Thursday, 17 July 2008

I just save 180,0000 SGD

I was trying to sort out my Singapore Permanent Resident(PR) when this issue CAUGHT my eyes. Note that in singapore there is a pension scheme called CPF compulsory for both PR and Singapore citizen.

Let me begin by telling my story. When I was in University in Singapore way back then, I was told (or probably read) from somewhere that there is a pension scheme held by Government. It was like you contribute 20% of your salary and your employer putting in 13% and that's made up your pension savings which you can withdraw when you are 55!!
Coming from 3-rd-world-country background, whereby there is no advance pension scheme and everyone taking care of their own butt thingy. I was sincerely think that Singapore Government doing a good deeds to start this off. When I started working, I start to join the system and gladly looking forward to pile my own pension. And then, the age limit whereby you can withdraw your money changed from 55 to 65. Which probably okay to me, as I think other country probably have the same age limit.

Today, I learn the fact that Singapore Government introducing a scheme called "annuity". What I understood is the scheme will press people to leave AT LEAST 90,000 SGD inside their pension pot. So say you have 200,000 SGD on your CPF by the time you reach 65. You can take 110,000 and leave the rest on your pension pot. Meanwhile, government will pay you an installment somewhat like 600 SGD a month of your CPF and if you reach the age of 85. If you reach the age of 85, that's great... you can get the rest of 90,000 back! What if you die at 84? It's going to be GONE. Yes... I repeat, it will be gone....probably to temasek holdings pocket!
Now, do you know how many people lived till age 85 in Singapore?

I like the following comments on other's blogger's blog :

So far, no one has proven that CPF is a system
which will work—in the long term. Sure, in the last 40 years or so the belief is
that it does, because people are swayed by the "illusion" that they can actually
own property from the scheme—yes, certain results are possible in the short to
medium term.

What CPF is is actually a TAX. The fact that they
give you a statement of account is total bullshit—but people fall for the ploy
because it has the "officialness" of govt backing it.

To me, it's no problem if UK Government impose me a 20% tax. Is a TAX and I don't entitle it back except I am fallen under certain category to ask for rebates or refund. But how bad is titling something as "pension" means "what rightfully yours" and then holding it back? Now that's a daylight robbery!

So what could possibly happen?
Emigration. It becomes more attractive to EMIGRATE—to renounce YOUR
Singapore citizenship and take ALL YOUR MONEY, and move to another country.

In fact, by doing just that (ACTION) is much more effective that signing and
submitting a poorly-worded emotive petition (WORDS) — which despite my
reservations regarding its effectiveness, I will sign anyway.Taking the idea
further: It becomes "better" to renounce one's citizenship, emigrate with family
to say, Perth (excuse my personal bias), plonk the ex-CPF loot down on a DECENT
house—i.e. a REAL upgrade from the over-priced politicised HDB shoe box, and
return to S'pore if necessary as an expat to work—on an expat salary
package.Then, offer a burnt offering, fall on one's knees, thank the PAP for
creating the opportunity ;)

Good, I choose option no.1 then!!! Don't think fall on my kness will get me anywhere thus far. And if they can justify their way of robbing 90K out of you, how difficult is to push the minimum amount to 120K in 4 years time? No one knows when they change their mind and push the limit up. According to my experience (from 55 to 65 and now to 85) this Government never going to push the standart down. Rest assure, it will increase.

The trouble with S'pore is that most people believe "the government will SAVE ME
from... myself", and so an ENTITLEMENT mentality is fostered and ingrained.

Yes, I used to believe that Singapore Government is perfect, kind towards its citizen, have a scheme that the most well thought in the world. Guess I loooove Gordon Brown now! It's quite surprising fact that none of my friends in Singapore (bear in mind I have quite a number of friends down there) highlight to me about this new "scheme"... (or rather scam). The only thing I could think of is :
1. Ones is not aware of it, probably busy piling CPF
2. Ones is aware of it, but who cares... I am just 28!
3. Ones is aware of it, but what else can I do?
4. Ones is aware of it, but hey... isn't Singapore Government know how to manage money better than us?

Read more here. In fact, I just calculated... if I am out of this system. If both me and my husband had an CPF and denounce my PR, and died at 84, this going to save me 90,000 times 2 = 180,000 SGD. Sounded like a saving of 10 solid years of life being Embedded System engineer.

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