An Open Letter to Singaporeans about Compulsory Annuities
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This is what you said in the initial stage of this thread:Originally posted by Rock^Star:Tell me, my friend, your understanding of annuities.
1) Where are annuity pools normally invested?
2) What are the factors that determine the fixed payout?
3) How much is the interim interest before payout? (based on market rates)
4) Roughly at what age does an annuity take to break even?
Annuity schemes are not attractive only if the interest rate is low. Anyone who wants to understand annuity better should go study finance in detail. Reading papers and hearing what people say is only partial, not total understanding.
And also:
The problem (as you failed to see) is that the majority of people are not financial-savvy, nor can they save (either not a habit or don't have money to save). How do you deal with these people?
While I agree that there are many who are not financially savvy, it is also worrying that you see annuity as the solution to it.
Since you indirectly profess to know so much about annuity, kindly back it up. Please do not ask me to read up other sources as I simply want to understand your knowledge on this. This will only make a for more meaningful debate.
But then again, you are going to deflect by providing some God given reason, I'm sure....because your knowledge is at most, superficial.
Prove that wrong. -
Once the annuity is compulsory, does that mean that even if one disagrees, the system will deduct the premium from your cpf and there is no need authorization / approval by way of, for example, signature ? thus Opting-In by default? Is it really true ? really so?? and there is no way for those younger than 50 now (non-muscle-diseased) to object from using your cpf for the annuity in that once made compulsory, you are into the scheme automatically?
I am just trying to know in advance what the process will be like. I am so concerned citizen. -
i'm not really educated, especially in economics, but i do have some points to raise out.
1. honestly, i feel that the CPF scheme is to be praised, as in, seriously i feel many of the younger generations are spoiled brats, big spenders who duno how to save (explained by the rise in the number of people who own banks credit debts). also, being a volunteer at Lion's Old Folks Home, i've heard of many stories as to how CPF has helped many of the old people.
2. the annuity scheme deserves some praise too. as we advance in medical fields, many people are living a longer live, take japan for example. and we do have mediShield to cover some medical costs of old age. BUT will someone please help me find out if Singaporeans are really living to an older age or are we dying younger. i'm not good at finding facts or sources, so please help me with this.
3. what i don't understand is, everyone hopes to invest in something that has reasonable returns. and seriously, for CPF such large amount of money, i feel the amount of interest earning is like SHIT. i applaud to the fact we can now use CPF to invest, but what about the annuity? it is also a form of investment, and the amount is not small too, do you guys think the interest rate is like CPF returns, which is BULLSHIT? what do you guys say? if i didn't remember wrongly, even the WORLD BANK says our CPF returns is very little compared to other countries and compare to the standard rates right? even our banks offer higher rates right? someone please justify me on this as i'm not very sure
4. i think we are paying too much for our "elites". true they come up with good ideas, which in my oppinion should work well and should benefit many if applied appropriately. but even with their high pays, i feel they they are still very "corruptedly" greedy. come on, i think with that amount of money, i put in normal savings account or fixed deposit of any bank, the interest i earn is higher lor.
5. somemore, i think my investment skills are so much, perhaps even far beyond our "elites". look back and see how much money they have lost, and whose money is it? and imagine the kind of peanuts they so call "return" us. i just wonder, will they be able to take out the amount if all of us decide to withdrawl our CPFs, i think they will be declared bankrupt and still owe almost half the nation of their CPF money. and for the "SMALL FRY" payout stated, i DEFINITELY feel my investment skills are far superior as i get to earn more interests using my methods (what about buying UNIT TRUST? someone please help me verify if this is true)
6. lastly, my main concern is : "WHERE WILL ALL THE MONEY GO IF I DONT MANAGE TO TAKE OUT THE WHOLE SUM?" can we draft a will saying we want to give the money to our children or charity (lif i recall correctly, we can do this to our CPF right? so that they cant eat our hard earned money)
my sentiments is just that, the "elites" lost too much money due to "POOR and BAD" investments, now they no money, just think of other ways to get from the CITIZENS, ways which they don't have to return the money. haha, to think they want us to be responsible for our money when they don't wish to be responsible for our money but still want to use our money and don't give us the RIGHTS to protect our money. i mean, the scheme seems good and logical, but really the payout is NOT, i repeat, NOT reasonable for the amount.[/b][/u]
just put it this way, you pay them too much, they dun know the meaning of hard earned money, thus they just think they have unlimited resource to waste, to play with, anyone agrees on this?
