The following video is by Singapore News Alternative. This short video examines the factors affecting CPF, making it inadequate to meet most Singaporeans’ basic retirement needs.
HELP keep the voice of TOC alive!
If you like this article, please consider a small donation to help theonlinecitizen.com stay alive. Please note that we can only accept donations from Singaporeans. Thank you for your assistance.Do you have a flair for writing? Volunteer with us. Email us your full name and contact details to theonlinecitizen@gmail.com
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
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.