The email address in "Contact AK: Ads and more" above will vanish from November 2018.


Featured blog.

1M50 CPF millionaire in 2021!

Ever since the CPFB introduced a colorful pie chart of our CPF savings a few years ago, I would look forward to mine every year like a teena...

Past blog posts now load week by week. The old style created a problem for some as the system would load 50 blog posts each time. Hope the new style is better. Search archives in box below.


"E-book" by AK

Second "e-book".

Another free "e-book".

4th free "e-book".

Pageviews since Dec'09

Recent Comments

ASSI's Guest bloggers

An(other) open letter to the Prime Minister.

Wednesday, June 11, 2014

If we are prepared to divorce our wife, we can kick our mother in law in the butt. ;p

If we are prepared to renounce our Singapore citizenship, then, we can kick the CPF in the butt. LOL.

That is always an option that disgruntled CPF members who want their CPF funds released in full can consider, some would say.

They say that we cannot have our cake and eat it too. Now, I think Roy et. al. are trying to have their cake and eat it too by pushing for CPF funds to be returned in full to the public without having to give up their Singapore citizenship. Could this happen? It could possibly happen with a change in our country's leadership. For me, it is a scary thought as I feel that the CPF now is more good than bad.

However, I have faith that as long as there is a sensible silent majority, as long as Singapore is a democracy, the system now will most likely stay intact. Crossing fingers.

Writing open letters to the Prime Minister seems to be the thing to do now and AK will also write one saying what AK would do if he were in government.

Dear Prime Minister,

1. Without deviating from the philosophy that is the bedrock of the system, power up the system to provide higher returns. Singapore is a very expensive country to live in and also to retire in. It is about helping CPF members feel more secure about meeting their retirement needs, a hot topic for a while now. Powering up the returns on the first $60K in the OA and SA was something you did before. Now, powering it up a bit more will definitely help.

2. Inject some compassion into the system while staying level headed. There are those who are irresponsible, who had advantages but squandered them. There are also those who suffer through no fault of their own. Applications by these CPF members to tap into their CPF savings could be given consideration.

Allow micro-tapping if it is going to help meet these members' needs in life. Explain to them the consequences of micro-tapping over the longer term and try to find better and socially more responsible solutions to their problems so that they are resolved permanently.

3. Step up efforts to educate the public on how the CPF can work for them. Let them know what they can do to make a secure retirement happen with their CPF savings as a cornerstone of their financial portfolio. It is about the public helping the CPF to help themselves.

Knowledge gives everyone power while the lack of knowledge gives some amongst us power. This will give a new meaning to the phrase "power to the people" which Roy Ngerng et. al. are using now to rally support. 

Once financial literacy is widespread amongst the people, then, the people will truly have power over their financial health. Only then, will they be truly powerful.

Constant wide reaching education done well is the most important measure to take and will empower our people.


Related posts:
1. We do a better job than the CPF.
2. Achieving level one financial security.


AK63 said...

Have you considered applying as an MP? Be the independent voice and the person-on-the-fence who can offer some opinions and suggestions as an outsider to all these politically-charged people of parliament? :)

I think all these (un)opened letters to our PM are a good waste of time other than drumming up more emotions from both camps....

If I have the capabilities, I would rather make myself heard physically, maybe by forcing an audience with our PM? Be some sort of martyr? Maybe? :)

havefund said...

I hope you send it... I am with you in this.

AK71 said...

Hi AK63,

Saint AK71? OMG! :(

I know Roy Ngerng wants to be an NMP. I don't know if I want to be an NMP.

Firstly, I doubt that I am qualified and, secondly, losing my privacy is a big, big thing to me. -.-"

AK71 said...

Hi havefund,

Actually, a friend just suggested that I do this too. How do we send letters to the Prime Minister, I wonder?

If you know how, help me send, can? :)

havefund said...

You sure I will send it to his Facebook

AK71 said...

Hi havefund,

Sure, I am OK with it. If you feel that it will be useful in some way, please help me send. Thanks for the suggestion. :)

havefund said...

I think it will cos I am really afraid those clowns might just win and tip this country over come 2016

AK71 said...

Hi havefund,

Misinformation riding on the back of highly charged emotions is a powerful force.

If Singaporeans are armed with the correct information, then, those spreading misinformation will find themselves powerless.

