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Archive for May, 2014

Didn’t exactly thought the last few post on CPF would generate a little comments section on it. I actually was talking to one of my colleague during lunch and we drifted to the topic of CPF and how much interest it generated.

Reading the comments left on the previous post left me with some thoughts… You see, before I start on my beef with CPF… I am going to tell you something, and that is, we as a society is seriously seriously screwed. I mean it. You just have to look, just take the example of the comments left by “Tan”:

Because many will squander their payout and as a result, the number of individuals who are unable to support themselves upon retirement will increase. Therefore, the cost to the society as a whole will increase (in the form of higher taxes). We have seen this scenario played out in many other countries. Singapore is prudent in this regard. – Tan

You see, this is what I mean we are utterly screwed, congrats fellow Singaporeans, we are just so heartless as a society. You see, just because we are guarding against “imaginary” event that people will squander our payout, we decided to just withhold everyone’s money. The reason why I quote-unquote imaginary is because to date, the basis we use this excuse for the State to hold back our CPF money in the name of so we won’t squander it is just anecdotal.

Before this whole changing of rules in CPF, is there any hard evidence that of the proportion of retiree taking their money out at 55, a huge chunk of them squander it away? We have seen stories of people who have money in their CPF but they are not able to use it because either they have hit the limit or not at the age to withdraw. They are just like stranded sailors in the open sea. So much water but none to drink.

For someone who needs the cash urgently, so what if his/her CPF has a balance of $100,000? It sure make him or her feel rich like how a certain minister without portfolio said before. Btw, till this date, I still haven’t exactly figured out what does a minister without portfolio do? Anyway, it sure makes the person feel rich looking at the balance in the CPF, but what is the point if you can’t use it now?

And this is why I say we are so heartless… In our bid to prevent all these potential squandering, we decided that the needy, those in need of their money in CPF goes up as the collateral damage.

Ok, anyhow, for readers like “Tan” and “Low” (have not a single idea who they are, but never mind….) who think that some Singaporeans are ungrateful for such a wonderful pension fund called CPF which other countries doesn’t have, I will write down here what is my issue with CPF.

Trust

When CPF was first instituted, the social compact was on the premise that the people saved, and upon the age of 55, you get to take back all your savings. Look what happened now. The social compact have been broken so utterly that it doesn’t hold much weight with people anymore. You see, the issue is trust. people see CPF as a saving, or in simplistic terms, a piggy bank for their future retirement. But as the years goes by, slowly by slowly, the government unilaterally on the basis that life expectancy is increasing and the threat of squandering money decided to institute rules and increasing the draw down age. Each of this moves erode the trust people place in CPF.

We have strayed so far from the aim of CPF which is “Saving for retirement” today that you just have to ask young working adult what do they think about CPF and if they can retire on their CPF saving and be surprised at what they will tell you what they think about CPF. If I were to paraphrase some nugget of thoughts from my friends about CPF, this will be what this is:

We can forget about our CPF savings. At the rate which the government arbitrarily increase the minimum sum and the rate they push back the draw down age, I don’t want to think what is the MS required and the draw down age in 30 years time when I “retire”.

 

For all you know, if they every year suka-suka increase 4%, by the time I am of “retirement” age, the MS would be a whopping half a million and if they suka suka increase the draw down age, now the age is 62. Who knows maybe 30 years later it will be 72?!? – Anon

You see, the young people do not trust the CPF system because what we are seeing is a shifting of goal post to suit the government’s needs. Not my retirement needs. These trust erosion doesn’t happened overnight. It is the accumulation of these changes which dishearten everyone.

People can boast that CPF is the rare pension fund in the world which is so healthy and flush with cash, but the fact is other country’s pension fund understand that if they were to take such a route Singapore have taken with regards to their pension fund, they would lose the trust of the people.

We have build up the “healthy” cash level of our CPF and I am not proud of the process achieving it..

Lack of communication

Another beef I have is the lack of communication, the “we-know-best” attitude and the sue you till your pants drop approach. The manpower minister bemoan about the noise generated when people complain about the minimum sum hike even though years ago the government have announced the plan to increase it.

The problem is not about the increase. The problem is the lack of communication. The average inflation from 2003-2014 is 2.5% and do you know what is the average increase for the minimum sum? 6.2%

You see, this is the problem. Firstly, it seems like the MS hike has no pattern. This was written in CPF website:

The MS was set at $80,000 in 2003 and will be raised gradually until it reaches $120,000 (in 2003 dollars) in 2015. These amounts will be adjusted yearly for inflation.

