cpf rates should be less than 2%?

[ftpofmpo]

https://www.bloomberg.com/opinion/a...ond-pays-less-than-1-interest-it-s-normal-now

100 yr soverign bonds yields lower than 1% for austria;

lifetime savings interest rates in sgd should also be proportionally low as well?

 

[reddevil0728]

https://www.bloomberg.com/opinion/a...ond-pays-less-than-1-interest-it-s-normal-now

100 yr soverign bonds yields lower than 1% for austria;

lifetime savings interest rates in sgd should also be proportionally low as well?

Why would you want it to be lower???

 

[greythorne]

Why would you want it to be lower???

Maybe if it’s lower, it’s good for those on HDB loan?

 

[Tiger9119]

Maybe if it’s lower, it’s good for those on HDB loan?

HDB loan is pegged at an interest rate of 0.1% above the prevailing CPF Ordinary Account (CPF-OA) interest rate. If HDB loan is lower then the interest rate for OA will also be lower. Those with no outstanding HDB loan will not be happy.

 

[Sleepybugger]

100 yr soverign bonds yields lower than 1% for austria;

lifetime savings interest rates in sgd should also be proportionally low as well?

Not good news at all. I wonder how the rates will be like in the next 3-5years.

Will Asia follow the Western world's footstep of extremely low or negative rates?

 

[reddevil0728]

Maybe if it’s lower, it’s good for those on HDB loan?

Erm. one can always choose to take up bank loan at a lower interest rate and happily enjoy the higher interest rate for CPF.

People who don't have HDB loan would be pissed.

Not really logical at all to want a lower interest rate?

In the first place CPF is meant for retirement. so you want as high of a interest as possible

 

[The_Davis]

HDB loan is pegged at an interest rate of 0.1% above the prevailing CPF Ordinary Account (CPF-OA) interest rate. If HDB loan is lower than the interest rate for OA will also be lower. Those with no outstanding HDB loan will not be happy.

Government will not be happy.

 

[SBC]

Maybe if it’s lower, it’s good for those on HDB loan?

Gum gong not to switch. There is a choice.

 

[ftpofmpo]

Gum gong not to switch. There is a choice.

if it's a u-shaped recovery, then there seems to be no reason cpf rates will remain the same

 

[reddevil0728]

if it's a u-shaped recovery, then there seems to be no reason cpf rates will remain the same

For the sake of not having a riot in Singapore, pretty sure there’s a lot

 

[ftpofmpo]

For the sake of not having a riot in Singapore, pretty sure there’s a lot

y would there be a riot? maintaining high interest rates in a low interest rate environment only serves to transfer wealth from those who do not have to those who have

all millenials should be cheering if those interests are redirected towards investments in their future; rather than supporting the haves

 

[reddevil0728]

y would there be a riot? maintaining high interest rates in a low interest rate environment only serves to transfer wealth from those who do not have to those who have

all millenials should be cheering if those interests are redirected towards investments in their future; rather than supporting the haves

Huh??? CPF is even more important for the have nots rather than the haves when it comes to retirement. Not sure if you are aware of what you are talking about...

 

[ftpofmpo]

Huh??? CPF is even more important for the have nots rather than the haves when it comes to retirement. Not sure if you are aware of what you are talking about...

you'll be right... when a progressive tax on cpf is implemented

 

[reddevil0728]

you'll be right... when a progressive tax on cpf is implemented

Don’t get you. Please enlighten.

 

[F1ngolf2012]

2 points to consider:

1. With the escalating cost of living esp healthcare and an ageing population, there is already gap for retirement based on current returns on CPF saving.
2. The garmen needs to weigh the political cost to lower CPF interest rate to comparable commercial bank rate.

 

[RedsYWNA]

2 points to consider:

1. With the escalating cost of living esp healthcare and an ageing population, there is already gap for retirement based on current returns on CPF saving.
2. The garmen needs to weigh the political cost to lower CPF interest rate to comparable commercial bank rate.

Lower CPF interest rate to comparable commercial bank rate?

Lock up your money for 30 years, and give you 2.5% returns? Give me your money for 30 years, and I can comfortably give you 3.5% returns by investing in index funds.

The fact that MOM is taking 4 years and counting, to implement CPF advisory panel's suggestion of approving a small no of passive, globally diversified index funds is shocking.

 

[limster]

y would there be a riot? maintaining high interest rates in a low interest rate environment only serves to transfer wealth from those who do not have to those who have

this is the first time I've heard of CPF being described as some sort of investment vehicle that only benefits the rich....

The truth is that the rich have plenty of investment alternatives to beat 2.x%. If CPF rate is too low, they can do property/stocks/unit trust investment using CPFIS.

The not so well-off, maybe they cannot take the risk with their CPF funds, have to leave it in CPF to earn whatever interest rate CPF gives so the 2.5% is important.

If you want to reduce inequality, best to be transparent and direct and use taxes on the rich (and maybe increase the tax benefit for charitable donations)

 

[F1ngolf2012]

Lower CPF interest rate to comparable commercial bank rate?

Lock up your money for 30 years, and give you 2.5% returns? Give me your money for 30 years, and I can comfortably give you 3.5% returns by investing in index funds.

The fact that MOM is taking 4 years and counting, to implement CPF advisory panel's suggestion of approving a small no of passive, globally diversified index funds is shocking.

Don't disagree that 2.5% could be a walk in the park if you have 20, 30 years time horizon. What about CPF members who already can freely withdraw their CPF fund?

 

[RedsYWNA]

What about CPF members who already can freely withdraw their CPF fund?

These CPF members had already been receiving sub-optimal returns for more than 20-30 years. Lugi so many years of lost compound interest.

I think its fair not to begrudge them their 2.5% now?

 

[chrisloh65]

I think to reduce inequality, best is to scrap GST (that taxes and penalizes the young, the old, the sick, the disabled and the poor) and increase income taxes directly. But this is just my personal opinion

For reference: Last time GST = 0% (no GST time) and highest income tax bracket = 35%.
Now GST = 7% and highest income tax bracket dropped to = 22%.

this is the first time I've heard of CPF being described as some sort of investment vehicle that only benefits the rich....

The truth is that the rich have plenty of investment alternatives to beat 2.x%. If CPF rate is too low, they can do property/stocks/unit trust investment using CPFIS.

The not so well-off, maybe they cannot take the risk with their CPF funds, have to leave it in CPF to earn whatever interest rate CPF gives so the 2.5% is important.

If you want to reduce inequality, best to be transparent and direct and use taxes on the rich (and maybe increase the tax benefit for charitable donations)