Totally illogical to suggest CPF payout term of 28 years where there is no one to receive balance payout

by Zol

I was born in the year 1954. I am 65 years old this year and I empathise with all who had commented here on The Online Citizen.

I would like to share my own ordeal with fellow CPF members.

Like the others, I had received a letter from CPF informing me to either apply for a monthly retirement payout at 65 years old, or delay it to 70 years old for a better payout sum. This was nothing new as it had been reported in the news and critiqued by many SIngaporeans including an ex-PAP MP Mr Inderjit Singh. However, the one thing that shocked me was that I could only receive $482 monthly from June 2019 under the CPF Retirement Sum Scheme, and this payout would last about 28 years, when I would be 93 years old.

How can the Central Provident Fund Board decide on the terms of payment for my own money? I would like the Finance Minister to clear the air – does CPF savings belong to each individual member?

I then wrote in and requested for a 20-year payout so as to increase my monthly payout, the reason being Singapore’s life expectancy was 85.4 years (based on statistics reported in the media.) The CPF simply rejected it and cited “current policies” as the reason.

And we members were never consulted. However, if you search the CPF website on “CPF-Your Assurance in Retirement”, this article states that “…. you can choose your desired amount of monthly payouts to meet your retirement needs…”.

How did their action reconcile with the statement?

As I am married with no children, I need to support myself from now till death. If I can not secure a job from now till 70 years old, what do I survive on during this 5-year period if I opt in at 70 years old? On top of this, the 4% interest may not even cover inflation in Singapore and the progressive increase in GST for now is 7% to 9%. If using present value to evaluate the 2 options (ie. start the plan at 65 or 70 years old), the best decision is to withdraw all my CPF money now.

In light of my situation (ie. married with no children), it is totally illogical to suggest a payout term of 28 years. When my wife and I pass on, there is no one to receive my balance payout.

I also understand the stand of our Government to refrain from giving out any money for free. I am not asking the Government to feed me. Because in my case, even if I use up my CPF retirement sum by the time I am 85 years old, I still can sell my 5-room flat (if the value is not zero) to support myself without anyone’s help.

Is there a need for the CPF Act to keep changing without consulting the CPF members? Bear in mind that the CPF Board is a Government Statutory Board which is supposed to serve all Singaporeans. Instead, it is acting like a regulatory body in charge of all Singaporeans’ hard earned savings. The CPF Board can at their wimp and fancy change the policies without consulting the members.

Let’s get our facts right:

  1. CPF is only a custodian of members’ CPF savings. That means the money belongs to the members.
  2. CPF savings is supposed to help members save for their old age. The initial age was 55 years to withdraw full lump sum.

These are facts which no one can challenge. Then why make changes to the CPF Act without asking the members? A referendum is the correct and democratic way to give members a say in accepting the new CPF policies or otherwise. Any CPF policy can not be fixed or approved by the CPF board of directors because they are merely custodians of our monies and they do not represent all Singaporeans.

I am also puzzled why none of the political parties or existing MPs who are supposed to be our voices stand up and comment on this issue? I presume with a monthly salary of $16,000, they are unlike common folks like us who need the monthly payouts to live.

In conclusion, I am voicing this out and hope Singaporeans can have a say in this issue once and for all.