CPF reform

[cscs3]

Instead of commenting on BHS of 49.8k, he should be lamenting why now basic car cost about 100k and a 5rm cost about 350k.

Totally unrelated.

 

[henrylbh]

Don't be misleading. The appropriate comparison is not between the BHS and the MMS $43,500, but the MCC $48,500. You cannot compare it to the MMS because even if you do not have the BHS, you do not need to top it up. One can have $1 inside the MA at age 55 and that will be fine.

What so misleading. Those who have medisave min sum and MCC during this transition will have less or no excess medisave to withdraw at 55. Those who do not have the medisave min sum need not made good.

 

[tiny]

why are you talking about fresh graduates hitting the BHS and retirement sums when these are for those who reach the age of 55?

Do you understand my earlier post?

Let's say a fresh graduate in the year 2030... the BHS is $xxx

Then this fresh graduate reach 55... the BHS is $yyy.

You understand?

 

[kazejin]

just a thought,

if one able to only achieve the Enhance retirement sum in his/her coming years, what's the best option...

1) go ahead oneself to hit the Enhance Retirement Sum target, or
2) split up both shares such as he/her and spouse to achieve Full retirement instead?

I will go for 2) then, and what is your take? Any pro and con?

Just quick highlight that first $x dollars earns higher interest, so more worth it to split into 2.

 

[lzydata]

What so misleading. Those who have medisave min sum and MCC during this transition will have less or no excess medisave to withdraw at 55. Those who do not have the medisave min sum need not made good.

Pardon me. So you are looking out for those "sandwiched" between $43,500 and $48,500 who will be forced OH THE HORROR to keep more than they expected in their MA. Thousands of dollars! My god!

Here's the good news. After one year, someone with $48,500 in his MA will have exceeded the BHS. After three years, someone with $43,500 in his MA will have exceeded the BHS. Far exceeded, actually. All without doing anything.

(Cue complaint that the BHS will increase forever and ever...)

 

[henrylbh]

Just quick highlight that first $x dollars earns higher interest, so more worth it to split into 2.

You need to end what you said with ipso facto. Otherwise, the other half run away how?

 

[lzydata]

You need to end what you said with ipso facto. Otherwise, the other half run away how?

Our civil servants did not think of that angle either, I got to say Maybe they also need to go add footnotes to the infographic.

http://www.mom.gov.sg/Documents/employment-practices/cpf-advisory-panel-infographics.pdf

 

[henrylbh]

Pardon me. So you are looking out for those "sandwiched" between $43,500 and $48,500 who will be forced OH THE HORROR to keep more than they expected in their MA. Thousands of dollars! My god!

Here's the good news. After one year, someone with $48,500 in his MA will have exceeded the BHS. After three years, someone with $43,500 in his MA will have exceeded the BHS. Far exceeded, actually. All without doing anything.

(Cue complaint that the BHS will increase forever and ever...)

To me, the good news is a small comfort. I have always been against the need to make good the ever increasing medisave sum even after you crossed age 55 before you are allowed to withdraw your CPF in excess of min sum. Like the min sum, MMS should be fixed at 55.

Of course like the min sum, BHS (don't find it necessary to coin a new name) will increase forever, but unlikely to affect those who already met the prevailing sum as the interest would likely to match the increase in BHS. Had they fixed it at 55 together with the min sum, there is no need for such change and further confusion to disgruntle members.

 

[henrylbh]

Our civil servants did not think of that angle either, I got to say Maybe they also need to go add footnotes to the infographic.

http://www.mom.gov.sg/Documents/employment-practices/cpf-advisory-panel-infographics.pdf

They are paid to be like that. I wrote to them and no reply. While hanging on to their hotline, they mentioned that if you have met the min sum, you can leave your withdrawal sum in the CPF to earn higher interest!!! But they never tell you that when you want withdraw later, you need to make good the prevailing MMS.

 

[hwmook]

Do you understand my earlier post?

Let's say a fresh graduate in the year 2030... the BHS is $xxx

Then this fresh graduate reach 55... the BHS is $yyy.

You understand?

Nobody understand what the heck are you anal about? The current min sum is set for those who are going to reach 55, nobody care about those 25 because we need to worry about that 30 years later. Do you understand?

 

[havetheveryfun]

Nobody understand what the heck are you anal about? The current min sum is set for those who are going to reach 55, nobody care about those 25 because we need to worry about that 30 years later. Do you understand?

cos govt encourages us to plan earlier for our retirement.

so u are saying a person should only worry about not being able to hit that min sum when hes 50 or 55 ? By then what can he do about it ? complain to the govt?

retirement planning should start as early possible, so as to avoid this problem

 

[anfielder]

cos govt encourages us to plan earlier for our retirement.

so u are saying a person should only worry about not being able to hit that min sum when hes 50 or 55 ? By then what can he do about it ? complain to the govt?

retirement planning should start as early possible, so as to avoid this problem

But these sums are still more predictable than some of the other factors in your retirement planning. You can roughly project what the BHS will be in 30 years but can you really predict what your income and expenses will be in 30 years?

By all means plan as early as possible and make use of the compounding effect but be prepared to make adjustments along the way.

 

[havetheveryfun]

But these sums are still more predictable than some of the other factors in your retirement planning. You can roughly project what the BHS will be in 30 years but can you really predict what your income and expenses will be in 30 years?

and there u have the reason why the guy brought up the BHS or min sum for fresh grads. since u were asking why he brought up this issue for fresh grads

as the min sum will definitely increase, but salaries have not been improving much while expenses have been going up

 

[anfielder]

salaries have not been improving much

That statement is not backed by facts.

