TIF: CPF is a complicated matter. While it appears that the govt is unfair to implement measurements to prevent elder Singaporeans from ‘retiring’, here are some of thoughts about the issue.
#1: If a person starts working from 25 to 60 years old and still have difficulty to save enough retirement funds, chances are the person is unable to use the CPF monies wisely.
Putting in simple mathematical terms, if the person saves at least $100/month, that would be at least $42k (excluding bank interest). If a person is finding it difficult to even save $100/month, I would hope that the govt would hold on to his/her monies more tightly for more urgent matters (i.e. medical fees) before they splurge away.
#2: If a person/family has difficulties paying off the HDB loans after 30 years and has his/her cpf wiped out, the person/family has bought a hdb that is too large for the family to afford.
I do not know why but many of my friends jump into 4 or 5 room hdb for their first apartments and found themselves in financial stress as they didn’t budget their finances properly. Honestly speaking, I find that they are too ambitious and overconfident with their cashflow. In this case, they are better off with a 3rm or 2rm HDB first before upgrading to something better.
#3: Many Singaporeans are inadequately protected from emergencies, be it insurance or other matters. Medisave/Medishield no matter how little it helped, it still helped our parents a great deal especially since they aren’t as fortunate to be able to be protected for more illnesses from when they were young and healthy.
If not for these implementations in the CPF, we will see more broken families that are burdened by the heavy medical charges of major illnesses. I’m extremely thankful that my dad who was diagnosed with cancer had Medisave few years ago when I was still schooling. If it were for him to save himself rather than CPF, I wouldn’t have graduated.
I’m not saying that the Opposition are wrong, my opinion is that they have myopic perspectives. CPF is forcefully implemented because humans are imperfect and most of us lack discipline. Even the most disciplined ones can get ourselves cheated by bad people, lose our monies through bad emotions or lend monies that never came back.
Thank you Tif for this letter.
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