The fact that there is some severe unhappiness in some quarters, however, shows that the government can do better and they have to.

If there is no weakness in the system, if a good job has been done in educating the public, then, the recent protest in Hong Lim Park would not have had a chance.

Thanks for sending this open letter to the PM. I hope he has some time to look at it. ;p

havefund said...

Just send and I agreed. My wish is do a better PR and education / communication job and inject more flexibility and options in CPF. Cheers

havefund said...

Check your FB btw, if not picked up it still can go by the official route to PM office.

Unknown said...

Hi AK,

I totally agree with you in point no. 2. I felt that it's because of CPF inflexibility and the government refused to address the issue in a transparent manner that causes all this. i feel that if they could hold a public conference to talk about this CPF issue might able to help to reduce the impart and also by implementing point no.2 this might solve some of the unhappiness.

AK71 said...

Hi havefund,

I see it. Aiyoh, I didn't expect to be included in the FB picture. So paiseh now.

What if the PM talks to me and asks me questions? Oh, no! Cham! How?

I thought you were just going to send him the link to the blog post. LOL.

Oh, well. Must put on my best citizen hat and be respectful and remember not to lapse into Singlish. -.-"

havefund said...

You will be ok

havefund said...

Do no error see no evil

AK71 said...

Hi 玉龍,

A case of high IQ but not high enough EQ on the part of the government, perhaps? Possibly. -.-"

Unknown said...

Hi AK,
Just my two cents worth on this issue. I agree that the original concept of CPF for retirement is good. But we seemed to lose our way by allowing it to be used for private housing, medical, etc. In doing so, cost of housing and medical have ballooned , eroding what's left in CPF. To the extent that many are unable to rely on CPF for retirement income, this is compounded by the relatively low interest payment for CPF OA. Against the backdrop where Temasek and GIC makes relatively higher returns and the paltry amount of interest that CPF members earned, it is understandable that we have an outcry today. There is no going back to reverse the policy on the use of CPF funds by members. But going forward, there must be a better way to handle the CPF funds to give members a bigger return. The use of CPF funds cannot be relaxed without the running into the risk of insufficient funds upon one's retirement. I hope people will not get emotional but allow reason and common sense to prevail. On the govt's part, it is clear that the citizenry demands transparency and accountability in the way GIC and Temasek are managed. To ignore such demands on the grounds that they are managed through independent boards or their workings are top secret cut no ice with Singaporeans and continuing to hold the ground would only lead to a lost of trust. So far the respond from the govt are rather weak against a barage of criticisms esp. in the internet.
Policy makers could well heed the call to rein in public housing prices and medical cost in public hospitals . This will benefit the younger Gen Y who are the ones that will find relying on CPF for retirement very challenging. Sure, people should have personal savings or invest wisely but given our cost of living and so many pressing priorities it is something not easy for the common folks.

Tiger said...

I think there is another reason why government has decided to raise the minimum sum. I believe Singapore's population is aging due to low birth rate. As such CPF membership is also aging. If everybody decides withdraw the whole sum, CPF's long term investments will be affected significantly.

AK71 said...

Hi Les Lim,

It is not easy but it is possible. It is not easy and so, we have to try harder. I always say that the methods are simple but it is not so easy to follow. :)

It is not just the Gen Y who find retiring on their CPF money very challenging. Even the Gen X finds it so. The CPF is the most basic of safety nets for Singaporeans, after all.

Gen Y has more of a valuable asset compared to Gen X. Time. Make use of time and the relatively high risk free rate provided by the CPF to grow your savings for retirement.

I wish for a higher risk free rate from the CPF too. 6% on the first $60K, perhaps? However, I would disagree that the current risk free rates of 2.5% to 5% are paltry. I do not think we can find a AAA investment product anywhere in the world that will give such returns today. We have to compare apple with apples.

Finally, I do not think the "ballooning" prices of housing and healthcare in Singapore is due to using our CPF savings to pay for these. It seems like the cart has been put in front of the horse in such a statement.

In fact, we should be thankful that the CPF-OA and MA are there to help us pay for our homes and healthcare needs, earning 2.5% and 4% per annum risk free until they are drawn upon.

