Enye Hypersonic September 20, 2012 Share September 20, 2012 (edited) No need to save cash from your monthly disposable income for retirement anymore...woohoo govt say wan no need multiple income streams, investment etc life is so simple i got it wrong all this while... better start spending since CPF can provide me 71% of my pre retirement income even after paying for housing YOUNG Singaporeans starting work today will have enough savings in their Central Provident Fund (CPF) accounts to retire comfortably in their golden years, says a study commissioned by the Manpower ministry. They would have accumulated CPF savings that will give them a comfortable level of income in retirement - a level equal to a large part of their pre-retirement earnings, it says. Deputy Prime Minister Tharman Shanmugaratnam, giving a preview of the findings, said, however, that the CPF balances of older workers will be inadequate, although most of these individuals would have gained from the rise in the value of their homes, courtesy of government subsidies, earlier withdrawal of CPF savings and economic growth. "Our strategy is to help them monetise the values of their homes in retirement if they wish to," said Mr Tharman, who is also Finance minister. He was delivering a keynote address at the opening of the Singapore Human Capital Summit conference. The study he was referring to was done by National University of Singapore professors Chia Ngee Choon and Albert Tsui. In their study into whether the CPF system adequately meets retirement needs, the professors computed what economists call the income replacement rate (IRR), which is the ratio of retirement income to pre-retirement earnings. Using all CPF savings acccumulated by a worker up to the age of 65, including savings above the CPF Minimum Sum which the worker can withdraw at age 55, they found an IRR of 71 per cent for a median male worker who starts working today. The female median worker's IRR is 63 per cent. These IRRs factor in only the cash savings in the CPF; they exclude the benefits the worker gets from owning a home. "These IRRs are within the recommended range by the World Bank, which is between 53 per cent and 78 per cent," Mr Tharman said. "They are also comparable to those seen in pension systems in many developed countries." The equivalent IRR in the median country in the OECD, the league of rich nations, is 66 per cent of pre-retirement earnings, while the average among the OECD countries is 72 per cent. Mr Tharman pointed out that Singapore's IRR is even higher when its near-universal home ownership - under which homes are fully paid by the time workers hit retirement age - is taken into account. "By not having to pay for rent, cash is freed up for other living expenses in (the workers') old age," he said. With workers who are already older, however, he acknowledged that their CPF balances will be insufficient for three reasons: their wages were much lower in the past; they were required to set aside less in their CPF retirement account; and the fact they could use much of their CPF savings for housing. The study found the IRR to be lower for higher-middle earners because, as Mr Tharman pointed out, the CPF system is designed to meet the retirement needs of workers in the middle- and lower-income groups. High-income earners have private savings. Workers in the lower income group, in fact, have an IRR of 81 per cent of pre-retirement income. If the supplements of their wages through the Workfare programme are included, the IRR is even higher - 93 per cent. Mr Tharman said: "The results of the study are an important validation of the CPF system. The refinements we have made to it over the years have ensured that the vast majority of young Singaporeans will receive adequate payouts in retirement." He pointed out, though, that it still falls to individuals to take responsibility and save, and for employers to take the responsibility of providing good jobs, sharing productivity gains fairly and keeping older workers employed. The fifth edition of the Human Capital Summit is hosted by the Human Capital Leadership Institute, the Ministry of Manpower and the Singapore Workforce Development Agency. At the conference yesterday, Acting Manpower Minister Tan Chuan-Jin presented this year's Asian Human Capital Award to digital-security specialist Gemalto and global supply chain manager for agricultural products Olam International for their people-management practices. MTR Corporation, Tata Consultancy Services and Toyota Motor Philippines Corporation were named Special Commendation Prize Winners. Edited September 20, 2012 by Enye ↡ Advertisement Link to post Share on other sites More sharing options...
Latka 1st Gear September 20, 2012 Share September 20, 2012 Dat is privided dey don't get retrenched or suffer pay cut. Link to post Share on other sites More sharing options...
Alpha78 6th Gear September 20, 2012 Share September 20, 2012 Q: How do you know when a politician is lying? A: His lips are moving. Link to post Share on other sites More sharing options...