i agree to someone who mention in this thread the "elites" really think and behave like babies. small small think only sue, come up with creative interesting ideas but implement them childishly, by being selfish and not thinking of others -
YOu will know soon next monday after the parliament meeting. Whatever, it will benefit the greedy gahmen. There are people who don't buy annuity but have sufficient savings to last them for a life time. Didn't the greedy PAP consider this?Originally posted by reddressman:Once the annuity is compulsory, does that mean that even if one disagrees, the system will deduct the premium from your cpf and there is no need authorization / approval by way of, for example, signature ? thus Opting-In by default? Is it really true ? really so?? and there is no way for those younger than 50 now (non-muscle-diseased) to object from using your cpf for the annuity in that once made compulsory, you are into the scheme automatically?
I am just trying to know in advance what the process will be like. I am so concerned citizen. -
oh yeah, one more thing to add, looking at their past investments, even they, the "elites", rather invest most of the money overseas then to invests in their own country, rather invest in foreign talents then local people.
even they themselves are not secure about investing in their own homeland, so why should we do the dirty work and invest in them, when we can also follow them and invest overseas to earn more.
anyone support me on this? -
As the saying goes.. too much power and money corrupts.Originally posted by o_x:oh yeah, one more thing to add, looking at their past investments, even they, the "elites", rather invest most of the money overseas then to invests in their own country, rather invest in foreign talents then local people.
even they themselves are not secure about investing in their own homeland, so why should we do the dirty work and invest in them, when we can also follow them and invest overseas to earn more.
anyone support me on this? -
You raised a few interesting points, o_x. My opposition to the annuities is almost entirely on economic grounds.Originally posted by o_x:i'm not really educated, especially in economics, but i do have some points to raise out.
1. honestly, i feel that the CPF scheme is to be praised, as in, seriously i feel many of the younger generations are spoiled brats, big spenders who duno how to save (explained by the rise in the number of people who own banks credit debts). also, being a volunteer at Lion's Old Folks Home, i've heard of many stories as to how CPF has helped many of the old people.
just put it this way, you pay them too much, they dun know the meaning of hard earned money, thus they just think they have unlimited resource to waste, to play with, anyone agrees on this?
If the younger generation doesn't know how to save, why do you think the government confiscating their money will teach them to save? Economically, if young people thinks the government is saving for them, they will reduce their own private saving. The government pushing back the CPF payout date, is only too clear an indicator it is not actually saving the money. The government is very worried now it cannot pay out the money. It has actually spent everything on public works like Biopolis.
About governments thinking they have unlimited economic resources, that is also explainable by economics. The government is divorced from profit and loss unlike private enterprise. Whatever its performance, it can continue to tax away. It cannot allocate private resources efficiently. Therefore they come up with new pathologies to justify their existence as planners and managers. -
I might be ignorant. I'm looking at the 1990-2006 Population Statistics.
It seems that the number of people making it over 65 years and above increases by 1000-4000 annually. (85 years and above, about 1k annually)
However the people making it over 55 years and above annually is increasing 15,000 to 20,000 annually.
At age 80 your probability of dying is more than 10 times more than when you were at age 55. At age 70, 5 times more than age 55.
Does that mean only a small percentage of people will get back the annuities they've set aside from their minimum sum. I understand that the money goes back to the government when they die.
This does look a lot like state-sponsored robbery. Any light on this? -
Actually, where does the money actually go? I am not too familiar with policy, but simply arithmetic indicates that unless one lives long enough, one may never get back all the CPF.Originally posted by maven2:I might be ignorant. I'm looking at the 1990-2006 Population Statistics.
It seems that the number of people making it over 65 years and above increases by 1000-4000 annually. (85 years and above, about 1k annually)
However the people making it over 55 years and above annually is increasing 15,000 to 20,000 annually.
At age 80 your probability of dying is more than 10 times more than when you were at age 55. At age 70, 5 times more than age 55.
Does that mean only a small percentage of people will get back the annuities they've set aside from their minimum sum. I understand that the money goes back to the government when they die.
This does look a lot like state-sponsored robbery. Any light on this?
Quite frankly, one wonders sometime what's the state of our reserves, or are we simply inundated with packs of lies? -
Originally posted by reddressman:
u will win if u fight the PAP in the US court.
Dear forummers, fellow citizens, and friends,
LEND ME YOUR EARS!!
I am a concerned citizen, concerned about my life here and how schemes introduced will impact my retirement. I have some fundamental questions to ask:
1. Is it [b]LEGAL to disagree with policies , any policies proposed?
Must all policies be accepted?
