Thursday, May 29, 2014

Talking Point on CPF - a waste of time

This week Talking Point over at CNA discussed the current hot topic of CPF.  Watching it is a waste of time. The selected speakers all agreed that the current CPF interest rate is good and reasonable as CPF is risk free.  Makes one wonder if this is a brain washing session or a talking cock session.

If our neighbour Malaysia can give so much higher return and their fund is not even among the top 10 large funds. GIC and Temasek are in the top 10 list.

Even for those who meet the minimum sum requirement in their retirement account when they reached 55, the amount of payout in CPF Life when they are 65 is around $1,200. With inflation, will this amount be sufficient in 20 years time? Worse if you have homemaker wife, elderly parents or children still needing your support. That is why they keep telling us not to retire and work and work.

This is clear evident CPF has failed big time.  It is suppose to see us through retirement, and now we cannot retire as money is not enough.

One of the speakers, a Prof from NTU Economic Division is telling us that silly story again that if they let us withdraw it a 55, folks will spend it at one go and become tax payers' burden.  Please lah, this story don't work anymore. Where is the statistic to show there are so many foolish people in S'pore. No wonder our education system cannot product talent and we have to import them by tonnage from overseas. This is that kind of lecturer we have in our institute of higher learning.  He cannot even articulate and express himself well.

One of the suggestions made during the discuss is to have different rate of return for different risk CPF members are willing to take.  As it is, CPF policies are so messy and complicated already, we should simplify it and not make it messier by creating more accounts.

The very fact that it has gotten so complicated suggest it is not working and they keep trying to patch it up.  So we have :
1) ordinary a/c
2) medisave a/c (medishield, eldershield and coming medishield life link to it)
3) special a/c
4) retirement a/c (CPF life link to it)

So how many more a/c, shield or life we need to create before we can finally retire ?

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