Tuesday, October 26, 2010

CPF Life - Make it attractive

My student in SMU asked me, "Prof Tan, I find the CPF Life to be very complicated. It is so difficult to decide on choosing the four options, as they seem to work differently, with the DDA etc."

I agree with her views. I also find it to be difficult. I sent the attached article to the Straits Times two months ago, but they declined to publish it. In this article, I suggested how the Government can get out of the current mess that they have created.


DareToAct said...

200 million is half what we paid to host YOG. Surely having thousands of happy reitrees is more important? Or not?

yujuan said...

The third option to have the most payment to holder, but a smaller component given to beneficiaries
upon death, is the best option of the four.
It is quite easy to decide, think about yourself first, but leave balance to your children, or else if you choosed option four, should you die early, balance would be forfeited by CPF Board. Keep in mind, your children would not thank you if you leave more money to them, there is a chance they would blow everything at the casinos, esay come, easy go.
But people must decide whether they want to have their money tied down by CPF for decades should they by the grace of God live to age 100, otherwise choose the fifth
option, get money out fast till it runs out, simply said, do not join the annuity Scheme. The latter applies to retirees of age 55 now,
in a few years time, joining the Annuity will be made legally mandatory by our Govt.

Anonymous said...

Whenever the government is vague on certain thing normally it is trying to hide something from the public. In this CPF Life scheme it is stated vaguely that should the interest drops the payout may drop too giving the retiree a reduced amount to rely on in their old age. The government is unable to ascertain the payout will be constant throughout the remaining lifespan of the retirees.

Concerned said...

Most people who do not wish to join or still undecided is the behest question. At least the govt should give a formula on how the behest amount should be calculated and given to the beneificiaries should the CPF member dies before the age of 84. For the first three option, CPF Board just state should the member dies early, a certain amount is behest to the beneficiary. What amount? Is is very difficult to give a formula? This creates a lot of uncertainities in the minds of the CPF member, the result of which is that a lot of CPF members are undecided inspite of the bonus dangled for joining.

CONTACT said...

As a newbie to the working class myself I found the CPF to have a mind of its own in many ways. Simply stated I have no clue to what it encompasses but believe it will come to save us (medically, in buying property)in the future.

However, thankfully my company strongly believes in us saving money so as to not just depend on the solitude of the CPF.

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