Do I have the RIGHT to agree to DISAGREE?
2. Do I have the RIGHT to not accept a proposed policy?
Would it be ILLEGAL to not accept such?
Would I be breaking the law if I prefer to buy annuity via the private path?
3. Is it LEGAL to reject a proposed policy?
Is it LEGAL to reject a proposed policy and DEMAND for a better policy?
4. What RIGHTS do I have when it comes to managing my own Money?
What RIGHTS do I have when it comes to managing my own Retirement?
What RIGHTS do I have when it comes to managing my own LIFESTYLE?
As phrased above, I am a singaporean who is not sure what can I LEGALLY do and what are my RIGHTS. I am naive and kiasi, kiasu, kiasai. I live in a democracy but I do not fully understand its meaning.
Please enlighten.
[/b] -
Hi,Originally posted by TheGoodEarth:I read the rest of your post. While there are good and legitimate points, there are also misconceptions coupled with grudges.
One line seems to stand out from the many threads in this sub-forum: that any ideas, policies, actions of gahmen, are intended to gain more monies out of people at their expense. So compulsory annuity scheme is one way gahmen robs you in order to build another university. This sounds too contrite. By your reasoning, everything can be linked when they are far from being related. So, how was NUS build or SMU built? Annuities?
Annuity schemes are not attractive only if the interest rate is low. Anyone who wants to understand annuity better should go study finance in detail. Reading papers and hearing what people say is only partial, not total understanding.
I will put it to you very simply: do you have any better way to see the needs of those living into golden years? Never mind what the statistics say. Can you say for sure you won't live beyond 80, 90, 100?
While I do not have any facts to back up anything cos wat i'm going to write here is solely based on my views ... I have been reading a lot abt Anti-PAP stuff and I even bought a book written by CSJ and so my views can be pretty distorted and biased against PAP..
That being stated clearly, these are my views...
After I graduated and started working, I have been paying more attention to politics and govt policies...
So far, what i have been witnessing is that in the recent years, PAP has been making policies to try to increase the debt of Singaporeans... as well as bashing the opposition...
How do they increase the debt ?? Simple... By letting in FTs freely to suppress the wages of Sporeans and increasing cost of living by GST, HDB housing etc... My personnel view is that they are doing this to bind the ever inceasing effluence and mobile sporeans....
It is really funny on using reasons like "helping the poor" to raise GST... Likewise.... I believe many essential public services should not be privatised becos spore is too small... Services like Transport, Public Utilities, etc... So far, many fare hike has been implemented and these companies has been reporting record profits over the years and consumers cannot do anything because they are basically a monopoly or oligopoly..
As for the opposition bashing... just look that the different treatment opposition gets during the last GE... I do not need to comment further...
PAP also did not answer many of the questions raised by the opposition.... Important questions like the actual cost of building HDB... The actual usage and sum of the CPF pool... etc...
Another crap is that they actually dare to raise minister's salary to $2 Million a year and benchmark themselved to the top 5% of the private sector... Anyone of engineering background knows that these top 5% are outliers and should be ignored in SPC.... Yet another unknown fact is that Ministers are still given hefty pension after they retire and yet commoners need to buy compulsory annutites using our OWN money...
It is also saddening that the sons and daughters of these Ministers or MPs have an elitist mindset... Look at the WEE SUE MENG (I think I spell incorrectly) and LEE HONG YI's case... Some may argue that LHY is a gd whistleblower but I think he is just another spoilt brat thinking that just because his father and grandfather is LEE...He can do such thing...
Anyway, moving on... Look at the recent Durai's employment as CEO of monthly salary of $25,000 ... Doesn't that seems suspicious? Govt has been talking abt the Yellow Ribbon project and yet some ex-convicts are rejected from joining the public sector... and YET... someone whose's integrity is doubtful can still secure another position as CEO in a company with links to GLC...
While PAP has managed to transform Spore from 3rd world economy to 1st world Nation in a mere 40 yrs, and many great policies has been made in the past by the OLD guards, I personally feel that the current leaders has already lost their compassion to lead the people... As living cost soar and wages being suppressed, and FTs being let in to replace the aging population.... I seriously has doubt whether i will retire in my motherland in future...
