[h=2]Hri Kumar: People will squander CPF money away[/h]
June 18th, 2014 |
Author: Editorial
During a CPF dialogue session organised by MP Hri Kumar at Thompson Community Centre last Saturday (14 Jun), Kenneth Jeyaretnam reported on his blog [Link] that MP Hri Kumar thinks by letting Singaporeans withdraw all their CPF money at 55, they will squander the money away.
MP Hri Kumar was reported saying:
In fact, this view seems to be shared by a certain segment of people in Singapore. Three weeks ago (27 May), our mainstream media also published a forum letter from its reader, Jason Soon Hun Khim, echoing the same view. Jason Soon wrote in his letter (‘Stop trying to link CPF returns to GIC returns‘):
The reader’s father was born in Singapore in 1933 to a hawker peddler who came to Singapore with his wife from Hainan, China. His father has worked at several jobs in his lifetime. By the time his father retired in 1988, he had been working for almost 40 years. He had always worked hard and never had a sick day or took an overseas holiday except to Malaysia with his family to visit relatives.
When the father turned 55 and retired, he took his money out from the CPF leaving behind the minimum sum and Medi-savings as required. The Minimum Sum Scheme was introduced in January 1987. When it was first started, members were required to set aside a sum of $30,000 in their Retirement Account when they turned 55 [Link].
After the reader’s father took out his CPF money, he took his wife to holidays outside Singapore as they had never been to other countries except Malaysia. In the meantime, the reader’s father recognised the money wouldn’t last him forever. He took on part time jobs while still having a holiday bi-annually with his wife. He stopped part time work altogether when he moved to Australia to join the reader nine years ago.
The reader described his father as not rich but has always been prudent. He is not highly educated but has always worked hard. He never attended any financial management course nor had he ever consulted a financial planner except to put in place some insurance when he was younger for the sake of his family. When his children became independent, he gave up the insurance policy, keeping only Medisave and Dependents Insurance scheme by CPF, none of which was compulsory.
The reader said his father has been surviving on his CPF savings and income from part time job for about 20 more years after retirement. He did not blow his CPF funds on women, wining or gambling. He continues to have some money and could buy little treats for his grandchildren and give gifts to his wife. He still enjoys travelling and takes little road trips with his wife around Australia. The reader also indicated that his father’s siblings are also all retired and had taken out what they could of their CPF funds. A couple of them still work part time. None of them have bankrupted their CPF savings in Batam or anywhere else.
The reader thinks that the majority of elderly people in Singapore are like his father and his siblings.
“They have been working hard and raised their families. They know all about living within their means. They have lived for many years and gone through many trials in their lives and know how to make good and responsible decisions. They are mature enough not to have illusions of their golden years nor their health,” the reader said.
“Rather than hold their CPF money to ransom because of the few who might blow it all in Batam, shouldn’t the government return choice and responsibility back to our mature citizens? Why stop the elderly from enjoying their later years after they have worked so hard for so long? Why take away their dignity to live a life they want?”
The reader’s father is 81 years old this year.
Over on TRE, other readers also disagreed with MP Hri Kumar’s comments:
During a CPF dialogue session organised by MP Hri Kumar at Thompson Community Centre last Saturday (14 Jun), Kenneth Jeyaretnam reported on his blog [Link] that MP Hri Kumar thinks by letting Singaporeans withdraw all their CPF money at 55, they will squander the money away.
MP Hri Kumar was reported saying:
“Letting us withdraw our CPF at 55 would lead us inevitably to squander our money. If this happened then other taxpayers would have to pick up the tab for supporting them.”
Kenneth himself was at the dialogue session on Saturday.
In fact, this view seems to be shared by a certain segment of people in Singapore. Three weeks ago (27 May), our mainstream media also published a forum letter from its reader, Jason Soon Hun Khim, echoing the same view. Jason Soon wrote in his letter (‘Stop trying to link CPF returns to GIC returns‘):
If the full CPF balance is returned to members at age 55, some may squander away the funds and fall into the poverty trap. Government welfare systems would be needed to take care of them and taxes will have to be raised to fund the schemes. Would the working population accept this? Is it sustainable?
Criticizing this argument on his blog, Kenneth said:
There is NO EVIDENCE to support the claim that most people would not be able to manage their savings responsibly.
Most pension systems, particularly those praised by the Mercer Global Pension Index Report, such as Denmark, the Netherlands, Australia, and the UK allow beneficiaries to take some or all of the pension as a lump sum on reaching retirement age, or often at age 55 irrespective of the total value of pension assets.
Rather than squandering, the Global Entrepreneurship Monitor found that people in the age group 55-65 are more likely to start a new business in a high- tech field than other age groups. So not allowing those reaching 55 to take part of their CPF in cash could be holding back the whole economy’s productive potential.
It does not necessarily follow that people squandering their CPF payouts would outweigh those investing them productively for better returns than CPF provides.
A TRE reader also wrote in to share the story of his father who responsibly manages his CPF money upon retirement (‘An unhappy tale of a responsible old man & his CPF‘).Most pension systems, particularly those praised by the Mercer Global Pension Index Report, such as Denmark, the Netherlands, Australia, and the UK allow beneficiaries to take some or all of the pension as a lump sum on reaching retirement age, or often at age 55 irrespective of the total value of pension assets.
