To teacher friends out there... Hang in there! December school holidays only 5 months away. Hope springs eternal! To parents out there... Hello! MOE and school teachers not surrogate parents OK?
I suspect that's why Singapore has switched to full day schools - both parents working and living apart from gandparents - throw the child to schools...
It just happens you finally read the CPF website in detail ;)
No one talks about it because most of us are with the new CPF Life scheme :)
If you or your wife is under the old RSS scheme, big daddy is merely saying if you don't do anything, it will "default" the CPF payouts at age 70 from 2018 if you DON"T DO ANYTHING.
But if you want to start your CPF payouts from your payout eligibility age (PEA) - depending on which year you were born as you per your copy paste - you can still do so!
"You can always apply to start your monthly payouts anytime after your payout eligibility age."
So mai tu liao if you don't want to wait till age 70 to get your CPF payouts!!!
This option is also available to those of us who are on the new CPF Life scheme, we can decide whether to start collecting our CPF Life payouts from age 65 to 70.
The longer we delay, of course the more we'll get since our CPF money will earn more interests mah!
I'll decide at age 65 :)
If good health, I may choose age 70.
If I don't think I can reach age 90 like lao lee or nathan, then I'll opt for age 65 so I can start visiting Batam earlier!
But you are right. The way big daddy "defaults" RSS scheme to age 70 is a "clue" to what they will do to us on CPF Life scheme.
It's for our own good!
So maybe at age 65 I may not have the "choice" like they say I have now.
CPF is geared towards the lower middle-class and below - those who need it the most during their retirements; but the payouts never enough...
Those who are upper middle-class and above, CPF is turning money away as big daddy needs to support our financial industry and grow our wealth management centre status mah!
You think why our CPF was liberalised for investments?
Good intentions turned bad as most CPF investors lost money :(
Defiinitely not part of their plans! Now lagi must move the goal posts with CPF Life so that those who die "young" can subsidise those who seem to live forever...
Its our fault! When CPF was devised, we were "supposed" to retire at 55 and die around 65...
My bad.
A simple rule of thumb:
If CPF is less than 25% of our networth, then we are in good financial shape ;)
We don't have to rely on big daddy.
If CPF is more than 50% of our networth, then whatever big daddy says or do will affect us since we are shackled to their "good intentions".
At age 55, I would like to withdraw as much CPF OUT as possible, never mind the "extra" interests as carrot. I don't bite.
This way, at age 65 (if I still have the option to choose), the decision whether to start CPF payouts at age 65 or 70 would be like choosing vanilla or strawberry flavoured ice-cream - it doesn't matter.
If I'm not depending on the CPF payouts, that's wine, woman, and song money ;)
Ha ha! You missed what's not said between the lines ;)
You have a child so I'll use a more concrete example.
If your child grows up to be "successful" financially speaking - either he have his own business or be a corporate high flyer. And due to the cap in CPF contributions, his wealth OUTSIDE of CPF must be greater, no?
Now if one's CPF is more than 50% of our networth, that means he had a middle income career, probably not financially savvy since he knows only how to SAVE by voluntarily contributing to CPF, and quite risk adverse.
Again nothing wrong with savings and playing it safe. If this is who you are :)
But if one is savvy with money - be it properties, stocks, or business - then he wouldn't want to voluntarily lock up his funds in CPF when he can multiply it more outside, right?
Its a bit like Life insurance. Those who are financially savvy will buy term and invest the rest. Those who neither have the time nor competence can buy Wholelife or Endowment plans instead.
Differnt strokes for different folks :)
For a parent to voluntarily contribute to his child's CPF, that means the parent does not have high expectations for his child...
Do we want our child to be financially savvy?
Or do we coddle our child from young so they don't have to do any thinking for themselves?
Look! You'll be a millionaire by age 55 if you let your CPF SA compound by 55 years! Daddy gave you a head start!