Perseus76 2nd Gear September 20, 2012 Share September 20, 2012 they are talking about young singaporeans starting work today can achieve it....those started last yr or before, good luck to you. Work till u died washing dish with 3K/mth Link to post Share on other sites More sharing options...
Enye Hypersonic September 20, 2012 Author Share September 20, 2012 Dat is privided dey don't get retrenched or suffer pay cut. we all have good jobs...won't get retrenched. employers very good govt say wan Link to post Share on other sites More sharing options...
Enye Hypersonic September 20, 2012 Author Share September 20, 2012 (edited) they are talking about young singaporeans starting work today can achieve it....those started last yr or before, good luck to you. Work till u died washing dish with 3K/mth its ok...we can depend on our children since they are so comfortable give birth to more! Edited September 20, 2012 by Enye Link to post Share on other sites More sharing options...
Perseus76 2nd Gear September 20, 2012 Share September 20, 2012 its ok...we can depend on our children since they are so comfortable give birth to more! their calculations is on individual, not depending on children....hahha.....mordern parents dont really depend on children for retirement...dont they? anyway, numbers are afterall, numbers......they are as real as they are today. the indications is only base on today stats....by the time u retire, this stats dont stand anymore, because of blah blah and blah....... Link to post Share on other sites More sharing options...
Sabian Turbocharged September 20, 2012 Share September 20, 2012 (edited) For a new entrant to the labour force, it's a loooooong way to retirement. Edited September 20, 2012 by Sabian Link to post Share on other sites More sharing options...
Pokyman 1st Gear September 20, 2012 Share September 20, 2012 sure or not? Can the government give me a black and white signed off from the Finance minister guaranteeing me $x / mth when i retired?? Knn policies change how ... Link to post Share on other sites More sharing options...
Stratovarius Turbocharged September 20, 2012 Share September 20, 2012 Zhun bo? I see many young couples buying EC, use everything in their OA + top up cash and take 30 yrs loan got $$$ in CPF for retirement? Link to post Share on other sites More sharing options...
Yahgo22 1st Gear September 20, 2012 Share September 20, 2012 When was the study conducted? Guess before the HUDC and EM sold at above $1.2M. Link to post Share on other sites More sharing options...
Shull Turbocharged September 20, 2012 Share September 20, 2012 Technically, the bugger is right.. cos they didn't take into account the CPF monies used to buy flat... Link to post Share on other sites More sharing options...
Pentium 1st Gear September 20, 2012 Share September 20, 2012 CPF of course can be enough. raise the Minimum sum scheme to 1 million, sure got enough one. Sell your house, proceeds go to the minimum sum also Link to post Share on other sites More sharing options...
Enye Hypersonic September 20, 2012 Author Share September 20, 2012 Technically, the bugger is right.. cos they didn't take into account the CPF monies used to buy flat... it seems they did take into account. govt say even after paying off your roof, CPF still enough to give you comfortable lifestyle. Link to post Share on other sites More sharing options...
Tom_kkh 1st Gear September 20, 2012 Share September 20, 2012 it seems they did take into account. govt say even after paying off your roof, CPF still enough to give you comfortable lifestyle. well, they didnt mentioned if they based on a 1 roomer or 5 roomer.... Link to post Share on other sites More sharing options...
Picnic06-Biante15 Supersonic September 20, 2012 Share September 20, 2012 PARAPROSDOKIANS... quote : Winston Churchill "Since light travels faster than sound, some people appear bright until you hear them speak" Link to post Share on other sites More sharing options...
Zenithpool 2nd Gear September 20, 2012 Share September 20, 2012 confirm not for my case. need to pay house until 65. every month after CPF contribution still need to top up case (single ownership scheme). so when I reach 65, technically, my cpf is ZERO (O.A.) Link to post Share on other sites More sharing options...
Subutai 3rd Gear September 20, 2012 Share September 20, 2012 Means must work till 65... then retire, right?? ↡ Advertisement Link to post Share on other sites More sharing options...
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