The system is not perfect but we should try to understand the system and, by making correct comparisons, appreciate its strengths and how we can fully make use of the strengths. It is about helping the CPF to help ourselves. :)

Finally, we must of course not forget those who genuinely need a helping hand but for the rest of us who know how to extract the maximum benefit from the system, we should not be asking for more help. Resources should go to those who need help most.

Of course, if the CPF could help us a bit more in our efforts, we should be grateful. :)

Unknown said...

Hi AK,
I remembered the days that property prices shot up when CPF was allowed to be used for private housing. This changed the affordability landscape.The same for medical cost when medisave was created.
30 years ago when I was first buying my first public housing ( HUDC), it cost about 220K. Being conservative, we took a loan where only half the CPF contribution would go to servicing the laon and the remainder for our retirement. It is difficult now for Gen Y to do the same where they have to use their CPF to the max and stretch their payments to their retirement age. How to save for retirement. Of course there is the unplatable route of monetising your home.

AK63 said...

If the government has not allowed cpf funds to be used for housing and medical needs, they might lose more than just a few seats in the previous two elections. Worse, we might all be having our cakes and eating them now, and maybe some would have finished theirs and asked for yours.... :p

With such adjustment and improvement to cpf act already in place through the years, we still have many here saying they will die before seeing their monies, so how? Release the floodgates and see who will float and who will drown? Or clammed up completely and hope everyone is as reasonable as everyone else and pray that common sense will prevail?

Don't know about you, but for me, both won't work and the consequences will only be known after making that leap of faith, and then it will be too late....

There must be a compromise in order to move forward, and I hope this government can finalise something timely to make concessions for those really in dire situations....

Choon Yuan said...

Hi Ak,

I have written in to the Straits Times similar to your point 1. Hope it gets published tomorrow!

AK71 said...

Hi Les Lim,

Ah, that is what you were referring to. Yes, the relaxation of the CPF rules to allow money in the OA to buy private housing did cause a bubble back then. Then, the bubble burst which they always do. There is always a mean reversion in any market.

However, the steady upward march of property prices cannot be attributed to the same reason because prices did come back down to saner levels. Inflation is a steady phenomenon in Singapore. The liberalisation of CPF rules for purchase of private housing was a one off event.

Today, prices of properties in Singapore are much higher mainly due to the "growth at all cost" strategy which the government misguidedly put in place years before the last GE and the abnormal monetary measures in the major economies around the world which have caused asset prices to inflate in countries like ours as money try to get to where it would be treated best.

As for the idea that the creation of Medisave has led to higher cost of healthcare in Singapore, I really cannot see a logical connection. :(

For sure, Gen Y face the challenge of higher home prices today. However, how we view the challenges and what we do will determine the outcome in any set of circumstances.

If I were a Gen Y person now, I would wait before buying a property unless I really needed one now. If I really needed one now, I would go for sale of balance flats (BTO) where prices have been brought down by KBW through his actions. Thank goodness MBT was removed.

Then, I would make sure to plan my finances prudently so that I would still have savings. I would make sure I had an emergency fund. I would make sure to be properly insured. Then, I would look at how I could invest for income to help supplement my earned income, all the while seeking to upgrade myself and to command higher pay.

I believe that young people in Singapore still have plenty of hope compared to young people in Hong Kong or Taiwan, for example, who can only dream of being home owners. Hence, my many blog posts to inspire them. :)

AK71 said...

Hi AK63,

I agree that the government should not wait too long to issue an official response to the matter. Every Singaporean and not just those who spent a day at Hong Lim Park recently are waiting for it, I am sure.

Unknown said...


Wa, the letter is very well written pls REALLY send it to our PM!
The CPF scheme is great but personally i feel Singaporeans should be given the opportunity to learn how to be responsible for their own finances. Some may have to learn the hard way though. I have a preference for flexibility in money management, and believe that a mature individual will plan their finances! Just like the fans here who read your blog! So hopefully they can come up with an innovative concept so that some of us can withdraw the cpf sum for emergency purposes etc. ;P
And of course no policy is perfect and it can't please everyone! so i m fine if this does not happen ;)

i have friends who are so reliant on the CPF scheme, taking for granted that this is their retirement safety net, they become sloppy in their finances and sluggish in savings!

Our poor Govt yong xin liang ku! Hope they step up efforts to help Singaporeans understand the scheme better.

and that dear Roy is just so NO BRAIN! Attention seeker and wayang all the way!

just my liang fen qian! ;)

AK71 said...