Rather than squandering, the Global Entrepreneurship Monitor found that people in the age group 55-65 are more likely to start a new business in a high- tech field than other age groups. So not allowing those reaching 55 to take part of their CPF in cash could be holding back the whole economy’s productive potential.
It does not necessarily follow that people squandering their CPF payouts would outweigh those investing them productively for better returns than CPF provides.
The reader’s father was born in Singapore in 1933 to a hawker peddler who came to Singapore with his wife from Hainan, China. His father has worked at several jobs in his lifetime. By the time his father retired in 1988, he had been working for almost 40 years. He had always worked hard and never had a sick day or took an overseas holiday except to Malaysia with his family to visit relatives.
When the father turned 55 and retired, he took his money out from the CPF leaving behind the minimum sum and Medi-savings as required. The Minimum Sum Scheme was introduced in January 1987. When it was first started, members were required to set aside a sum of $30,000 in their Retirement Account when they turned 55 [Link].
After the reader’s father took out his CPF money, he took his wife to holidays outside Singapore as they had never been to other countries except Malaysia. In the meantime, the reader’s father recognised the money wouldn’t last him forever. He took on part time jobs while still having a holiday bi-annually with his wife. He stopped part time work altogether when he moved to Australia to join the reader nine years ago.
The reader described his father as not rich but has always been prudent. He is not highly educated but has always worked hard. He never attended any financial management course nor had he ever consulted a financial planner except to put in place some insurance when he was younger for the sake of his family. When his children became independent, he gave up the insurance policy, keeping only Medisave and Dependents Insurance scheme by CPF, none of which was compulsory.
The reader said his father has been surviving on his CPF savings and income from part time job for about 20 more years after retirement. He did not blow his CPF funds on women, wining or gambling. He continues to have some money and could buy little treats for his grandchildren and give gifts to his wife. He still enjoys travelling and takes little road trips with his wife around Australia. The reader also indicated that his father’s siblings are also all retired and had taken out what they could of their CPF funds. A couple of them still work part time. None of them have bankrupted their CPF savings in Batam or anywhere else.
The reader thinks that the majority of elderly people in Singapore are like his father and his siblings.
“They have been working hard and raised their families. They know all about living within their means. They have lived for many years and gone through many trials in their lives and know how to make good and responsible decisions. They are mature enough not to have illusions of their golden years nor their health,” the reader said.
“Rather than hold their CPF money to ransom because of the few who might blow it all in Batam, shouldn’t the government return choice and responsibility back to our mature citizens? Why stop the elderly from enjoying their later years after they have worked so hard for so long? Why take away their dignity to live a life they want?”
The reader’s father is 81 years old this year.
Over on TRE, other readers also disagreed with MP Hri Kumar’s comments:
Brandy: This f**king b**tard can claim that if given our cpf $ by 55, then we squander it in casino or batam. Who is the f**king b**tards who voted and approved the building of the casinos? And did the females also squander their cpf $ in batam including ALL males? Bloody f**king b**tards.
PGL: Why ***** assumed all Sinkapooreans are gamblers and they still have high sexual drive after 55? He should provide statistics on number of Sinkapooreans squander their CPF $ at the casino or trips to Batam (to buy kuey lapis? I don’t think he meant that) to support his claim. If the number is 1000 then why let 1000 people affect the life of few million people?
Inevitably, an Idiot: This argument is a non-sequitur. Let’s be realistic: under the current PAP regime, the government will NEVER EVER EVER pick up the tab for any public welfare for stupid people who squandered their money away. So, taxpayers will in fact, not have to bail anyone out. If welfare money starts getting into the hands of impoverished retirees, it would mark an earth-shattering change in the PAP’s welfare policy.
And Hri Kumar, please look up what “inevitable” means in the dictionary before you start using it anyhow.
Ali Kumar: It is Stupid to say people will use the CPF money to squander away the money go to Batam. Why having such negative thinkings. People may want to use the CPF to invest or run a business… Vote for change then we can have our CPF withdrawal at 55 years old.
PGL: Why ***** assumed all Sinkapooreans are gamblers and they still have high sexual drive after 55? He should provide statistics on number of Sinkapooreans squander their CPF $ at the casino or trips to Batam (to buy kuey lapis? I don’t think he meant that) to support his claim. If the number is 1000 then why let 1000 people affect the life of few million people?
Inevitably, an Idiot: This argument is a non-sequitur. Let’s be realistic: under the current PAP regime, the government will NEVER EVER EVER pick up the tab for any public welfare for stupid people who squandered their money away. So, taxpayers will in fact, not have to bail anyone out. If welfare money starts getting into the hands of impoverished retirees, it would mark an earth-shattering change in the PAP’s welfare policy.
And Hri Kumar, please look up what “inevitable” means in the dictionary before you start using it anyhow.
Ali Kumar: It is Stupid to say people will use the CPF money to squander away the money go to Batam. Why having such negative thinkings. People may want to use the CPF to invest or run a business… Vote for change then we can have our CPF withdrawal at 55 years old.
