well i think i think it is supposed not to be enough, i pressume it is supposed to be part of your savings. If you can answer my 2 questions above and get spectacular year on year returns with your 20% then yes it is not enough, but CPF i believe is meant for Common people and as such it is planned with that in thinking , and even rich people may go broke some day and CPF will act as a parachaute saving for them.

If CPF which is your saving is not enough, then maybe you are not saving enough?

OR

You are not earning enough …..

I am not Pro-gov but i see this CPF as a pension/savings for the aging as well as
a source of income to invest. This is what is called nation planning.

If not , you can always vote against them and take your 20% to buy your WRX.

Enuff said.

Weiqin #73

You are either saying that Lehman is the only investment company around that is legitimate & regulated or you are saying that I am one of the smarter FEW who cannot read the small prints.

Can the Govt actually guarantee that this compulsory savings will be there for retirement and medical? What if there is a change of ruling party in the Govt? What if the ruling party do a runner? Who can guarantee they won’t unlike Lehman?

As CPF money is allowed for investment (more like shares speculation), what if its lost in the ‘investments’?

I think most people do not fault the idea of CPF, but have doubts on the people in charge of the funds.

aiyoyo

own $, decide by the owner how to use ma, correct?

unless the fund manager super good, then manage people’s $,

else still back to basic, owner manage own $ la, simple logic…

aiyoyo

aiyoyo

They scared you so stupid mah (Weiqin #73), anyhow spend your money buy car, buy Lolex, buy toto, then got no money later on, or dump your money in Layman and lose all. But hor, I tot PM said Sporeans so educated & employable some more leh (means must be clever to make money), I oso wonder then how come cannot ownself look after own money. Weiqin said hor, we will all kenna conned by Layman, so better let gahmen (God) look after our money lah.

hi RW,

post #71 on July 10th, 2009 2.04 am

////I suspect unlike you, many people deliberately muddle the two issues to argue for a freer hand in spending the money! =)////

yeh, you have a point too. there are enough old men who may be tempted by young foreign women to empty their CPF kitty.

but i think there should be more flexibility for people in this extra-ordinary difficult times, afterall there are real cases where mouths need to be fed, kids need money for travelling expenses, what more for some with maids, pets, so on….

Lee on how to keep Singaporeans from rioting by working with no retirement

Mr Lee: “…..A society will remain cohesive only if there is a certain sense of equity and fair play. If I have unbridled capitalism, winner takes all, like in America, and have an underclass, I will find my minorities over-represented and the society will be in jeopardy. They will riot.

“So, what do we do? We raised the levels of the losers. We give them homes which they will not be able to buy, we give their children equal education in schools they otherwise can’t afford, health services and so on and so on and where they have lost jobs because the jobs migrated and they were not educated enough to take the jobs that’s coming that requires higher skills, all right, you take this job, his lower pay, we make it up. Here is Workfare, give you the extra, but continue work. If you stop working, we are giving you nothing. We want no layabouts. You work, we make up. So, you find ingenious ways to keep them working and sufficiently rewarded so that they feel they are not abandoned and as a constant challenge and constant adjustment during this period.”

….read full text of “TRANSCRIPT OF MINISTER MENTOR LEE KUAN YEW’S INTERVIEW WITH ARNAUD DE BORCHGRAVE OF UPI ON 2 FEBRUARY 2008 AT ISTANA” at http://www.channelnewsasia.com/annex/MMinterview.pdf

77) mice is nice
///yeh, you have a point too. there are enough old men who may be tempted by young foreign women to empty their CPF kitty. ////

drool…. : )

Quote :
“We raised the levels of the losers..”

Look at his choice of words. He divides his people into winners and losers.
You can tell he harbours contempt for the majority as they are being seen as ‘losers”. They are only fit to live in pigeon holes.

I feel so sorry that the man, often solely credited by the media for Singapore’s success, is still around. What special herbs he is taking to prolong his existence?
But don’t despair, like all the dictators and emperors that have come and gone, this nightmare will soon come to past. No one can conquer death.

By the way, the man is a good friend of Henry Kissinger.

Read this :
Dr. Henry Kissinger wrote: “Depopulation should be the highest priority of U.S. foreign policy towards the Third World.”
National Security Memo 200, dated April 24, 1974, entitled “Implications of world wide population growth for U.S. security & overseas interests.”

Kissinger is very much alive today. They went to the Bohemian Grove (powerful rightwing industrialists, financials, politicans) gathering where Mr Lee was mistaken for being a waiter. Bohemian Grove list -http://obscurantist.com/texts/bohemian-grove-membership-list/

You can tell what sort of people associate with men like Kissinger. The man credited with Singapore’s success also said he favoured John MCain as America’s president instead of Obama. John Mcain, a rightwing Republican, is a warmonger and believe only in the language of force.

