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8/01/2011

Medisave double speak

Medisave Minimum Sum

The Medisave Minimum Sum is the amount you need to retain in your Medisave Account whenever you make a withdrawal of CPF savings (e.g. at age 55, 56, etc). The Medisave Minimum Sum will ensure that you set aside enough savings to meet your future healthcare expenses. The Medisave Minimum Sum from 1 July 2011 is $36,000 and is adjusted every July of the year.
Medisave Required Amount

The Medisave Required Amount (MRA) refers to the amount you are required to set aside in your Medisave Account after meeting the CPF Minimum Sum requirement. If you have met the CPF Minimum Sum and have a MRA shortfall at the point of withdrawal, you are required to make a top-up to your Medisave Account with part of the balance from your Ordinary Account and/or Special Account to meet the prevailing MRA.

The MRA is set at $27,500 from 1 January 2011 and will increase by approximately $2,500 (to be adjusted for inflation) each year until it reaches $25,000 (in 2003 dollars) on 1 January 2013.

The above is quoted from the CPF online site. How many of you understand what they mean? One point to note is ‘minimum’ which means that they can make you pay more than this, or take more money from you to be locked up. My Medisave saving is now more than the $36,000 minimum and growing. And this taking money from the people to be locked away, hopefully you have a beneficiary to pick them up when you are deleted, the money will go to the govt’s charity.

Read MRA above carefully. It said it is the amount to be set aside after meeting the Medisave Minimum Sum of $36k at this point in time, and this MRA to be set aside is $27.500. They could technically make a CPF depositor set aside $36k + $27,500 or $63,500, and growing every year.

How much money is kept away from the people by this scheme? At 36k per head, at 2m contributors, that is $72b! This is money that rightfully belongs to the people and must be returned to the people. Under the present scheme, even after 62 or 65, or 70, depending on how far the goal posts are shifted before you can get your monthly pittance from the CPF Dispensary, this money in the Medisave still cannot be touched. This is definitely a violation of human rights, when the people’s money is taken away from them, oh, ‘for the people’s good’, so they said.

Just for this reason alone, it is good enough to vote for another govt to make this withholding of the people’s life savings illegal. At the moment it is legal because the people voted them to Parliament to make this legal. How silly can the people be to vote a govt to take their life savings away from them when they need it?

There are many other things that are legal today that should be made illegal by a govt of the people and for the people. I am waiting and will definitely vote for another govt that will make these illegal and return the money to the people.

Why vote for a President to protect a reserve that we do not know? The people should be voting for a President or govt to protect their life savings in their CPF, to be returned to them when they need it, to be returned to them when they are alive, and not when they are dead.

What is the point of going for a heart by pass at 70 or 80 because one has some money in the Medisave, to be kept alive and penniless in old age? Would it be better to spend the money, enjoy a bit of life, and just let old age and the wear and tear of the body take one’s life away, and live more comfortably, even be an emperor for a few days with one’s own hard earn money?

22 comments:

Tau Suan said...

I left a logical and reasoned comment on Medisave. How come it was not published ?

Anonymous said...

Hi Redbean,

Your article are normally too brief for logical senses. But I love this article very much as you hit the logical nails to articulate my brain waves.
Much appreciated!

Chua Chin Leng aka redbean said...

Hi Tau Suan, Welcome to the blog.

Something sticky. I saw your post appeared and disappeared. Please try to post again.

Cheers.

Anonymous said...

It is not sticky. Few of my previous also disappeared from your website. I hope you are not exercising self-censorship on your blog?

Anonymous said...

If people can say that even corruption can be legalised, what is there about anything illegal that cannot be made legal?

Chua Chin Leng aka redbean said...

Hi anon, this is perhaps the freest blog that one can find on singapore news.

I am very proud of all the contributors here as i have no need to exercise any censorship other than out right vulgarities.

The only blogger that I had to delete some of his posts was matilah singapura. And when I did, I will say so.

And I encourage contrarian views So you can be sure that your posts were never deleted by me.

This is the least that I can guarantee here.

Cheers.

Anonymous said...

I'll drink to that, redbean.

Some bloggers do not tolerate alternative views and when people disagree with them they claim that those are personal attacks.

You will be surprised how petty some bloggers can be. Of course, looking into the mirror, they do not see that as petty behavior. And I am talking about fairly known people hor, not small unknowns.

Anyway, such pettiness drives away readers. What is the point of just agreeing without being able to put forward alternative comments? Does that blogger sound like he is taking a leaf from the PAP?

