Bye Bye SA, Welcome $4k - Mr Loo Strikes Back!

A more Technical Analysis of the CPF Changes: What good could come out of these changes?
For today's Video, the Editor/Researcher/Slide Maker, with the help of Mr Loo, drank much coffee and lost much sleep to understand the Retirement Account and its impact.
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Helping Ordinary People lead Extraordinary Lives

[@friedrice7707]

Hello Mr. Loo, it's positive that we can all aspire to live longer, healthier lives to fully enjoy the benefits. However, we mustn't overlook the fact that this increased longevity has influenced policy decisions regarding payout eligibility age. For instance, considering the rising life expectancy in Singapore, the eligibility age for payouts was raised from 62 to 63 in 2012, with further increases planned to 64 in 2015 and 65 in 2018. Reflecting on past trends, it's apparent that history tends to repeat itself. By putting the maximum amount in CPF Retirement funds, we are entrusting our financial security to policymakers, leaving us with no control over how these funds will be utilized in the future.

[@tzechintan4408]

Dear Mr Loo, I am impressed with your faith in CPF life paying us 6% dividend eventually. BUT , if the government is not going to pay our SA interest at 4% now, nothing is going to convince me that they will pay me 6% later...

[@morgankl797]

Faith or Blind Faith is one thing but 🈚知与幼稚又是另外一回事。Heard from someone saying this 🤔

[@avatar328]

Medishield Life is a plan they came up with to slowly deplete our Medisave even though Medisave monies is something we will never be able to use if we do not ever get hospitalized in our lifetimes . I don’t trust this government anymore

[@joschan18]

I would rather keep the money myself earning less interest instead of keep topping up to RA. The RA is at the mercy of someone to change the rules. Is a losing game for us

[@MrBlues0410]

I think we can do some homework now and look at current CPF-SA approved investments which can provide better than the OA's 2.5% yield. Like Mr Loo said, don't rush as this new scheme will only be implemented in 2025.

[@liweiquek7382]

If you have excess money, then top up to the maximum in cpf. The unused RA principal can give to beneficiary and unused interest go to the cpf pool donate to those people who need it.

[@JimmyT2009]

Singapore Stats says there will be 1 in 4 Singaporeans suffering from dementia after 65 in year 2030. It was 1 in 6 in 2022. Just pray we don't get dementia and not enjoy the CPF Life payouts to a dream age of 100.

[@worstalentscout]

actually majority of Sinkies already have dementia since 1965............

[@yooong]

It is evident that the government encourages individuals to increase their retirement account (RA) to ensure a secure retirement without relying heavily on the government. However, it is important to note that the downside of this approach is that the money is tied up and cannot be accessed for emergencies or personal needs. Life is full of uncertainty, and there may be times when extra cash is needed. Therefore, it may be wise to consider only the FRS and use the remaining SA amount for other financial planning purposes.

[@junjun906]

why do you need the remaining SA amount? when you have 3.3k dispensed monthly, life is all set. as scammers become more sophisticated, having large amount of withdrawable monies in SA or cash or withdrawable OA is dangerous.

[@yooong]

@@junjun906 I believe it is a matter of personal preference because some people may prefer having extra cash on hand that can be used for unexpected events. Mathematically, $3.3k may be sufficient if life is predictable enough!

[@pathfinder1672]

@@junjun906 There are so many reason why u need the money from age 55 to 65 - pay for insurance, kids education, taking care of yourself with chiro, massage etc. Remember 3.3k is dispense only at age 65.