 

[djchris]

and there u have the reason why the guy brought up the BHS or min sum for fresh grads. since u were asking why he brought up this issue for fresh grads

as the min sum will definitely increase, but salaries have not been improving much while expenses have been going up

I feel that the advantage for fresh grads is that they can now 'forecast' what their BHS and BRS will roughly be when they reach 55. Naturally, policies change along the way but at least there's a number to plan for.

For CPF, the real target for fresh grads to strive to achieve is $6000 to maximise CPF contributions. It's not a low hanging fruit and probably will require a few years before fresh grads can hit this target. The earlier they hit the target, the faster they reach their BRS and BHS.

But if at the age of 25 you already have the preconception that salaries are not improving and it is not possible to achieve BRS and BHS when you reach 55, then you are dead in the water, my friend.

 

[havetheveryfun]

That statement is not backed by facts.

the same as u cant really prove that salaries have been improving by facts either.

anyway, whether salaries is improving or not is not the point here - the point is here is that fresh grads do indeed HAVE to worry about the min sum no matter what age they are right now, contrary to what you have said about fresh grad should not worry about it since its something that's 30 yrs down the road.

 

[lzydata]

the same as u cant really prove that salaries have been improving by facts either.

anyway, whether salaries is improving or not is not the point here - the point is here is that fresh grads do indeed HAVE to worry about the min sum no matter what age they are right now, contrary to what you have said about fresh grad should not worry about it since its something that's 30 yrs down the road.

As Tan Chuan Jin's example shows, even a diploma holder with a slightly-below-median starting salary and minimal assumptions - e.g. no salary raises in 30 years - will earn enough for his SA to meet today's Full RS. If you've missed it, please go look at that.

Rather than worry about something you have no control over - what the BRS or FRS is going to be in 30 years' time, which nobody knows, not even the minister himself - you should worry about something you do have control over: what you earn. Are you putting in effort in your studies and your work to command a good salary. Do you deserve raises because you are adding value. Or are you just coasting along and hoping for the best.

Also, it's not just what you earn, but what you save. If your expenses equal or exceed your income, you will always feel you don't have enough. But if you can save and invest wisely, you don't even have to care what the retirement sum is. You already have enough outside the CPF to retire and your CPF money is just a fallback. That's called taking charge of your financial life. I think it's an ideal we can all aim for, even if we are starting from zero.

 

[Lewis.T]

As Tan Chuan Jin's example shows, even a diploma holder with a slightly-below-median starting salary and minimal assumptions - e.g. no salary raises in 30 years - will earn enough for his SA to meet today's Full RS. If you've missed it, please go look at that.

Rather than worry about something you have no control over - what the BRS or FRS is going to be in 30 years' time, which nobody knows, not even the minister himself - you should worry about something you do have control over: what you earn. Are you putting in effort in your studies and your work to command a good salary. Do you deserve raises because you are adding value. Or are you just coasting along and hoping for the best.

Also, it's not just what you earn, but what you save. If your expenses equal or exceed your income, you will always feel you don't have enough. But if you can save and invest wisely, you don't even have to care what the retirement sum is. You already have enough outside the CPF to retire and your CPF money is just a fallback. That's called taking charge of your financial life. I think it's an ideal we can all aim for, even if we are starting from zero.

I didn't know that 30 years ago, the slightly-below-median starting salary for a diploma holder was that high.

All sarcasm aside, don't believe everything that is said. Try to think for yourself if it's true. If it's really true, why are more than half of us unable to meet the minimum sum in SA if it can be met so easily as per his assumptions of a diploma holder working for 30 years?

If it's true, why are degree holders worrying about it?

One thing though, is that the Medisave not requiring a minimum will be a much needed boon to the CPF scheme.

 

[wts2013]

I didn't know that 30 years ago, the slightly-below-median starting salary for a diploma holder was that high.

All sarcasm aside, don't believe everything that is said. Try to think for yourself if it's true. If it's really true, why are more than half of us unable to meet the minimum sum in SA if it can be met so easily as per his assumptions of a diploma holder working for 30 years?

If it's true, why are degree holders worrying about it?

One thing though, is that the Medisave not requiring a minimum will be a much needed boon to the CPF scheme.

hahaha, u got statistics who are those "more than half" cannot meet" and your basis for comparison?

There are many other variables he did not factor in besides assuming constant salary, eg CPF rates can be cut, etc.

But look at the latest revision in CPF rules, much better than in the past, can withdraw not subject to minimum sum in medisave and retirement sum, u are all so lucky now.

Focus on working hard, earning more, and saving more. CPF is just a contingency plan. Got money is good/lucky lor, hahaha

 

[Lewis.T]

hahaha, u got statistics who are those "more than half" cannot meet" and your basis for comparison?

There are many other variables he did not factor in besides assuming constant salary, eg CPF rates can be cut, etc.

But look at the latest revision in CPF rules, much better than in the past, can withdraw not subject to minimum sum in medisave and retirement sum, u are all so lucky now.

Focus on working hard, earning more, and saving more. CPF is just a contingency plan. Got money is good/lucky lor, hahaha

Leong Sze Hian » CPF: The propaganda continues?

From CNA source, personal research from several financial professionals, the list is quite abundant.

In fact, the government themselves may have admitted it, but I may be mistaken on this part.