Hi Chan Yuan,

Anything to help us towards a more secure retirement. ;)

Well, to be fair, although an extra 1% on the first $60K might not seem like a lot to us, it is a huge burden on the government. Imagine having to guarantee a return of 6% year after year. Not easy. Of course, if they offer, I will take. ;p

AK71 said...

Hi Anuenue H,

I still have no idea how to really send a letter to our PM. Hahaha... You are free to send to him on my behalf. ;p

Actually, another reader PM our PM on FB regarding my open letter already. I am not sure if the PM will have the time to read it though. :)

As for your friends who are overly reliant on the CPF, thinking that it is enough to fund their retirement, please talk to them if you have a chance to.

Sharing with them your experience and knowledge might give them a little nudge to do more towards a more financially secure retirement. You will be doing good. :)

Ignore Roy. LOL. I do really hope the majority of Singaporeans will ignore him.

Unknown said...

Yes, we have been short changed. The interest is too low. If we vest ourselves in the sti eft, it return some 8% it is much better than what the govt are giving.

AK71 said...

Hi Unknown,

We have to compare apple with apples. We cannot compare the CPF which is like a bond with an ETF based on a basket of stocks.

Ray said...

Actually the whole issue with locking away the CPF was the prevent those lecherous uncles from being conned of all their CPF money by the PRC girlfriends.

Happened all around us few years back which prompted govt to locked down the CPF and only allow draw downs for monthly usage.

Regarding the open letter on assessing individually how responsible the applicants are before allowing them to draw everything / tap into their CPF. I felt that it is almost impossible to assess as they could be no assurance the criteria would be fair and nobody would game the system.

The only best solution is to err on the side of caution. On this bit, I agree wholeheartedly with the govt's approach.

Those who argued that CPF is our money and we have the right to throw those money away to PRC girlfriends if we choose to are simply missing the big picture. If citizens are in trouble, cannot pay for daily necessity, there will be a huge burden to the country and other citizens would have to bear the consequences. This simply cannot be allowed.

my 2 cents worth.

AK71 said...

Hi Ray,

I am against the idea of allowing people to withdraw all their CPF savings at age 55 too although I am not sure that every guy at that age would have a girlfriend from PRC with a weakness for old (and gullible) gentlemen. ;p

As for the idea on micro-tapping which I proposed, it is either this or we give more help via social services to people who need help genuinely. I think that criteria for deciding who needs social and financial assistance could be used in deciding on candidates who could be allowed to tap into their CPF savings to help them better meet their needs in life.

While we do this, we have to impress upon them that they are drawing down on their future annuity income. Help should be given to help them upgrade their skills, improve their employability and secure higher paying jobs in the meantime. They should also be educated on financial prudence. It has to be a full package deal. :)

Ray said...

hi AK,

Of course not all men have PRC girlfriends but as a policy maker, you have to set the standard that will catch all scenarios. Erring on the side of caution is almost always needed.

As for educating, sure we can do that but there will always be irresponsible people and those innovative enough to game the system. Who's to say they won't gamble the money away right? They will then become poor and need govt to bail them out.

AK71 said...

Hi Ray,

Yes, I hear you and I tend to agree with you too. :)

Unfortunately, there will always be those who are not financially prudent, there will always be those who are irresponsible and there will always be those who are easily swayed by populist ideas.

However, it is also true that there is more tension on the ground now then I have ever felt in my adult life as a Singaporean.

As long as the majority of the population remains sensible, the system will remain intact but what I am concerned about goes beyond keeping the system intact and safeguarding the financial future of all Singaporeans.

I also want to see the tension diffused and trust restored in the system. So, there must be a long term solution and education is the best tool there is.

Granted that we can never have everyone persuaded that the system works but if more are educated to understand the how and the why, if a bigger majority is empowered with the correct knowledge, we will have a better shot at maintaining peace and harmony in Singapore.

Reduce the number of the financially ignorant or irresponsible via education? Yes. Eradicate? Unlikely. Still, it is a worthwhile effort. :)

Ray said...

I understand your view too and I also think the sentiments from the ground is very hostile. This is actually to be expected as the population gets more educated and vocal and with internet as a medium to propagate ideas, we are in an era like never before.