But the fortunate thing is that there are many other well known seasoned and popular bloggers who can tolerate differing viewpoints without feeling personal about them. That is good.

Chua Chin Leng aka redbean said...

Hi anon 11:01,

Writing blogs cannot be too long. Can be very tiring for the readers. I always try to be as brief as possible, just covering one or two key points.

Cheers.

Anonymous said...

rex comments as follows,

redbean, i think your interpretation of MMS and MRA is incorrect. There will never be an occasion for you to add MMS to MRA to get $63,000.

I was very puzzled about MMS and MRA but the confusion cleared when i read an example calculation in the cpf website.

You see, MMS Medisave Minimum Sum Actually means Medisave MAXIMUM sum. It is max of $36K whcih you ever need to keep. It means that anything in excess of the max. $36K may be withdrawn.
On other hand MRA Medisave Required Amount, is really really the Minimum sum. That is to say, die die, (pun unintended), your Medisave balance CANNOT drop below $27,500. At any time if it drop below $27,500, CPF robots will transfer money from OA to top up WITHOUT TELLING YOU. that's what minimum sum means, you MUST have minumum of $27,500.

The 36K is really a maximum sum, beyond which you can take out the money.

Between these two figures, when the top up haven't quite reached 36K, you also may not take out the money.

that is my understanding.

The bloke who designed these stupid rules should be sent to changi prison for confusing the masses.

rex

coconut juice said...

Vote for a President "who returns you the money when you want it, when you need it ?" Isn't what the medisave is doing exactly now?

You also want a govt who returns you All the money when one retires, say 55, 58 or 60 years old ? What happens that person lives till 80 and by the time he is 63 years old, he has already lost All the money through gambling or bad investments ? And when that happens, who is going to help this poor chap ? That is very bad economics and luckily, our govt still have their heads firmly screwed to their necks.

Chua Chin Leng aka redbean said...

Hi rex, and welcome to the blog coconut juice. Let me try to reply to both of you together.

The confusing part is minimum becomes max and the MRA becomes min. I will be happy if you are right. Unfortunately my Medisave has more than $36k, which means min sum is minimum sum and not max. I just wrote to CPF on this and told them that I will post their reply in my blog as it is of general public interests.

To coconut juice, the majority of the people are not going to live to 80 or 90. the majority of the people are not going to squander their money away on gamble in the casino.

The majority of the people must not be held ransom by this self serving reason that because a few will get into trouble and everyone's money must be kept away form them.

As to how to deal with a few bad cases, that is the problem of the govt and depending on their values, religion, upbringing, they will have to formulate policies to deal with them.

They are not paid millions to sleep on these problems or pass the buck to the people, and the easy way out, hold back everyone's money like their grand father's money. This is morally wrong.

They are the govt, they solve the problem, but not holding the rest of the population in ransom.

The people must vote out govt that stoop to such self serving policies.

rex said...

rex comments as follows,

yes, i am quite sure i am correct. If you have say $38,000 in your medisave, i am very sure, you can withdraw $2,000, because it already max-out at $36,000. Please read the example calculation shown in the cpf website, it is very clear.
What is not clear is the stupid wording "MMS" and "MRA"
I gave up trying to tell CPF that they are wrong. The govt never admits they are wrong. At most they say "we note your proposal" and end of story.
And yes, i agree with you, that there is no reason to hold back 100% citiznes money just because 10% will squander the money.

What we need to fight for is the RIGHT to withdraw our CPF on our own Terms. It is not the same as to fight to WITHDRW our CPF. Actually i don;t mind leaving the money in the CPF. But i want the RIGHT to be able to withdraw. It is immoral, illegal and cruel to hold back what is morall, legally ours in the first place.
How on earth we civilised singaporeans arrive at such a sorry state. No one even cares about it as if nothing is special.

rex

Anonymous said...

If a person does not know how to manage his money at 55 years old, it's unlikely that he can do so at age 65.

The CPF money should be released back to all of us in full at age 55 years.

If the CPF money belongs to me, then I should be free to do with it as I please.

And that includes the right to lose all of it in a bad investment.

Isn't there a famous lady elite who has a long history of making bad money investments involving billions of dollars?

Why is she still free to commit financial acts of self destruction?

coconut juice said...

How do you know the majority are not going to squander the money away ? If not, why would people want to propose taking all out in the 1st place? It is because they want to spend it.

