They only encourage people to save for retirement, but they don't encourage people to retire earlier. They encourage people to be working till the point where they really cannot work anymore. An example is the constant raising of the retirement age in Singapore.
Wait a minute. You can retire at any age you want in Singapore, at least if you're a citizen of Singapore. The only thing that's changed is the earliest age when you can start drawing CPF retirement benefits, now age 65. (There's also an age 55 withdrawal option of at least $5,000 for most people.) Over many years that number was raised by 10 years. But life expectancy at age 65 increased more than 10 years, so there you go.
If you cannot make today's age 65 CPF LIFE math work as part of your retirement plan, then you wouldn't have been able to make the age 55 retirement math of yesteryear work. If you want to complain, then complain about the fact Singaporeans are living much longer and healthier lives. Which is an odd thing to complain about, but that wonderful reality is a critical part of retirement financial planning.
OK then, CPF LIFE forms part of your retirement plan. Now it's up to you to form the rest of it from your income, your net savings, and your investment choices. Go to the escalating life annuity sellers in Singapore (e.g. NTUC, Manulife, Tokio Marine) and see if you can square the numbers and drop your income to zero, starting at age 41 for example. If the math works, great, that's something you can do. But unfortunately this math just doesn't work at all for most people. Sorry about that! But that's the reality, I'm afraid. Keep earning an income for a couple more years, try to boost savings, make
prudent investment decisions, and sanity check the math again. Does the math work at 43? If it does, great. If not, loop, repeat.
By the way, this particular retirement math gets a heck of a lot easier if you do something a lot of Singaporeans hate to do: avoid having a real estate fetish. (How many threads do we see in this very forum from all the people who think they're going to be real estate tycoons?) Although you might want to have an owner-occupied primary residence, and that might make financial sense (especially with subsidized HDB), you really don't want much of your net worth tied up in illiquid real estate. No, you want plenty of funds to buy that single premium escalating life annuity when you drop your income to zero at age 40, for example. And that's a heck of a lot harder to do if you have $850K of real estate equity locked up. On paper you're fairly wealthy in that event, but your wealth is difficult to reformulate into steady income for living. (Reverse mortgages aren't too popular in Singapore, unfortunately.) In the Singapore context, if you're a believer in this "FIRE" stuff, the most important thing you can do is to be very, very careful about keeping your real estate holdings under tight control. Housing is the "big ticket" item in Singapore, for sure, and unliberated home equity is something of a curse for these purposes. Stick to one, modest primary HDB residence at most. (One could make a very strong argument for divesting that leasehold, liberating the equity, and renting if you're a "FIRE" sort of person.)
