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Myth 117 Is CPF a saving scheme for retirement? After saving for a life time at between 33-50% of a person's income, many Singaporeans ended up with little money left in the CPF for retirement? How can that be? Where have all the money gone to? In the first place housing eg a 4 room HDB flat, will take away between $200k to $300 for a 20 year instalment plan. A person who contributes $1000 to the CPF a month will find the bulk of his savings going to the flat. How could there be excess savings when flats are priced according to affordability, which means how much the buyer has in his CPF saving. Now we have a better scheme called Medisave. But before anyone can save enough, there are all kinds of great schemes to spend this money. There are insurance schemes for self, for spouse and for children. This is another effort by the govt to plan for the people using their CPF money. Very laudable. But how much money will be left for retirement? Retirement is a time to spend money on self to live a more carefree life, not just about paying expensive medical fees to struggle to be alive. People will die and it is a natural way of saying that the body cannot take it anymore. Nothing to cry about when it is time to go. The artificial extension of life is not necessarily a good thing as it is against nature. What would be better is to make CPF and Medisave a voluntary contribution after 55. Medical insurance can be made compulsory up to 60. After that the people must have a life of their own to decide for themselves what is good for them. How can the govt compel the people with so many compulsory schemes even at their twilight years? Let the people be free to be themselves, to do what is right for themselves with their money when they are old and a little wiser. Can the people be allowed to be free during the last lap of the lives? Let's not treat the people as children for the rest of their life, to be managed, controlled and legislated on how to live their life. What govt control? Never heard of it. The govt is all doing for the good of the people, taking care of the people with the people's own money. Even after providing for their medical insurance, they still have to keep a large chunk of their money in Medisave till they die.


Matilah_Singapura said...

>> Is CPF a saving scheme for retirement? <<

No, it is actually a TAX, manipulated in such a way as to appear to be a form of "savings".

In political theory (and practical application) there are many sneaky ways in which The State attempts to manipulate the minds of the Sheeple. One of those ways, was pointed out by George Orwell in Nineteen Eighty Four (1984) when he referred to Newspeak.

Essentially it is this: The State changes the way words are used, and The Sheeple get hypnotised into believing the new "meanings" of the words. Examples: Instead of calling it "slavery", The State calls it "national service". Instead of calling it "brainwashing children", The State calls it "public education". After sometime, the public get used to this and willingly submit their minds and free choices to The State, which over time increases its power and influence over the lives of the people, and their country.

>> After saving for a life time at between 33-50% of a person's income, many Singaporeans ended up with little money left in the CPF for retirement? How can that be? Where have all the money gone to? <<

The money (if you can call it that — see Newspeak) doesn't "go anywhere". It is re-distributed in the economy — usually to fund grandiose projects The State decides to do, usually by The States own "private" (see Newspeak) corporations.

Strictly speaking, the world doesn't use "money" any longer. That all ended 36 years ago in 1971 when the gold-backing of money (paper money was actually gold-substitutes, i.e. "receipts" for a specified weight of gold) was removed by Richard Nixon and replaced by a system of relatively valued fiat currencies — pure paper money backed up by "hope" mostly.

With paper money (currency), over time the PURCHASING POWER diminishes, such that if you simply save your money, you will end up in the future POOR because the purchasing power of your saving will have fallen dramatically.

So the hapless citizen loses big time:

1 He loses his country and his freedom to The State

2 The State forcibly extorts his private property (Tax) produced by the hapless citizen by labouring all his life and The State tells the citizen that this process is "forced savings", and even presents him with a periodic account of the citizen's "contribution". (Newspeak all the way!)

3 The money taken off the citizen is used to boost the power and influence of The State by The States very own "private" corporations, which participate in the free-market. The profits made by these "private" corporations are retained by The State to dispose of at whim, and the hapless citizen is paid a paltry 2% (or thereabouts) and told by The State to "work harder" and "increase productivity".

4 The money in the citizen's "account" decreases in purchasing power over time. Inflation in the best of cases runs at 3%. Since the 1990's the US Federal Reserve has been incrasing the US money supply (by simply printing more paper currency) by around 10% per annum. The central banks of nation states themselves inflate on the back of US Dollars, which is the de facto global "reserve currency". All this time The State of Singapore "pays" the hapless citizen a return of around 2% in his "account" at the CPF office. So the citizen is being screwed good and properly.

After a lifetime of hard work, the citizen asks: Dude, where's my money?
By that time he is too old and too worn-out to fix it, and perhaps in desperation and in a state of depression contemplates a trip to the nearest MRT station to jump in front of a moving train.

redbean said...

orwell is a visionary. now i can say that comfortably without guilt.

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