But the fact is, it seems wildly adjusted for inflation. I mean if you tell me that the adjustment would be annual inflation rate + a fixed percentage, I would truly believed you that if is adjusted for inflation because there is a fixed target. but the fact is, the difference between the inflation rate and the MS adjustment can range from 0.9% to 5.1%.

Do you now began to see, which such wild range of numbers, how do you expect people not to be unhappy? I would think they are rational to be unhappy.

People of today is no longer the people of yesterday. People of today are more inquisitive, we ask more questions, we dig more and we do not readily accept the dogma of yesterday. Well, except for Justin Bieber lah… haha!

The fact that Singaporeans, especially older Singaporeans seems to have this notion that if the system works for them, it must also likewise work for the younger generations. But the truth is far from it. There is no need for any flashy example but just this. Ask yourself, 20 years ago as a young working adult, when you get your flat, it is expected of you to finish paying off the house in 10-15 years. Today, in 2014, you are looking at 30 years before they forced it to 25 years. Ask yourself, if the system still works, why does the loan tenure have to increase?

For this, we need not blame anyone but yourself for falling for the asset enhancement trap. When you clamour for asset enhancement, appreciating the price of your house, you are effectively getting your kids to subsidised your retirement. And you all are wondering why your kids are so unhappy?

Anyway, on a side note, did anyone notice the number of empty chair that is in Parliament when they show it on TV?

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CPF and Roy

I pity Roy, he said something that made the PM blush and now he have to pay for it.

It’s not a simple defamation of reputation or anything. That fact that the PM counsel wanted all the CPF article removed just stink of trying to make us “read the right thing”.

At the same time, the Minister of Manpower actually wrote a blog post about the benefit of CPF titled:”The Truth About Our CPF and the Minimum Sum

The first few things he said was:

CPF is your money.

There is no need for flashy charts and tables like in Roy’s blog. Just a simple answer…

If CPF is indeed my money, why can’t I use it in any way I see fit? Why must I wait for your draw down age and why must I fulfill your minimum sum rubbish before I can touch it?

If I were to put the same sum of money in a bank as a form of retirement, I could jolly well take it out anytime without the bank telling me I have to deposit a minimum amount before I can take them out!

CPF is no different from all pension scheme around the world. The only difference is CPF tries ways and means to delay you from taking your money out with all these minimum sum, draw down age and CPF LIFE. Btw, do you know your CPF LIFE can stop payout when the fund is insolvent?

You may say former Manpower Minister Gan has assured the nation in parliament that payout will continue regardless of fund solvency. Try arguing that in court when the fund is truly insolvent.

Triple A rating is nothing. Remember how those credit rating agency went to bed with those banks and rate shady financial product as triple A? The thing is that neither any of our nation fund books is out in the open for all to see and scrutinise.

I always believed using your only house as a form of retirement fund is nothing short of crazy. I mean I’m ok with using other form of financial instrument to save up, but relying on your only house for retirement is nothing short of bat shit crazy. If you have more than one house, then good for you, but one house and you’re using it for retirement?
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The fact that later part of the minister blog post is:

Furthermore, the majority of older Singaporeans own their homes. Many prefer to hold on to their homes and rely on their children for support in their retirement years if their own savings are inadequate.

The question to ask why aren’t they monetising their flat to fund their own retirement?

The minister can go on and on about CPF and how good it is, but that fact that so much secrecy is shrouded in CPF, GIC and TH just allowed people like Roy to fill it in with their own interpretation.

Like the recent 4.7% hike, except for the short statement of keeping with inflation, there is no other explanation as to how the number is derived.

So you can’t expect people to just listen to what you say when so much is shrouded in secrecy..
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The fact that there is so much secrecy just naturally makes people think that there is something to hide. #justsaying #notdefaminganybody #kopitiamtalk

And I wouldn’t exactly trust the government to manage my money. Isn’t this the government that:

1. Overspend on YOG
2. Build insufficient HDB flats to accommodate the influx of foreigners
3. Build insufficient healthcare for the above same reasons

The list goes on and on. And you expect me to trust the government?
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Spoken like a true blue elite.

The girl was asking a few days back what I think of her friend who is very active in organising social event to make Singapore better. Think along the make Singapore more gracious and stuff like that.