[@Fiona20238]

@@junjun906 just to give u an example, my uncle was talked into topping up both he and his wife's RA to FRS amount when he sold his landed at a price that he kept cursing every time we met coz he could easily get another 750k more today. He was a taxi driver so they worked very hard to pay off that house. They have downsized to one of those million dollar 5 room flats. He is 65 this year and has opted to withdraw the monthly payout, which he said is totaled about $2500* or so for both of them. *amt is unclear as I don't want to drill too much into his financials but we should be able to track back. Clearly, the amount is insufficient for 2 if he did not want to touch his savings. He has enjoyed a few great years of vacations etc after retirement but now at only age 65, he is having problem with his knee. Just think about it, he found the payout attractive to top it up to FRS less than 5 yrs ago but the inflation last few years had certainly changed his mind. What I am trying to say is the amount that looked attractive today is clearly insufficient by the time we make our withdrawals at age 65 / 70 with a host of medical costs that are outside the government subsidies. If we go cheap by going to government health facilities, the follow-up is horrifying because u have to make so many more trips than private, one trip for scan/blood tests/x-ray etc instead of doing everything together because there is no such thing for public health care. The cost of transport for someone with mobility problem already add up substantially, even those with no mobility problem, it is tiring at old age. Also, many Singaporeans are marrying late, giving birth late etc which makes it even worse if they have to fund education, housing loans with that payout. Feel free to correct me if u think I have pointed something wrong, I am just learning these RA stuff recently as my husband will be retiring in a few months' time. My BIL was giving us a crash course on the CPF shielding when this scrap off of SA came out.

[@elaineang1049]

Working hard and saving hard in CPF for a few decades ,only to enjoy a 3.3k /month payout at 65. This is miserable. 😢

[@samuel8888aug2]

Money in my own pocket is always the best. Why parked money to someone pocket that keep changing their policies according to their desire? And we can only suck thumb when policy changed.

[@jacklee8817]

Wah Piang. Eat until cannot finish

[@qiuhao4212]

At 5:23 , its not "dividend payout" or "yield" . This cpf life is annuity and not share investment. For annuity, the payout is drawing down from capital with NO interest accumulation. In the example, annual payout of 6.3% means that the capital is totally used up in 15.87 years and legacy value for nominees is ZERO after 15.87 years. For share investment (eg local banks dividend yield of 5+%), the payment of the annual dividend do not reduce the number of shares held. Annuity payout is not dividend or yield.

[@3dkenn]

I am not confident nothing will change from 55 to 65...

[@eyecandyfactory]

Believe me, the goal posts will shift again in the near future. The conditions will just get tighter and tighter. My guess is that the three CPF Life plans in future will eventually be merged into one with no bequests to NOK

[@jessicakai1]

Sorry what is NOK?

[@fin788]

Next of kin. U can google by the way.

[@lufth.2042]

From the look of it, the goal post didn't shift. It's only how big of small you want the goal post/ monthly retirement amount to be at 65.

[@fin788]

@@lufth.2042 it did shift. Getting monthly and 1 lum sum is 2 diff thing. When ur old, monthly is enough to survive. But from 55 to 70....having a lum sum of money at least u can enjoy more before getting too old. If not, u literally work till old and wont get to spend ur money. Thats the difference

[@avatar328]

I suspect they will get so desperate to hold members’ CPF until they will legislate that nominees cannot get their parents CPF if they passed on if the nominees do not satisfy their $10 million FRS 😂

[@jasxteo]

I will only look at FRS and not ERS. when old liquidity is important. Who knows if you will wake up well tomorrow?

[@thureinoo]

Basic plan is NOT a "total crap plan". Providend has a great video explaining about it.

[@liweiquek7382]

Agree

[@kenlim9281]

I think Basic plan is better the bequest payable is much higher.

[@AZ-pxzpm]

Perhaps Mr Loo can clarify why he said the Basic Plan is a crap plan. Most, if not all videos, from the financial gurus mentioned that the Basic Plan is the best of the 3 plans.

[@AZ-pxzpm]

@user-xt5tx5yv9f Totally! His presentations should not be based on his own preference but facts as such videos are watched by the general public.

[@matthewlim3225]

Yes you still have the flexibility to pledge and withdraw RA after 65 years old. Basic plan best for legacy and flexibility. Just like flexibility to withdraw from SA. Only thing now is withdraw from RA. He doesn't know this point.

[@fin788]

If people still doesnt realize this.. nothing else can be done to make them realize...its obvious that the system will change again to benefit the gov. So best answer is aim to max MA, then dont bother already about cpf. In future...gov gonna change again and u will end up having to keep chasing something that is not feasible.