Very telling, isn’t it?

[...]  CPF – social security or social bondage? : The Online Citizen – a community of singaporeansPosted by g38 via FriendFeed   [...]

Hi all who want to see changes,

I guess we have all spoken much here. You may like to see my suggestion for change advocators at http://theonlinecitizen.com/2009/07/more-and-more-jobs-available-but-nobody-wants/comment-page-2/#comment-86776 (67) creducator

Can anyone guarantee that CPF contributors won’t end up like victims of “Lehman”?

That is the paradox of Singapore. They say that CPF is good for you so that you cannot anyhow suga-suga invest and blame the government for poor investment. And yet the CPF money are taken by the gov for hind investment, and then no one blame the government ? Guarantee 2.5% ? Please lah. Guarantee what ? Minimum sum and special account increase like no-man land too, these increase and CPF interest not increase ?

65 years old ? last time, I heard the oldman says 67 years old, and it surely increase with time. O…. annuity coming soon… that i’m going to pee my pants.

Did the gov even do what it preach about hind investment ? They gamble on your behalf, lose money and you pay for it ? Not true. When gain money, “show us the money” we ask. No, Shut Up, they say, “because that is for your own good”.

Working like ponzi scheme and then pretend it is not.

Have not read every post on this thread but there seems to be misunderstanding or confusion on a number of issues regarding CPF. Here are my 2cts worth on:

1. CPF takes care of retirement.
No, it can only supplement your other savings/investments for retirement. As S’pore $ interest rates had been low for many years, CPF savings have not grown fast enough to offset inflation. Basically, one has to scale down one’s lifestyle in retirement if CPF alone is relied on.

2. CPF pays low interest
Actually it is higher than savings & FD rates for some time now. In fact some who had more than their minimum sum on reaching 55 actually left what they could take out in CPF to earn the higher interest. They seem to have full confidence in the CPF Board. Someone posted that CPF is a Ponzi scheme. This peculiar anomaly of paying a higher interest may bolster his view.

3. Minimum sum & age at which CPF money can be withdrawn keeps rising.
This is due to losing battle with low interest rates. At age 55 or whichever age CPF money can be withdrawn, the minimum sum is locked in for a number of years (previously 7 years) to grow the sum. It is then withdrawable, the amount depending on the interest rate at the time the minimum sum is placed in an annuity scheme. For those who retired years ago the annuity scheme paid a good monthly sum till death. Sorry, for those who are retiring soon, the same amount put in an annuity would pay less. Hence, the increase in the minimum sum in future looks likely so that a certain sum deemed appropriate for a retiree
can be paid out. Withdrawal age has to increase to allow the minimum sum to grow over a longer period.

4. Why cap salary for which CPF has to be paid?
For the employer’s benefit. Previously the employer had to match CPF paid by employees – 20% of wage for employee & employer. CPF probably reckoned that employers would find it most expensive to pay 20% for someone who says earns $10000 p.m. Employer’s contribution is less now after some tweaking during the bad times so maybe the cap can be increased.

Lastly, on ways CPF scheme can be improved. Mainly on its attempt to have one size fit all and to last a lifetime after retirement. Below a certain amount, let the guy take it all.(ha ha). Set a reasonable minimum sum and pay the monthly sum calculated for a lifespan of 80. If the guy lives past 80, the state continues to pay the monthly sum. How long can the guy rely on the state?

The picture gets clearer as points are put forward here. I can only agree to one purpose of CPF – for mortgage payment. The reason that it is for retirement is completely flawed. As for medical, we still have to rely on private insurance as the CPF schemes are pathetic.

When you pay towards a private pension scheme, the company puts at least 80% of your money in safe investments, guaranteeing a decent rate of return, with the remaining up to your choice of risk. So if the rate of return is high (when economy is good), the money accumulates and IT IS YOURS, YOUR MONEY IS GROWING IN TANDEM WITH THE VALUE OF THINGS.

With CPF, it is cash savings that we are talking about, with a miserable interest rate. Of course the money will depreciate in value due to inflation by the time you retire. Therefore CPF savings for retirement will NEVER be adequate.

85) Mike2cts

Thank you for your positive contribution. You add value to the discussions in TOC.
Your point about one size fit all is very valid.
In all national schemes, that is always the problem. It becomes a blunt tool and will inevtitably cut some the wrong way.

“In all national schemes, that is always the problem. It becomes a blunt tool and will inevtitably cut some the wrong way.” – KopitiamApek

Would fully agree if you are referring only to Singapore! Its not necessary like this in most First World Democratic countries.

the more i revere MMLee,the more i fear him.I do not know why.Have i fallen into
a trap of some kind of cultic force?.