Sort out the CPF mess

The CPF has become a mess. Although the members put in a lot of their savings into CPF, it is not able to produce an adequate retirement income for members.

The rules on the use of CPF for housing and the access to grants are extremely complicated.

What can be done to sort out the mess?

Here are my solutions:

a) Simplify the CPF rules. Fix the contribution by employer and worker at 20% each. Do not vary according to age.

b) Allow the member to use his own contribution for rental or purchase of a house. Remove all the restrictions regarding the tenure of the leasehold.

c) The employer’s contribution is to be used solely for retirement. Allow members to invest in approved funds with low expense ratio or to keep in CPF to earn an interest rate of 4%.

d) Remove the Medisave account and transfer the money to the Special Account. Introduce a single payer scheme largely funded by taxation and keep the co-payments at a low level. Wind up the existing insurance schemes.

e) Allow members to take out all of the retirement savings at 55, but give them attractive options to reinvest the savings in a life annuity or a fixed annuity with payouts over a fixed period. Employ mentors to advise the members on their financial planning.

It may take many years for this mess to be sorted out, but we should have a clear idea about the ultimate scheme.


Tan Kin Lian



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9 Responses to “Sort out the CPF mess”

  • patriot of TUMASIK:

    Hello Tan Ahhh!!! it is a MONEY PRINTING MACHINE leh!!! change the govt and the changes can be MADE by then it may be too LATE…the Vault is EMPTY and the Bird has flown or Run Road if no have wings

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  • Asd:

    Big failure…
    Solution is to tell you rent room… sell lease… eat less… use free wifi… do excercise at mrt to get free ride… while people take and take m$ for such idiotics

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  • RDB:

    The kind of beholden ministers so abundantly over well paid will have the guts and care for fellow working class Singaporeans is it.

    Have not they already shown they are more interested in? So richly rewarded for their allegiance to their master the PM!

    Wore betide them if they ever desert their allegiance for wealth!

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  • James Lee:

    Well said!!!
    Meanwhile,as a gesture of their appreciation and gratefulness to all senior citizens, the government of the day should help boost the standard of living of these individuals including PGs and MGs who are struggling to live- out their remaining life span by implementing without any further delays the following measures:-

    1)Provide without conditions,free basic hospitalisation and health care to all PGs and MGs. The government can save on subsidies and medisave top ups.The moneys in the medisave accounts of these senior averaging S$40,000 can therefore be released to meet their retirement needs.

    2)Pay to all these seniors a monthly sum of S$500/=

    3)Issue free Singapore Passport to all seniors.

    Please do the needful before its too late!!!!

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  • SG C.servants don't understand:

    The rules on the use of CPF for housing and the access to grants are extremely complicated.

    Such is how Civil Servants without exposure to competition and the need for efficiency functions. Convoluted rules in the private sector will drive away the customers. Alas, those million-dollar SG civil servants don’t understand that.

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  • Fr [email protected] to Frankenstein:

    Agree with TKL!
    CPF and retirement used to be so simple and sweet.
    We used to have to work till 55 and then get to enjoy.

    Now, it’s a nightmare.
    Recently, 47% of a retirement cohort could not meet the retirement sum to get mthly payout.

    Singaporeans can muck books well. Even these typically have not understood the cpf policy of today. It’s like a FINANCIAL PRODUCT tweaked and tweaked until it’s no longer recognisable . It’s become a complicated monster . A Frankenstein.

    Any decent design grad would tell you , when something is changed and changed until it’s too complex, it has a fundamental design issue.

    It’s unlikely to be sustainable over the next 50years.

    Singaporeans approved and accepted the leaders and policies , mostly out of fear and ignorance.

    So they are also the culprits. The majority sabo the minority.

    In any society, the majority cannot be wiser than the minority who are the wiser.
    The wiser always exists in a minority number.

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  • Singaporean Lost Soul:

    Giving back your CPF money at age 55, mean these white bast**d has nothing to milk for their big fat salary. they must hold on to your money, they take more U take less. U R the master n they make U struggling for your money. these white bast**d even dare to said the master spend their money in Batam, They mean every master. One rotten apple spoil the whole barrel.

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  • Harder Truths:


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  • Memo for Mr. Tan:

    Sir,you might wanna check out what the Aussies do for themselves asfar as superannuation goes.

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