What I feel could be done by the govt is they share more of the money they earn from utilizing our CPF as their investment funds.

I know our CPF is principal-protected but 2.5%+ is really too low compared to what we can get from the banks - OCBC is giving 3% now and it's not even a FIXED DEP plan.

If they do that, the opportunity cost of money stuck in CPF is lower. Also, draw down for special needs(like you mentioned) need to be addressed less rigidly.

AK71 said...

Hi Ray,

I have to come back to the point about comparing apple with apples. ;p

The OCBC 360 is a deal that has quite a few conditions attached. Must credit salaries monthly, spend using OCBC credit cards etc. If I don't do these and I just want to leave the money in a fixed deposit, they won't give 3% in interest payment to me.

People say that we should be paid more of the gains made by GIC, for example, but then, should we also share the losses made by GIC?

Investing the money in the STI ETF would have given better returns, some say. Hindsight is always perfect. Can the majority of the population stomach the volatility? Imagine seeing our retirement savings plummet by more than 50% during the GFC. My CPF savings gave me a peace of mind back then.

I would like to be paid higher interest rates on our CPF savings too, naturally. However, we should understand that this is essentially a AAA rated long term bond that retains the coupons, compounding the returns. So, 2.5% to 5% per annum are quite decent but more would be better, of course. ;)

As for the opportunity cost you mentioned, like I said, for those who have low or no financial literacy, opportunity cost is really zero. Unfortunately, I believe a big proportion of the population fall into this category.

Betta man said...

Since GIC manages the CPF monies, GIC could have a dividend policy whereby a certain % of each year's earnings is paid out to CPF members' SA account.

Hence, on top of of the 4-5% interest on the SA, anything about is a bonus and varies from year to year.

Hence, the govt need not be stressed by promising a higher interest rate as suggested by some folks.

AK71 said...

Hi betta man,

GIC doesn't manage CPF money. More accurately, it borrows money from the CPF to invest. GIC bears all the risk of investment while CPF members are paid risk free rates of 2.5% to 5% per annum.

If we want a floor of 4% to 5% in risk free rates for the money we have in our SA, we cannot ask for more in the years that GIC do better but are unwilling to receive less than 4% in years that GIC do worse, to be fair.

However, if the government should offer what you suggested, I will be happy to accept, of course. Also, like you said, this is less stressful than having to guarantee an extra 1% year after year. ;p

Once we understand how the system works and once we make appropriate comparisons, we will realise why the CPF's rates of 2.5% to 5% are actually not bad. Still, more is better. :)

Unknown said...

While I agreed with no full withdrawal at 55 will be a more sensible choice given that the financial literacy in Singapore is low, but I get ticked off whenever I see people mentioning the Government is protecting us from getting cheated by the PRC or whatever nationalities ladies.

Why cherry pick that few cases and used it to justify your policy? What is the statistics of such cases? 1 in 100 or 1 in 1000 or 1 in 10,000? Does the % of old men being cheated justify for the policy? I thought policies are crafted for the greater good for the majority?

Can I cherry pick the few cases of how casino had destroyed families and call for the casinos in Singapore should be closed down?

This is the one of the nonsense reasoning that the Government give that make me lose faith in them... They are like some of the India ministers who come out with statements like rape cases are caused by ladies wearing tight jeans or short skirts... Totally nonsense...

pf said...

Ok. To be honest, I don't think cpf is a bad scheme. But it doesn't work for everyone. Worse is that many people don't know how it works. And I would like to voice out how it doesn't work so that the govt can think about it. Its not all or nothing. I don't know why some people are discussing to win something. Win what?

I don't see why we need to get into so much discussion and do the thinking bits for the govt. To convince ourselves that we should just be happy with what we have and shut up?

There are many scholars in govt who have used the tax money to get the education. So, they should come up with some proposition for us.

Well, what I wanna is, I believe in complaining. :)

Ray said...

At the rate the minimum sum is climbing, by the time I hit 55, the minimum sum would be $500K.

It is very difficult to meet the min sum when it's growing at a rate of 6%+ but we can only invest a small part of the CPF through investment in stocks/bonds and the rest of the money are growing at a miserable 2.5%

If govt wants to raise min sum at this rate, they must help us to grow the locked away CPF at a much higher rate otherwise a good 80% of Singaporeans won't meet the min sum.

