CPF minimum sum raised to $106,000 from July
-
CPF minimum sum raised to $106,000 from July
And going to raise to $120 by 2013. How come keep increasing but never say why?
-
With so many bad investment decisions, they want to hold back your money to prevent excessive inflation.
Ultimately most Singaporeans won't get to see their money in his lifetime.
-
My advice to my fellow singaporeans is dont go to school so that you dont have to work. If you dont work, you wont face the problem with CPF.
-
Hello Singaporeans!
I find the sg cpf system interesting. Oh, I am living overseas by the way, having lived in singapore during the early part of my childhood. But I am not a singaporean.
I seek to confirm my understanding of the system is correct.
1. CPF min sum is about $ 1 0 6, 0 0 0. So many singaporeans and PRs use this money to pay for the flat they lease from their gahmen (I learnt this word from sgf). So, this means the amount they cannot withdraw. Hope i am right. Now, based on my friend's situation in singapore, he revealed to me, a average grad working in sg can save about $ 1 0 6 0 0 0 after working for say 10 plus years.
Also, average or most singaporeans live in a HDB flat. For a basic 2 or 3 bedroom unit, he will spend all of this $ 1 0 6 0 0 0 from the CPF. In addition, because such basic homes are priced incredibly high (to foreigners), at say 200 to 400 K, on average, they will either use their bank savings or loan from the bank for the remainder of about 100 to 300 K.
2. Having bought a unit, this leaves the man with basically NIL or 0 as in nothing left in his normal account in his CPF. So, what to do to meet min sum of $ 1 0 6 0 0 0 ? He works. Assume he starts work after graduation at say 25 (for ease of calculation). Add 10 years to his age to reach the point in his life when he accumulates his CPF to $ 1 0 6 0 0 0 . This gives him an age of 35. So, at 35, he has zero as in 0 left in his cpf. He does not meet the min requirement of $ 1 0 6 0 0 0. So, he continues to work. For simplicity, lets assume by age 35, his salary 'matured' somewhat as in 'stable income' as in his pay 'stablized' hovering at around the same for the next 5 years and then considering structural unemployment somewhere in between the 5 years or the next 5, or pay cuts or freeze or inflation of cost of living, he is able to save in his cpf another $ 1 0 6 0 0 0 after this 10 years, bringing him to age of 45.
3. At age of 45, he finally meets the min sum. So, how about for retirement, how much can he withdraw? Am I right to say , at this point in time at age 45, he has ZERO as in 0 cpf to withdraw due to the min sum of $ 10 6 0 0 0 ? If so, it means after working for 20 years, this man has zero left in his CPF for withdrawal when he eventually reaches the age of retirement at say 65 ?
4. If so, to have enough money to withdraw and support during his retirement years, this man needs to continue putting money into his cpf as he has ZERO as in 0 left for withdrawal? If so, at age 45, to keep a job may be a little difficult. Will the cpf rate have changed then? Would employer contributions have changed then? Would his pay be affected or even lowered due to foreign labour competition?
5. So, lets say he starts to save for his retirement withdrawal starting at a young age of 45. Lets say he works for another 10 years. At age 55 he finally saves another $ 1 0 6 0 0 0 which he can withdraw at after retirement? Is this correct ? Lets say at age 65, he retires and this means 2 x 1 0 6 0 0 0 in the CPF for withdrawal.
6. Is 212000 enough for retirement (and last till 85) considering his medical bill could be at his all time high and medical charges should have climaxed by then? How about cost of living? An we are assuming he has a job and able to maintain that rate of cpf contribution from age 25 till 65. He would have spent his bank savings on his childrens education if his child is to succeed in singapore. For 1 child, I think he surely will need to spend all of his savings of say 200 000 in his piggy bank to bring up his child and support him to university.
Is my above understanding fair understanding of the singapore system?
If so, wow, you guys are so lucky that the min sum have increased.
I cannot say unlucky right? As it would mean the cpf is bad for you.
So, cheers to you!
-
If you are interested to know more about Singapore CPF, you should visit www.cpf.gov.sg because the website provide more comprehensive information that what you have written.
Maybe you might want to check out this girl call MAY, I think she can help you.
https://www.cpf.gov.sg/cpf_trans/ssl/rnr/default.asp
Guten Tag!!
-
Guten Tag!
Wie geht's es Ihnen? Es geht mir gut!
Argh... Mein Deutsch ist sehr schlecht... Ich habe viel vergessen... Schade :(
Jetzt bin ich müde... Gute Nacht!
-
Delusional.
These days some folks have the habit of talking to themselves, it's an early sign of schizophrenia.
-
Originally posted by £Îª€Ú°:
My advice to my fellow singaporeans is dont go to school so that you dont have to work. If you dont work, you wont face the problem with CPF.
Don't go to school mean don't have to work? What do you mean? In Singapore, you think if don't work, the gov will feed you? -
Originally posted by eagle:
Guten Tag!
Wie geht's es Ihnen? Es geht mir gut!
Argh... Mein Deutsch ist sehr schlecht... Ich habe viel vergessen... Schade :(
Jetzt bin ich müde... Gute Nacht!
hehehe -
Originally posted by 333225520:
Don't go to school mean don't have to work? What do you mean? In Singapore, you think if don't work, the gov will feed you?ignore him. he never think before he talk.
-
Originally posted by maurizio13:
With so many bad investment decisions, they want to hold back your money to prevent excessive inflation.
Ultimately most Singaporeans won't get to see their money in his lifetime.
surrender your citizenship? u can cash it out 100% -
... soon, some day, the our 'government' will be brazen and atrocious enough, to impose FINES or PRISON TERM for not meeting this 'Minimum Sum' in CPF...