[@christopherchen9316]

What happen if we have runaway inflation of >10% or devaluation of Sing dollars with Policy Change. The fact is CPF's should not exploit our retirement funds with low 2.5% interest, else why should people do Shielding?

[@andrewpar4056]

very good video, Mr Loo has told us the best option , unlike other speaker, ask you to make your own choice.

[@jcsan8071]

Putting so much money into RA will never happen to me at any condition. Why let gov tide down your cash and you might mati before even reaching 65. i strongly believe alot of commercial funds will launch alot of promotion comes 2025 to take in business. Anything above 2.5% than OA will attracted anyone. Does the gov really think people would be so dump to put 4 times FRS inside ?? Did they forgot the cpf funds getten lesser might have less fund for them to borrow?

[@ChironGoh]

When Life Expectancy is 83, it means there is a 50% chance you will not live beyond 83 years old. That's what life expectancy is all about. For every year beyond 83 yrs old, it means the chances will reduce exponentially, not linearly. For the normal circumstances of drawing your money from 65, the breaking off point is 91years old. It basically means the odds of we beating the system to earn more than what our initial funds put in, is actually very slim, most probably less than 20% chance.

[@rayne8158]

It is like winning jackpot.

[@LittleJoyFactory]

Let’s say you were to delay the payout to 80 years old, you would have $6k a month , so what? you will enjoy it only for a few years 😂😂😂 I will definitely start at 65 years old, 握在自己手里的钱才是钱，其它的都是数字

[@morgankl797]

At 65yo ur doctor will say u can't take this, u can't take that, if u go tour at 70yo good chance is that u are the luggage security guard, together with the tour bus driver! (as u can't climb those stairs etc). Take $3330 at 65 yo but 1. are you aware that $333 0figure is not a guarantee amounts 😢 2. What if they change the rules n move to 68yo etc or reduce the payout figure??

[@stiwrc2002]

This is what I thought so as well..no one know what will happen in the future. My x college was happily purchased his condo with his gf. And after paying the deposit on Sat, he passed away on Sunday. So life is really like a toilet bowl you never know what shit you going to get.

[@user-yd4yf3ho1f]

$$ to fund hospitals😂

[@guardsmen1977]

@@stiwrc2002omg tat is so sad, so the condo how?

[@marvelcomiks8078]

Should delay to 90 years old. Can get $10k a month. For at least 1 or 2 years. LOL.

[@2011crane]

How did you arrived at the word Dividend and "Yield"? when you are drawing down your principal?

[@aleggsinonebasket]

6.3% is damn good dividend only if I get my whole principal+interest(accumulated from 55 onwards) minus payout back when I die. The other thing is the average life span is 83 years old. So for average person, payout is only from 65 to 83.

[@agtay424]

Mr Loo, if one dumps the 400k into RA and with no liquidity, what’s going to happen if someone gets cancer within 55 to 65? The chance of dying rich is self-inflicting.

[@junjun906]

medisave and medishield will cover the cancer expenses.

[@stephenang499]

@@junjun906 You have got to be kidding

[@agtay424]

@@junjun906 if medisave and medishield can cover the entire course of cancers treatment then insurance companies selling costly cancers protection will be bankrupt

[@comic098]

Don't think is enough...​@@junjun906

[@chaangru]

This is why insurance is also impt. Not an agent, do speak to one for advice.

[@andywuu9142]

Thank you, Mr. Loo, for your clear explanation of the new CPF policy. However, I've decided against further contributions to my SA/RA account. The pandemic has highlighted the unpredictability of life, with even young and healthy individuals facing mortality. I doubt I'll live to 70 or 80 to benefit from such savings, especially considering the rising cost of living.

[@limcheehean]

Don't use 4.08% to calculate. Next quarter drop to 4.05% already. Long term just assume 4%.

[@Kumanthep]

Can you compare bequest amount of choosing Basic and Standard Plan if are to start drawing at age 65 and pass away at age 70.

