CPF Minimum Sum to hit more than $500K in 20 yrs’ time? Decide in 2015/2016 GE!

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An honorable member of the Coffee Shop Has Just Posted the Following:

CPF Minimum Sum to hit more than $500K in 20 yrs’ time?

May 9th, 2014 | Author: Editorial




Yesterday (8 May), the government announced that the CPF Minimum Sum will be
raised to $155,000 from 1 July 2014, from the current $148,000. The change will
apply to CPF members who turn 55 between 1 July 2014 and 30 June 2015 (‘CPF
Minimum Sum to be raised to $155,000 on 1 July‘).

CPF said this is to “cater to Singaporeans’ rising expectations of what is
considered a basic standard of living in retirement”.

“Setting aside more retirement savings means higher payouts when members
retire,” it added.

Looking at the past data from CPF, it is observed that the Minimum Sum has
increased by some 94% to $155,000 since 2003. On average, it has been increasing
by 6.2% a year:



On TRE, readers were generally angry with the government on hearing the news,
except for one reader, Roger Zhang:

Veteran:
May 8, 2014 at 10:58 pm (Quote)
This is a
sickening statement issued by CPF annually. It reminds those who are 55 that
their money will be locked up and payable when they feel it is able and by
miserable monthly instalments.
Cynical Sinkie:
May 8, 2014 at 11:03 pm
(Quote)
Why is only the CPF rate adjusted for inflation. Then what about
the interest rate and our salary?

D:
May 8, 2014 at 11:12 pm (Quote)
This govt
really makes me sick to the core!!! Whatever happens, my family and I will give
our fullest support to any opposition.

A harsh Reminder:
May 8, 2014 at 11:44 pm
(Quote)
For any ordinary working person, by the time you retire at age
55, you have absolutely NOTHING left in your CPF to take out. You are going to
spend the rest of your life after 55, collecting carton boxes.

50cents:
May 9, 2014 at 1:32 am (Quote)
Here we go
again. Suka suka one like cowboy town oui! How come no one speak out about this
in Parliament? Keep milking and shearing Singaporeans until we dried out is it?
We’ll never see our $$$! This kind of daylight robbery must stop! We must do
something fast or we’ll be drained out even faster….

True Blue Sinkie:
May 9, 2014 at 2:49 am (Quote)
I
want my CPF money returned to me, I did not consent to CPF to manage my money
and lock it up till eternity.
Some brought up the point that at the current rate of increase, the minimum
sum will reach a ridiculously high sum for the present younger working
Singaporeans when they reach 55. In fact, at the current average rate of
increase of 6.2% a year, the minimum sum will hit more than $500,000 in 20
years’ time!

TRE readers said:


Gone with the Wind:
May 8, 2014 at 11:15 pm
(Quote)
If you are 18 years old and a good 37 years to reach 55 years
old. What will the CPF Minimum Sum be? If you are lucky 600K. Not too late to
vote them out.

yangoon:
May 8, 2014 at 11:38 pm (Quote)
In other
words, anyone below 30 years of age at this moment, will be paying for his or
her own funeral. It will be about $300,000+ and the salary can never catch up.
They will ensure that. If you die before that, too bad. And your sons will have
to perform NS too… While this is happening, the FWs will worked for the next 10
to 20 years and retire in their own home land as comfortably and many will be
millionaires in their own right…

BuyMeBakKutTeh:
May 8, 2014 at 11:07 pm
(Quote)
Every year increase by $7000. If you are 21 now, your min sum
will be $393,000. And if you are 20 now, it will be $400,000. So young voters….
You want this? If not we need change! Vote very very wisely in the coming
Election.
Reader Chris K raised a very pertinent point, asking why the government
didn’t raise the CPF interest rates:


More retirement savings can be generated by higher CPF interest rates rather
than keep increasing the Minimum Sum. If CPF deems it necessary to increase the
Minimum Sum by 4.7% this year – this is a tacit admission that price levels have
gone up, impacting retirement spending. Then why is CPF paying just 2.5% OA and
4% RA. All CPF rates should be at least 4.7% because CPF is telling us that is
the inflation rate applicable to future retirement spending.

On the one hand, the govt tell us that we need to set aside more for
retirement due to inflation – on the other hand, they f**ked us with interest
rates below what they tacitly admitted is the real inflation. Another
schizophrenic piece of policy implementation and they expect us to be so dumb
that we can’t see through their game.
Prominent financial blogger Leong Sze Hian also raised questions on the
Minimum Sum increase (‘CPF
& Medisave Minimum Sums to go up to $198,500?‘). He asked, “Since for
the whole of 2013, CPI-All Items inflation averaged 2.4 per cent, sharply lower
than the 4.6 per cent in 2012 – Why is it that the Minimum Sum is being
increased by 4.7%?”

“Similarly, why is the Medisave Minimum Sum being increased by a whopping
7.4%, from $40,500 to $43,500?” he added.

Mr Leong further questioned how many Singaporeans who reach age 55 will have
$198,500 (i.e, $155,000 + $43,500) in their CPF. He figured about 1 in 8 will
qualify.

Mr Leong revealed that the original mandate to increase the Minimum Sum to
$120,000 in 2003 dollars was for the Minimum Sum only.

“Now, with the inclusion of the Medisave Minimum Sum – the total sum of
$198,500 to be retained at age 55 may already far exceed it,” he said.
“Shouldn’t such an important issue as continuing to increase it be debated in
Parliament?”

Reader, “Money Back In 2016″, offered a guaranteed solution for Singaporeans
to get back all their CPF money. He said:

Fellow senior citizens, you can get all your CPF money back in 2016 guaranteed.
Just do the right thing at the ballot box.


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