No need to live until 80. One can lose that $35k or $38k in 1 day or 1 month of spending. Let me ask you, if the govt let the genie out, open the floodgates (which cannot be closed), and later realise people have spent and not enough or no money for medical, who is going to be responsble? You may be responsible in money, but your neighbour may not, are you willing to help him pay for his indiscretion, through higher indirect taxation on you ?

Anonymous said...

"This is definitely a violation of human rights, when the people’s money is taken away from them, oh, ‘for the people’s good’, so they said". Unquote.
So is conscription a violation of Human Rights when a professional fighting force is within our means!

Chua Chin Leng aka redbean said...

Hi coconut juice, there are two key issues here. One is the fundamental right of ownership. What is yours must be yours and no one can take it away under any guise or excuses.

Two, and this is very dangerous, is to accept anyone's fallacious theory and let it become a justification to take away the rights of an individual or his property. As an eg, the same kind of example, that people are callous and irresponsible, so all the children must be taken from their parents and placed under the care of the state.

Or to push the same CPF argument, since people will anyhow squander their money, why just keep their CPF savings, why not forfeit all their savings in their bank accounts? It is good for them, before they squander their money away.

Basic and fundamental rights of an individual cannot be violated by the state or any individual who have usurped the authority of the state.

NS is a violation of an individual's right. True. Between sacrificing some of our rights to do NS and letting the state keep our money, which is more atrocious, unacceptable? I think in the case of NS, the people could accept the rationale and are willing to sacrifice some of the time for the country. Some may even die for their country. But such values are laughed at today, by those who are too smart and self serving. They regard such people as daft.

The state will every now and then impose regulations and laws to restrict the rights of the people. Some acceptable some not. The people must make their stand when the state over intrudes into the people's right. If not, the people deserve the govt they elected and deserve to have their rights violated or taken away from them, even their life savings.

cocnut juice said...

Who takes it away ? The govt ? It only requires that u keep $36k or whatever amount for one own's medical, it actually is not a lot of money, is perfectly logical and reasonable. It is YOUR money, Lol, you can USE it to pay medical.Lets be reasonable. For the money in our total reserves, and that is the bedrock that keeps S$ strong. Strong means you can go overseas buy things and travel cheaply.

Or is Australia better? They have no Cpf wahtever, they tax everybody same at 40-49%. Singapore tax is way below, most dont even pay any tax !! How did we do that ?? So who is taking ownership from who ? Or US is better ? No CPF too, but got unemployment benefits. Is better ?

Anonymous said...

Anywhere there is land to roam free and cultivate ones' own food is DEFINITELY better.
Any place one is forced to do anything, from protecting others to the forfeiture of use of ones' own money is BAD. Just common sense!

coconut juice said...

Like a farmer ? Maybe Malaysia land is cheaper, you can do that. But here land is scarce how to ? Unless migrate to Malaysia?

Our neighbouring countries taxation are all higher. So in a way, they also forfeit your money, thats for real, and even more, and never to return !!

So in a way, where got common sense, where got "human right", to borrow from redbean phrases.

Anonymous said...

In Sin, we can't talk abt Human Rights nor is there any use for commonsense. They are all being hijacked, if U understand.

Chua Chin Leng aka redbean said...

Blimey, we are all so ignorant. There is a new term called MCC, mong cha cha in cantonese. This is the Medisave Contribution Ceiling which now stands at $41k and also subject to annual upward review.

Now they are encouraging the oldies to delay withdrawing their CPF with a carrot of 2% additional interest. I am asking them would the money left behind that can be taken out after 62, and the additional interest paid after one year, be transferred to the Medisave Account when the MMC or minimum sum is raised annually.

If so, it is like a death trap. They give you 2% interest but can sapu more of your money into the Medisave acct for good.

This is another brilliant scheme to take your CPF money from you. Now I am waiting for their reply on this. I think it is safer not to be tempted by the 2% and ended up can be happy reading the CPF statements but cannot touch.

See only. Not really your money.

Anonymous said...

Hi all,

Question 1, whose money is it in the CPF?
Answer : your own money....
Question 2, who has the right to the money?
Answer : You

Question : why is the government holding it and extending rights to withdrawal?
Answer : because we have more people with coconut brains voting for a govt that has not been transparent with the nation reserves....

Last, are we sure the figures adds up to what the reserves should be.....?
Answer: people accepts these figures without doing proper calculations and those who do cannot get transparency of records to verify these figures ....

Sorry another last question: How to know whether the reserves adds up?

Answer : Vote for more opposition members and only when we have a new administration will transparency be available.