Ray said...

To Lim LS>>

PRC girlfriends is just an example. An exhaustive list is not possible given that everyone is different. But the thing they try to prevent is squandering your retirement money prematurely. It could be gambling, buying prada, buying cars that you don't need, holidays etc. You get the point?

They won't shut casinos because they generate ALOT of revenue for the country. They will make it very tough for citizens to go in and I feel they are doing a very good job already. I for one have not gone to casino because of the entrance fees.

I don't know how you can relate our govt with the indian ministers. The indians are justifying crimes! Our ministers are setting policies to guard against foolish spending. How is it similar? Don't let your rage consume your judgement.

CPF scheme is good and necessary, my only issue is the interest rate that we receive makes it hard to catch the faster moving Min Sum.

AK71 said...

Hi Ray,

You missed out the SA which attracts 4% to 5% in risk free rates, compounded, no less. At 4%, the SA pays 60% more than the 2.5% in the OA. :)

Remember that the SA's purpose is to help us meet our retirement needs better. The OA has a multitude of purposes. It is never going to be able to do what the SA does in growing our CPF funds for use in our retirement.

The SA is an important tool to make the CPF a cornerstone of our financial portfolio. We should use it if we want the CPF to work for us. Help the system to help ourselves. :)

AK63 said...

Since I'm reduced to my idling self and being a very unproductive element of our society again, let me work my hurting head and fingers abit just for mobility sake.... :)

Dear Lim LS....Right On! My sentiments exactly!! This government has hits and misses with all its policies, but the ones that irked me most are not the policies themselves, but the ridiculous and generalising reasons and excuses they employ to justify and defend the implementation of such policies. They have the highest-paid government officials in the world and yet they can only come up with....jokes? Haha, not funny!

From so many comments here, I feel like I'm on the fence watching a B grade movie unfolding. On the furthest end of this side of this fence, there exists a very deep and narrow well where so many frogs are hurling little pebbles out of their little well trying to score a hit on some other frogs in another very deep and narrow well on the furthest end of the other side of the same fence and vice versa. What do you think of the chances of a direct hit? Almost close to none.... Oh, don't worry about me, being kiasu and kiasee as usual, I am protected with body armor, sunglasses and an umbrella just in case some little pebbles decide to come my way, I would put on a condom too if my little fella feels threatened as well.... :p

Cory said...

I thought we already resign to the fact that CPF alone is not enough for retirement. My take is that it is a bonus pool and a basic baseline for everyone. And a "security" to the society to fund oneself. So whether i ever meet the min. sum is not essential as I prefer to leave them there till monthly withdrawal age. I will be tempted to withdraw if given the choice but that's the whole idea to prevent us.

AK63 said...

Dear Ray....

Our endearing AK71 has emphasised time and again financial prudence and helping the system to help ourselves, so what if MS is $500,000 or more? You're working and contributing already, I presume, and if you think the rate of growth in your cpf funds is not enough, there's always the other option of making yearly voluntary contribution of up to $7,000 and let compounding work its magic, or upgrade yourself to find a better job which commands a higher pay and make every cent counts towards your retirement goals. If AK71 can do it, so can any Tom, Dick, Ray & Harry, except those who have their own difficulties and limitations....

(Sorry to AK71 for hijacking your ideas and quotes, no ill intentions intended....)

Now, let's come to fruit picking, a trending pastime with many recently, and let's compare durians with chikus....

PRC girlfriends? What so bad about them? Why the need to steoreotype and generalise? Not all PRCs are bad, just like not all Roys are no-brainers and not all Rays are bright, right Ray or Roy? I have so many friends who have PRC, Thai, Viet, Malaysian, Indo, Myanmese, Pinay girlfriends or wives, none of them is sucking them dry (financially lah, not....maybe....?) :p

Gambling is bad. Or is it? Bad to who, you or me? It is definitely a big good to our little country's economy if those highly-paid minds think so. Think of the greater good - more jobs and opportunities for us all, more revenue for our country to pay our cpf interest, more funds to tap on to strengthen our country's infrastructures and bring prosperity to our people. What is this small minority which creates social problems as compared to the bigger picture?

Buying Prada is bad? Why? Retail spending boosts our economy, gives people more jobs, fattens the government's coffer, lets REITs pay you higher dividends, what so bad about that?