(A million in 55 years time may only buy you a HDB 2 room flat... How much was landed properties in the 70s? My new 3 room HDB SERs replacement flat is already $400K today...)
If one is savvy using CPF to invest in properties or stocks under CPIS, one can have a lot of money extra even after paying the accrued CPF interests.
That meant one can withdraw these excess CPF winnings at age 55 as it already exceeded the minimum sum several times over - hence I say CPF less than 25% of our networth is a good thing :)
Even if we don't withdraw and "park" at CPF to earn the supposedly "risk free" intersts after age 55, we can withdraw this CPF money out anytime.
This I don't count as "CPF money". Big daddy got choice will also don't want such money... They no choice have to keep it if we don't withdraw.
It makes them look bad. They pay 4-5 % and here some idiot individual is able to multply his CPF funds several times over!!! Come to think of it, makes Temasek and GIC look bad too!
I would think a financially savvy person would take as much money out of CPF at age 55.
If the rich wouldn't want to park all their money at a SINGLE bank (remember Cyprus, Greece, and other failed banks in Europe?), why would anyone want to chance Policy Risks by putting most of their networth with a single institution as in CPF? What if big daddy freeze their accounts due to politics?
And the irony? Singapore is an offshore safe haven for billionaires overseas to park their money here! Safe from their prying home governments :)
Some people like to compare CPF with bond-like returns. If a 30 year bond does not pay in FULL in 30 years time, then its a default!
To those older CPF members who were "promised" they can get ALL their CPF money in FULL at age 55, our CPF has been in technical "default" for quite sometime liao...
Hi SMOL
ReplyDeleteFreedom lai liao... hahaha
B,
DeleteLOL!
I suspect that's why Singapore has switched to full day schools - both parents working and living apart from gandparents - throw the child to schools...
Problem solved :)
I am still on minimum sum scheme. How it affect me?
ReplyDeletetemperament,
ReplyDeleteIts not something "NEW" lah!
It just happens you finally read the CPF website in detail ;)
No one talks about it because most of us are with the new CPF Life scheme :)
If you or your wife is under the old RSS scheme, big daddy is merely saying if you don't do anything, it will "default" the CPF payouts at age 70 from 2018 if you DON"T DO ANYTHING.
But if you want to start your CPF payouts from your payout eligibility age (PEA) - depending on which year you were born as you per your copy paste - you can still do so!
"You can always apply to start your monthly payouts anytime after your payout eligibility age."
So mai tu liao if you don't want to wait till age 70 to get your CPF payouts!!!
This option is also available to those of us who are on the new CPF Life scheme, we can decide whether to start collecting our CPF Life payouts from age 65 to 70.
The longer we delay, of course the more we'll get since our CPF money will earn more interests mah!
I'll decide at age 65 :)
If good health, I may choose age 70.
If I don't think I can reach age 90 like lao lee or nathan, then I'll opt for age 65 so I can start visiting Batam earlier!
But you are right. The way big daddy "defaults" RSS scheme to age 70 is a "clue" to what they will do to us on CPF Life scheme.
It's for our own good!
So maybe at age 65 I may not have the "choice" like they say I have now.
15 years away is a long time!
CW,
ReplyDeleteSee lah!
Must stop people calling me "uncle".
Now even temperament put me and you as the SAME cohort...
^%$#!!#%&*^$!!@@
LOL!
temperament,
ReplyDeleteCPF is geared towards the lower middle-class and below - those who need it the most during their retirements; but the payouts never enough...
Those who are upper middle-class and above, CPF is turning money away as big daddy needs to support our financial industry and grow our wealth management centre status mah!
You think why our CPF was liberalised for investments?
Good intentions turned bad as most CPF investors lost money :(
Defiinitely not part of their plans! Now lagi must move the goal posts with CPF Life so that those who die "young" can subsidise those who seem to live forever...
Its our fault! When CPF was devised, we were "supposed" to retire at 55 and die around 65...
