A Regular Singaporean Teaches Roy Ngneng What Is The Real Heart Truths


My Heart Truth:
I am a 30+ years old male who is living in Singapore. I contributed CPF monthly, although I feel the “心痛” sometimes to see 20% of my income not coming to my bank account.

Frankly speaking, I don’t understand why there is such a big fuss about “Return our CPF”

When my dad was 55 years old, he got a rather huge CPF lump sum payment, which unfortunately he squandered it away soon. That’s why I advocate better financial literacy and partial release of the monies rather than a lump sum. It has been proven that when one is being given a lump sum of money, this does not means that they are better well off as they are unable to cope in handling this sudden amount of money.

I converted his Retirement Account to CPF Life, which now pays him a regular sum of money monthly. This is useful as he was being laid off 2+ years back, and I think the monthly sum is enough for his daily expenses. He has no other financial commitments such as house, car etc anyway. Without the CPF scheme, many elderly in Singapore may not have the luxury of having this ‘monthly allowance’. Oh yes, the G should provision for them, you might argue. Look at those nations that done that, and what are the tax rates and the financial situation of those countries.

On top of CPF MediShield, I bought MediShield enhanced & Rider (100% coverage) for my family for hospitalization. Some of these policies are being paid for my CPF, so I do not need to worry about the premiums.

So end of the day, CPF is being returned to you – one way or another. Thus, I am unable to understand how come some of the elderly are supporting the call for “Return our CPF”.

CPF is in a way – ‘forced savings’, where the money can be used for certain purposes. When I bought my HDB flat, the downpayment are done using my CPF OA. Without the CPF scheme, how would I be able to afford the 20% downpayment in cash?!

However, end of the day, we have to exercise rationale and common sense – that is to spend what you can afford to. Why do I say so? I am seeing amongst some of my friends, getting EC, Condos, fancy cars, and then complain that they have no money, and no one is helping them. Perhaps they bought it out of necessity, but my observation is that most got it out of ‘face’ – to show that they ‘can afford it’. However, most of the time, it could be over within their means , and the purchase is done without any financial prudence in their spending. Then they complain that the CPF/money is being wiped out when they could have spend a lot lesser!

Buy within your means. Upgrade when you can afford to, not when you WANT to. Think of our parents and fore-fathers. I believe they are able to achieve what they have now as they exercise prudence when they are at our age. Do they care about ‪#‎YOLO‬, “Spend now, think later”? No! Unfortunately, we have been too spoilt and pampered that our floor of simplicity is not that simple anymore.

 Source: https://www.facebook.com/jerrylim/posts/10152974558722960?fref=nf

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