Many many singaporeans have left our shore to look for greener pasture and to escape this salvery by debts... Some courageous ones stayed on and joined the oppostion.... Many still are apathetic abt the govt policies... For me, I will try to survive in my motherland but as a young Singaporean who has just started working just about a year ago and still have abundant youth and energy to shape my life, i am beginning to question the purpose of continuing to serve and contribute to a country that will eventually forsake u and does not take care of u when u become old ....
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Its amazing after all these years, the SOP is not noticed.
First the public is let on the intention.
Then, the general response is observed.
Then the actual decision is cast.
We are jumping to lies, yes. But whose lies?
Wait for the actual details. Right now you are casting aspirations on mere heresay.
Everyone knows that many will not reach to 85 of age.
Of those that do, all will start kicking the bucket soon.
Only the rare geraitric will reach 100, a mere 15 years from 85.
This is know and will be taken into consideration.
So don't churn your guts, just yet.
If you can, contribute a sensible suggestion.
I was thinking of the DPS.
If a person dies before 61, there is a payout to the dependents.
If he lives past 61. No payout.
This DPS can be tweaked to service the annuity scheme for those who live past 61.
Therefore up to 60 its the DPS scheme, after 61 it morps into the annuity scheme.
But then why have two schemes?
Rename the DPS as the Annuity.
Singaporeans can start from young, at very low contributions.
Die before official retirement age, payout to dependents, after retirement age, if still living, annuity payments to supplement low wages from restructured jobs.
This is just an idea. The details like premiums, and payout dates, I leave it to the experts. -
I feel that you have an understanding of public debt.Originally posted by Zelphon:Hi,
While I do not have any facts to back up anything cos wat i'm going to write here is solely based on my views ... I have been reading a lot abt Anti-PAP stuff and I even bought a book written by CSJ and so my views can be pretty distorted and biased against PAP..
That being stated clearly, these are my views...
After I graduated and started working, I have been paying more attention to politics and govt policies...
So far, what i have been witnessing is that in the recent years, PAP has been making policies to try to increase the debt of Singaporeans... as well as bashing the opposition...
How do they increase the debt ?? Simple... By letting in FTs freely to suppress the wages of Sporeans and increasing cost of living by GST, HDB housing etc... My personnel view is that they are doing this to bind the ever inceasing effluence and mobile sporeans....
It is really funny on using reasons like "helping the poor" to raise GST... Likewise.... I believe many essential public services should not be privatised becos spore is too small... Services like Transport, Public Utilities, etc... So far, many fare hike has been implemented and these companies has been reporting record profits over the years and consumers cannot do anything because they are basically a monopoly or oligopoly..
As for the opposition bashing... just look that the different treatment opposition gets during the last GE... I do not need to comment further...
PAP also did not answer many of the questions raised by the opposition.... Important questions like the actual cost of building HDB... The actual usage and sum of the CPF pool... etc...
Another crap is that they actually dare to raise minister's salary to $2 Million a year and benchmark themselved to the top 5% of the private sector... Anyone of engineering background knows that these top 5% are outliers and should be ignored in SPC.... Yet another unknown fact is that Ministers are still given hefty pension after they retire and yet commoners need to buy compulsory annutites using our OWN money...
It is also saddening that the sons and daughters of these Ministers or MPs have an elitist mindset... Look at the WEE SUE MENG (I think I spell incorrectly) and LEE HONG YI's case... Some may argue that LHY is a gd whistleblower but I think he is just another spoilt brat thinking that just because his father and grandfather is LEE...He can do such thing...
Anyway, moving on... Look at the recent Durai's employment as CEO of monthly salary of $25,000 ... Doesn't that seems suspicious? Govt has been talking abt the Yellow Ribbon project and yet some ex-convicts are rejected from joining the public sector... and YET... someone whose's integrity is doubtful can still secure another position as CEO in a company with links to GLC...
While PAP has managed to transform Spore from 3rd world economy to 1st world Nation in a mere 40 yrs, and many great policies has been made in the past by the OLD guards, I personally feel that the current leaders has already lost their compassion to lead the people... As living cost soar and wages being suppressed, and FTs being let in to replace the aging population.... I seriously has doubt whether i will retire in my motherland in future...
Many many singaporeans have left our shore to look for greener pasture and to escape this salvery by debts... Some courageous ones stayed on and joined the oppostion.... Many still are apathetic abt the govt policies... For me, I will try to survive in my motherland but as a young Singaporean who has just started working just about a year ago and still have abundant youth and energy to shape my life, i am beginning to question the purpose of continuing to serve and contribute to a country that will eventually forsake u and does not take care of u when u become old ....