Buying a car that you don't need? You mean you you or you me? Other than those reasons above that are for the greater good, there are genuinely people who need a car, not those rich people who buy one car for every person in the family and different cars for every day of the week. So, you still think a person who waits until 55 to withdraw his/her cpf to buy a little car doesn't need it?

That's why I always ask people to come out of their little wells and see a bigger sky. There are people who can't afford many simple things in life. They work themselves to the grounds, if they can still work, trying to make ends meet. They look forward to their 55th birthdays so that they can withdraw a part of their well-earned well-deserved cpf monies in order to reward themselves for a little holiday somewhere for the whole family to enjoy and bond as a family. Is that too much to ask? It's their monies and they don't deserve it?

They are only asking for what's theirs to be given to them earlier. They are not trying to take yours. Have a heart. You are fine doesn't mean everyone else is. You can spout financial prudence and all that but there are real living examples of financial hardships around us. Be thankful for yourself but do not judge others just because you can and others can't.

Btw, if you are savvy enough, you would not keeping insisting on government to increase interest to help you grow your retirement funds. Even people like me who are definitely not savvy in many things can find ways to help the system help myself without asking for this or that.

If AK71 can do it, so can Rays and Roys.... :)

Ling said...

Hi Ak,
Prime minister direct email address can be found here:

so are all the singapore government officials.

AK71 said...

Hi Ling,

Thanks for this but I don't think I will send the letter to the PM. Haha... I have not said anything profound. :)

AK71 said...

In response to a comment in FB:

I don't see why being non-partisan should prevent me from commenting on policies which are in place and policies which are being proposed as well as the people behind them in the General Election.

I blog about the CPF and housing matters all the time. They are not things I suddenly chose to talk about because of the General Election.

I don't support political parties. I support policies which make good sense to me. If someone or some party has done something wrong, I say it as it is. Some might remember my open letter to PM Lee on the CPF and also my scathing response on the matter of MRT breakdowns.

As for the CPF, I am just a CPF member who has made the system worked for me. All I have done was to share how I did it and, hopefully, readers could see how it might work for them too.

This open letter to PM Lee was written last year in June before all the changes to the CPF were announced this year. Coincidentally, the government have addressed the three points I made in the open letter. :)

AK71 said...

Justice League:

AK, I am not your fan but occasionally just drop by to see your invaluable sharing with your followers on financial knowledge. On CPF, these are issues that bother me:

i) Our contribution is way too high. Using Hong Kong as an example since we are quite similar in terms of economy size, they only mandate min. 5% of their gross income for their Mandatory Provident Fund. By contributing so much, our domestic consumption actually shrinks a lot, not benefiting local biz.. There is also a qn of whether the return reflects the market return. See the below article for comparison (as it is 2011 figure, not reflective of current figures, but still a good analysis)

ii) . As the government borrows our money, they are the debtors. If we use majority of our CPF to buy a flat, it is like the debt is being paid back via an asset. If the asset is being inflated (which unfortunately it is), there is a risk that during deflation, our asset will be negatively affected.

So from the policy standpoint, we shd use as little as possible to purchase a flat since it is an asset. And the long term solution is to keep the housing prices affordable (how does HDB price their BTO houses?) so that we do keep much of our CPF for retirement. Again, one might want say the recent policies tend to trigger domestic-led inflation (import of foreigners, escalation of housing prices (bubble?) etc ).

Hi JL,

I hope you enjoyed your infrequent visits to my blog. wink emoticon

1. Well, given a choice, I would rather save more than less. If I am able to contribute more to a fairly safe savings program that is risk free and volatility free, I would. One year's numbers (i.e. 2011) is inconclusive. I believe that 2011 was when the world really emerged from the GFC. We don't invest for a year. We invest for decades. What about the down years? I manage my own funds and I know I did very well coming out of the GFC, outperforming CPF interest rates. Frankly, if you talk to people in Hong Kong and I have talked to friends in Hong Kong, they would rather have the CPF.

2. I agree wholeheartedly that Singaporeans should remember that the CPF is really meant for our retirement. We might have to use it for housing purchase but we must be prudent, keeping in mind the opportunity costs. We must be aware of the downside risks too. Unfortunately, people too often focus on the potential returns and the potential returns only.

Monthly Popular Blog Posts

Bloggy Award