... don't be surprised if this happens...
-
Originally posted by f4a:
surrender your citizenship? u can cash it out 100%
Most people will not migrate :1. simply will not due to psychology.
2. simply could not due to qualification , and I do not mean just education level.
But there is an alternative solution I can think of.
Due to self-preservation mentality burned-in in me, I dare not say it out loud.
Also, must not spoil market. ;)
-
Originally posted by f4a:
surrender your citizenship? u can cash it out 100%
if you can get me Australian or New Zealand citizenship, I don't mind, seriously. -
guten abend!
ich bin sehr hubsch!
-
Originally posted by Hello Kitty:
guten abend!
ich bin sehr hubsch!
wirklich?
-
I dont have hard evidence or facts here just assuming, maybe garmen losing money in investments and need more capital to brush up their coffers? Like the US banks like that. Aging population, more people are withdrawing or will be withdrawing in the future. Later not enough money to return to citizens how?
So GIC, can you please release your past year's financial statements to the public.
-
Originally posted by Evangel:
I dont have hard evidence or facts here just assuming, maybe garmen losing money in investments and need more capital to brush up their coffers? Like the US banks like that. Aging population, more people are withdrawing or will be withdrawing in the future. Later not enough money to return to citizens how?
So GIC, can you please release your past year's financial statements to the public.
they can issue gahmen bond at low low rate still got ppl buy... but ofcourse... 2,5rate, who will buy?
-
I searched on the net, interesting comment.
-
Bye Bye CPF savings... see you in my next life.
The Big Truth about CPF Annuity
LKY- We don't want to see you in 20 years time at the meet the people session and complaint that you got no money to eat.
Then we will probably give your food stamp...
That is the grant scheme of things.
In 2001, PAP knew that more than 50% of people don't even have the mimium sum when they reach 55. They are worried.
They stop people from taking out the money and at same time increase the minimum sum so that chances of taking out is almost zero at 55.(for the poor)
They increase the minimun sum to $120,00 by 2013 and they knew that again more thant 50% cannot match that sum at 55.
2008 Annity scheme, the objective is that most people who live until 85 can have something $600.... and got no reason to see the government for food stampo
So that how it work.
To earn interest on your CPF, someone have to borrow the CPF money and invest something that is at least higher than 2.5%.
That someone is GIC or various government agencies.
The CPF board buy government bond and earn the interest in order to pay you.
So, Dr Ng at first said No and then said the relationship is not simple. The truth is Yes.
Now how do earn interest with the pool of money for the annuity.
the trick is the same. THe pool has to be big enought, so that any big distortion payout along the way can be smoothen out. That's why it must be complusory!
The money will be invested on the government bond again and earn a low interest of 3%. by the way there is no mention of rate of return in the CPF
annuity schemes.
the CPF annuity is very clear give you a choice to choose, at 65, 70 75, 80, 85, 90
with payback or no payback when you goes to heaven!
You have to choose at 55, but you cannot get it until 65 earliest. So that 10 good years of your money is pooling inside to fun the payout. Ha ha 10 years, go and buy the savest bond in singapoe or dividend yield from good company SPH, you get at least 3 to 5%. Go and count yourself, you lost at least 50% of capital appreication on your money compounded from premium
So how do you choose?
Now, let say you are OK fellow, work 30 years in your life middle income, at 55 got 135K in the minimum sum.
Hint from LKY
1. check you family history, your anuty, uncle, how long they live, die of what illness?
2. Estimate what is your likely hood of your Life expectancy. If it is below 65
Choose 90, minimum premium committed is (4%)annuity and the rest return to your family if you die before 65.
But you contribute 10 good years of money to the pool for investment.
2. If you expect to leave until 80, Choose 65 and get your money fast but you pay a high premium.
3. If you father/mother, uncle and auntie are at least 90 years old and you live a healthy lifestyle, choose 65 and pay maximum premium ,get maximum payout from annuity account every month.
4. From 85 to 90, not many people are sane?
Finally, if you follow what Dr NG said, well I have not think about it, you know most Singaporean are lazy, I will leave it at default 80, ha ha good luck to you.
Dr Ng is rich, Cancer surgeon before and minister for at least another 10 years. He don't need this annuity.
The truth is most people die at 75 to 85. you get nothing before 80, you are not only lazy but also stupid!
So the Default is 80, ha ha for the lazy and stupid.
If what the newspaper said that the scheme is easy to understand and it only takes 3 to 5 minutes to explain to the layman(security guard, delivery man) than I am sure this people will choose 80 default.
CPF hopes many people choose 80 because that is the best outcome.
why, A big pool of money to invest for next 25 years and then the majority of the payee will die at that age. No refund is even better.
Whan happen when everybody choose 90, no refund. The is scheme will work but the people can go and see the MP when their money in the retirement account is depleted.
MP will give you food stamp! from 85 to 90 years old.
What if everyone choose 65, it is a big responsibilites for the CPF, if everyone live until 90. (that will never happen!)
So my prediction for the next ten years
GST will raise to 10% as they attempt to reduce the personal income and company tax down.
ERP will be paid as you move the car from your house.
Mimimum Sum will be raised along with inflation and again >50% can never make it.
The govenment will raise the retirement age to 65 or even 70 to make sure as long you work and don't need to give food stamp.
The Mean Test by Mr Khaw will be refined and expanded to make it even More Mean?
Guess what all this they will do it after election and before election a lot of goodies......
Collect $2 return $1 and collect again another $2 and return $1......
Bao Chiak---Dr NG said about the CPF annuity scheme. ya ya where got bao Chiak
Posted by limcy | February 25, 2008 12:44 AM