And I told her while her friend had good intentions, this whole campaign to make Singapore a better place is not going to work. One reason? People like that true blue elite.

And to think he used to be in the public transport council. There are actually Singaporeans who believe that the public transport council will act in the public’s interest.
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Nothing is guaranteed

Linking from the previous post, I always think it’s so strange on the faith of Singaporeans believing in the word guarantee.

Like from my recent adventure of study on if we can afford a house here, I realised a lot of Singaporeans always say this to me when they found out I was considering getting a flat:

Get a flat, the price confirm go up one.

The government will guarantee flat price will go up.

I mean to this date, reading HDB, CPF website in the midst of my research never did I see a concrete statement that the government will ensure price appreciation.

So the level of faith I think most Singaporean have is bewildering high. You actually think that the implicit guarantee will hold true all the time?

You do understand your housing price increase for the past few years is due to an influx of immigrants coupled with a very limited land space?

Can you guarantee that the amount of people coming in will increase over the years?

Can you guarantee that the government will reclaim enough land to meet future development? If we max out the area for reclamation, what are we going to do? Invade other country?

You do understand for those with one house, your house though expensive on paper, actually means nothing to you until you sell it? And when you sell it, means you need to buy a flat that is also overpriced?

I would make it a point to ask the next guy who tell me about the housing price guarantee this:
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In interest of the guarantee over such long duration, explain this to me please…

Transport minister said this in 2011

This is what happened in 2014

They can’t even keep their words for 3 years and you expect them to keep it long term?

Please…

But none the less, regardless of the faith you have.. Enjoy your weekends!

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Are we happy?

We are in the month of May and how time flies. It is pretty much close to half the year of 2014.

A few things got me thinking the past few days. Are we truly happy in this place or is there more to life than slogging your life away for nothing?

While most of my peers at my age now will be talking about how they are balloting for a BTO and getting married at so-and-so hotel. I guess I am bucking the trend to it.

Actually, the girl and I have talked and considered buying a flat. We talked, we calculated, we hew and haw and we realised that we are being priced out of the housing market in our own country. I am talking about living a life, not being saddled with a 30 year loan.

Singaporeans are still living in the illusionary bliss and progressively screwing the next generation for their selfishness. I am talking about the Asset Enhancement Program. The half-baked idea of a Ponzi scheme. What do you want to enhance if you only got one flat? The ruling party baited you with this bullshit half-baked idea and everyone just eat it hook, line, sinker.

I don’t understand how older Singaporeans can bitch about how their kids will not afford housing at their price of affordability 20 years ago. You need not look far, you just need to look into a mirror to find out who is responsible for it. In your pursuit of the good life, you all decided that the future generation can go shaft it in their asses while you enjoy your life of luxury.

And when younger Singaporean decided that it is not the kind of life we wanted, we are label; lazy, no drive, no motivation and so on. It is not that we’re lazy or that we have no drive. It is that we realised we are getting screwed by the system with the help of our parents and their generation. We are no longer interested in keeping a failure system like CPF alive.

And we are not lazy or not motivated. Your technology is developed by young 20-30s. Exactly those people you label lazy and unmotivated.

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The elites speaks yet again.

NEA Dy Chairman Scold Singapore For Poor Upbringing

I mean why is everyone so surprised that such thoughts have been articulated by him? He is just brave enough to say what he really think.

The usual comments of how we are flooded with foreigner and other foreign trash posting is way too overused people. Look deeper. As much as I bemoan the quality of some foreigners in Singapore, not all reason is attributable to them.
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Indeed we have poor upbringing. Because we are brought up with the wrong values to begin with. We are looking at generations brought up with the 5C(Cash, Credit card, Car, Condominium, Country Club) concept. If you’re in your late twenty to early forty. You are the product of the 5C values regardless of you like it or not.

Remember those serial shows which show a mark of success as one having all the 5C. Those TCS-era shows.

One more upbringing ingrained in us; remember how your mom/dad would point to the cleaner(who is a Bangladeshi national) when you’re at the market for breakfast and say:

Boy ar, if you don’t study hard enough you will be like him no future

This is our upbringing. The worship of money, material and the glorification of certain profession and the trashing of others. So how can you blame people if everyone do not return their tray as poor upbringing. The people are doing what is ingrained in them. Money above all else and seeing people in unskilled profession as not worthy.
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