My bad.
A simple rule of thumb:
If CPF is less than 25% of our networth, then we are in good financial shape ;)
We don't have to rely on big daddy.
If CPF is more than 50% of our networth, then whatever big daddy says or do will affect us since we are shackled to their "good intentions".
At age 55, I would like to withdraw as much CPF OUT as possible, never mind the "extra" interests as carrot. I don't bite.
This way, at age 65 (if I still have the option to choose), the decision whether to start CPF payouts at age 65 or 70 would be like choosing vanilla or strawberry flavoured ice-cream - it doesn't matter.
If I'm not depending on the CPF payouts, that's wine, woman, and song money ;)
temperament,
ReplyDeleteHa ha! You missed what's not said between the lines ;)
You have a child so I'll use a more concrete example.
If your child grows up to be "successful" financially speaking - either he have his own business or be a corporate high flyer. And due to the cap in CPF contributions, his wealth OUTSIDE of CPF must be greater, no?
Now if one's CPF is more than 50% of our networth, that means he had a middle income career, probably not financially savvy since he knows only how to SAVE by voluntarily contributing to CPF, and quite risk adverse.
Again nothing wrong with savings and playing it safe. If this is who you are :)
But if one is savvy with money - be it properties, stocks, or business - then he wouldn't want to voluntarily lock up his funds in CPF when he can multiply it more outside, right?
Its a bit like Life insurance. Those who are financially savvy will buy term and invest the rest. Those who neither have the time nor competence can buy Wholelife or Endowment plans instead.
Differnt strokes for different folks :)
For a parent to voluntarily contribute to his child's CPF, that means the parent does not have high expectations for his child...
Do we want our child to be financially savvy?
Or do we coddle our child from young so they don't have to do any thinking for themselves?
Look! You'll be a millionaire by age 55 if you let your CPF SA compound by 55 years! Daddy gave you a head start!
(A million in 55 years time may only buy you a HDB 2 room flat... How much was landed properties in the 70s? My new 3 room HDB SERs replacement flat is already $400K today...)
temperament,
ReplyDeleteYes of course!
If one is savvy using CPF to invest in properties or stocks under CPIS, one can have a lot of money extra even after paying the accrued CPF interests.
That meant one can withdraw these excess CPF winnings at age 55 as it already exceeded the minimum sum several times over - hence I say CPF less than 25% of our networth is a good thing :)
Even if we don't withdraw and "park" at CPF to earn the supposedly "risk free" intersts after age 55, we can withdraw this CPF money out anytime.
This I don't count as "CPF money". Big daddy got choice will also don't want such money... They no choice have to keep it if we don't withdraw.
It makes them look bad. They pay 4-5 % and here some idiot individual is able to multply his CPF funds several times over!!! Come to think of it, makes Temasek and GIC look bad too!
I would think a financially savvy person would take as much money out of CPF at age 55.
If the rich wouldn't want to park all their money at a SINGLE bank (remember Cyprus, Greece, and other failed banks in Europe?), why would anyone want to chance Policy Risks by putting most of their networth with a single institution as in CPF? What if big daddy freeze their accounts due to politics?
And the irony? Singapore is an offshore safe haven for billionaires overseas to park their money here! Safe from their prying home governments :)
Some people like to compare CPF with bond-like returns. If a 30 year bond does not pay in FULL in 30 years time, then its a default!
To those older CPF members who were "promised" they can get ALL their CPF money in FULL at age 55, our CPF has been in technical "default" for quite sometime liao...
;)
temperament,
ReplyDeleteYou and your wife seem to do the opposite ;)
She does one thing, you do another - a perfect hedge!
LOL!
Those of us who worked or studied overseas would have experience with an overseas bank account.
Heck! Just count the number of Singaporean with overseas investment properties!
Anyway, everything is just an illusion... When we go, we bring nothing with us.
Empty handed I come; empty handed I go.
Death is the great equaliser.