[@ocswoodlands]

1 aspect that I agree about this video is "take your time to think through". I am thinking of 2 aspects, which will take months and even years: 1) How am I going to react financially to the changes? Looking for pseudo AAA instrument that yields close to 4% for 30 years. 2) How am I going to react to an administration that effected the changes? i am only human and i don't have it within me to just forgive and forget the CPFSA post 55 balance x 1.5% x 30 years lost.

[@ChristenB-qd3tc]

From these CPF changes and the so-called 2024 budget, it is getting more urgent to vote for a balance of power in the parliament. The national reserve needs to have one or more 3rd parties, which are alternative parties to check and balance, also scrutinise how the SG ruling party accesses (maybe raiding) the national reserve with the help of the puppet president!

[@scbchong6964]

You still have your SA from when you start work till age 55 lah. If you still cannot save enough after 30+ years of working, the problem is NOT pap gahmen, the problem is YOU.

[@ChristenB-qd3tc]

naive@@scbchong6964

[@user-sf5bt8eb4y]

all these mathematical calculations sounds very good and very fine. topup , interest, delay payout. lets come back to reality, at 70yo, give you take out 10k/month, what are you going to spend it on? and how many years left can you spend it for? even if you are still alive you would probably have some knee problem, cholesterol problem etc etc not to mention, who can guarantee all your calculation and prediction will still be relevant? maybe next year/5 years later,10 years later goal post change again? Mr loo is playing the angel, I am just playing the Devil

[@user-cw4mf1ub9n]

So what will be your plan then? Would you be spending all your money by 70 and then be broke if you live past 70?

[@eeekmeek2136]

sg gov very smart one, they already calculated everything…doesnt matter how long we live, they still win in the end lol

[@GooLid-eh4og]

Smart accounting

[@JS-dr3wt]

CPF life is like a draw down from RA pool from a pool of cpf member. Hence the 6% is the rate of draw down and not dividend.

[@MHSoh5327]

Average healthy age is around 74 years old _ better to start draw down at 65 to enjoy few more years of quality life,

[@JJ-iu6sr]

Mr Loo, do you know how CPF determine the yield of the payout? Is this enshrined in the constitution? As you mentioned in your presentation, the yield may be adjusted in the future, and it's not guaranteed.

[@derricksim1200]

Talking about the laws, I know that under CPF Act, it is clearly written that CPF Life Fund will not pay if it is insolvent. It is enshrined in the CPF Act. IMO, no disrespect, I think Mr Loo, is smart but not wise. He overlooked a few key risks, that's policy changes risk, liquidity risk and inflation risk. Another thing we should ask, is there better options out there? In my view, Best to just put BRS, and pledge your property as the other half. Free up the funds to manage it Yourself. I think It's a bad idea to top up to the ERS.

[@R6ex]

Still BAD! Loss of CPF shielding means lost of $200+K of SA interest in my lifetime!

[@Lancer21899]

70 yo…. How exciting also no use…

[@morgankl797]

有想法，没办法😢

[@sgboon]

Loo, if I got 426K in SA under old scheme. I will be enjoying monthly $1420 every month from 55. From 55 to 90, I will be taking a whopping 596K + still preserving my capital. Still having count my monthly payout from my cpf life Hor .

[@CatherineCarol]

Does the CPF life payout always stay the same if you choose the standard plan throughout your life or it changes ?

[@sp33dbump33]

How much is $4420/mth payout actually worth in 20, 30 years time? Factoring 3% inflation, 20 years later it is equivalent to $2450 in today's money and in 30 years it is equivalent to $1820 in today's money. Is it really freaking a lot? Example: In 2004 , a bowl of noodle cost $2.50 - $3. In 2024, a bowl of noodle easily cost $4 - $5. In 2044, $8-10?

[@xytan4376]

When u old and frail also cannot eat much. Doesnt matter u take so much money but cant enjoy much

[@akira771]

Tks Mr Loo! Just want to ask if at age 65, one takes out the 426k and buy a HDB 4 room resale, earn $3k rental per month, would that be more worthwhile as cp to CPF Life?

[@benjaminkswong3592]

With the hdb, u can still pass it down.

