Many people are confused with CPF Life, Medishield Life and Eldershield Life.
They are also confused with the earlier versions of these CPF schemes. They do not understand what is being covered under each scheme. Some of the coverage seems to be over lapping.
To add to the confusion, there are two options available in CPF Life (previously, there were four). There are also many options available under the integrated plans (which is an alternative to Medishield Life).
They still do not understand what is covered under Eldershield or Eldershield Life. Even if someone takes the trouble to explain to them, it will not help. They will remain confused.
Some of these schemes are compulsory and some are opt-out. And some are compuslory only for certain people and optional for the others. This adds to the confusion.
Confused? So am I.
I believe that all of these "Life" schemes are cooked up by Lee HL. He likes to have complicated schemes because he can understand them. But he does not realize that most other people are not as smart as he is. How many people graduated with a double first degree from a prestigious UK university?
Maybe, he has another reason. Maybe he wants the "Life" schemes to be his legacy.
With the passage of time, will people get to understand these schemes better? I doubt it. A decade has passed, and many people are still confused with them. Some might understand the scheme, but many are not able to cope.
Could all of these confusion be avoided?
Yes. If someone cared to listen. Ten years ago or thereabouts, there was a committee formed to study CPF Life. I met the committee. I gave my views - do not make CPF Life compulsory, make it attractive!
Basically, I suggested that members should be allowed to take out their CPF savings at 65 if they wish to. It is their money. Let them decide what to do with it. Maybe they have some debt and need the money to repay the debt.
However, make CPF Life attractive. Offer an attractive subsidy for them to buy this plan. For example, it may cost $100,000 to buy a life annuity that makes a monthly payment of $X for the rest of life. If they buy a similar plan from CPF Life, they only need to pay $70,000 from the CPF savings. The subsidy of 30% comes from the government.
The government can afford the subsidy because they have been making a lot of money from the difference between what they actually earned from investing the CPF savings and the interest of 2.5% paid to the CPF members. That is a lot of money for all the past years.
If there is an attractive subsidy, I am sure that many people will queue up to join CPF Life. Some may hesistate initially (because they don't trust the government) but they will queue up later when they saw other people joined voluntarily.
The same approach can be done for Medishield Life and for Eldershield Life. By the way, there is no need for Eldershield because it can be made a part of Medishield.
I am sure that the people who joined will understand the scheme. They will not be confused. They will remember that they paid only $70,000 for a scheme that cost $100,000 in the private market.
Sadly, the committee refused to consider my suggestion. They must be thinking about what Lee HL wanted. He wanted CPF Life a certain way .He got it.
And the people got all kinds of confusing "Life" schemes that they cannot understand.
Welcome to Singapore.
Tan Kin Lian
They are also confused with the earlier versions of these CPF schemes. They do not understand what is being covered under each scheme. Some of the coverage seems to be over lapping.
To add to the confusion, there are two options available in CPF Life (previously, there were four). There are also many options available under the integrated plans (which is an alternative to Medishield Life).
They still do not understand what is covered under Eldershield or Eldershield Life. Even if someone takes the trouble to explain to them, it will not help. They will remain confused.
Some of these schemes are compulsory and some are opt-out. And some are compuslory only for certain people and optional for the others. This adds to the confusion.
Confused? So am I.
I believe that all of these "Life" schemes are cooked up by Lee HL. He likes to have complicated schemes because he can understand them. But he does not realize that most other people are not as smart as he is. How many people graduated with a double first degree from a prestigious UK university?
Maybe, he has another reason. Maybe he wants the "Life" schemes to be his legacy.
With the passage of time, will people get to understand these schemes better? I doubt it. A decade has passed, and many people are still confused with them. Some might understand the scheme, but many are not able to cope.
Could all of these confusion be avoided?
Yes. If someone cared to listen. Ten years ago or thereabouts, there was a committee formed to study CPF Life. I met the committee. I gave my views - do not make CPF Life compulsory, make it attractive!
Basically, I suggested that members should be allowed to take out their CPF savings at 65 if they wish to. It is their money. Let them decide what to do with it. Maybe they have some debt and need the money to repay the debt.
However, make CPF Life attractive. Offer an attractive subsidy for them to buy this plan. For example, it may cost $100,000 to buy a life annuity that makes a monthly payment of $X for the rest of life. If they buy a similar plan from CPF Life, they only need to pay $70,000 from the CPF savings. The subsidy of 30% comes from the government.
The government can afford the subsidy because they have been making a lot of money from the difference between what they actually earned from investing the CPF savings and the interest of 2.5% paid to the CPF members. That is a lot of money for all the past years.
If there is an attractive subsidy, I am sure that many people will queue up to join CPF Life. Some may hesistate initially (because they don't trust the government) but they will queue up later when they saw other people joined voluntarily.
The same approach can be done for Medishield Life and for Eldershield Life. By the way, there is no need for Eldershield because it can be made a part of Medishield.
I am sure that the people who joined will understand the scheme. They will not be confused. They will remember that they paid only $70,000 for a scheme that cost $100,000 in the private market.
Sadly, the committee refused to consider my suggestion. They must be thinking about what Lee HL wanted. He wanted CPF Life a certain way .He got it.
And the people got all kinds of confusing "Life" schemes that they cannot understand.
Welcome to Singapore.
Tan Kin Lian
1 comment:
"If you can't convince them, confuse them".
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