[@Ammotyr]

Thank you for sharing ....

[@jimtong]

Do not depend your life on CPF alone. Have another basket of eggs to support yourself also for before 65.

[@phongy45]

Yes and true .... Guys ... Don't rush into ... Another wrong decision.....

[@damyeuful]

Would you consider taking the extra in OA and put in children's SA account if that is allowed?

[@walcotttang6946]

Better take out at 65 to enjoy the life 😂no one can predict how long u can live bro after this covid😂

[@yanyz2979]

Ya, what if die at age of 66

[@morgankl797]

​@@yanyz2979:死不瞑目😂

[@aspirojohn7617]

Ma Loo lah , Loo

[@inspirasiplaylists9910]

Before 2030, Govt will change the rules again ... make it tighter for singaporeans to breathe and force them to work till 70-75. They can do this by reducing the RA interest, increase age of payout to 68 etc and by then, your money is already locked

[@sebastiantan2199]

Need to factor in inflation leh. $4420 in 15 years time is really not much.

[@TanLouis-jw8ld]

Thank you Mr Loo for the 1M65 chat

[@yoonpinlim1432]

for most people, the quality of life as a result of the quality of health deteriorates rapidly after 70. More like the monthly payout goes into medical bill. Mr Loo's calculation is not wrong but pragmatically, I don't know..

[@viper88448]

For those who have more than 20 years, jus assumed CPF is not your money and you come back and think again 2 years before u reach 55 or any age that govt deccide to change. too much policy risk in play which make any planning longer than 2 - 5 years irrelevant.

[@pathfinder1672]

The actual point of this whole episode is more people have started losing trust in the new govt.

[@TangKT]

Mr. Loo, I am 63 this year, can I use the SA to top up to the new ERS amounts?

[@dealswift]

This video is for CPF rich people, that has at least $426000 in CPF ( OA + SA ) at 55 yrs old this year right?

[@garlicbread68]

The video's primary flaw lies in its assumption of future government control, which is unrealistic. Uncertainties regarding policy changes and life expectancy cast doubt on the wisdom of allocating significant funds to the ERS. Additionally, it's a widely acknowledged fact that individuals tend to derive more enjoyment from their money in their younger years.

[@inspirasiplaylists9910]

Why should the Govt take the cue from banking practices - "you want liquidity, we pay you lower interest"? What the Govt fails to realise is that in the banking system, we are the Borrowers and Banks are lenders who dictate the rules. CPF Board is not a commercial banker. In fact, CITIZENS are the LENDERS. How much gains did the authority make investing CPF money? As citizens who owns the CPF money, there is NO LOST to the GOVT to pay citizens a decent interest payment since we are the lenders and the shareholders. How can the borrower dictate the rules to the lenders? Govt should stop thinking like a commercial banker and stop treating CPF account holders as clients. We are the shareholders who voted the govt to act in our interest. We do not surrender our CPF money to then be treated like a borrower and banks' customers.

[@taeyeonist1462]

who did you vote for? 60-70% of the ppl commenting here voted for this and got the govt they deserved!

[@MHSoh5327]

Government arguments is Bullshit. Medisave account can be used but still earning 4%

[@Steven__Steven]

If I pass on halfway, will my nominated beneficiaries be getting anything left from the RA?

[@matthew77ask]

now I am 62 - should I tried to cash top up the three account so to top up more into SA ?

[@eugeneteo9664]

basically the goal post is raised higher & further.how to score ? @ 65 the LC might not stand any more.

[@ObeluStrawberry]

actually also need to calculate at what age you need to live in order to break even, if the break even age is more that the avg lifespan, that means you contribute the the national reserve? i know for those with family can pass on as bequest? what about those single?

[@wtan1851]

Policy risk is low, but inflation risk is high.

[@EUEU-2015]

Misleading video and confuse people about 6% yield when there is limited return of initial sum put into cpf life back to your beneficiaries when you pass on to another world. If it is comparable to investment yield, the investment market value and balance of dividends can become part of your bequest. If you pass on before 88 years old, you are just drawing down your own fund and the accumulated interest. If you pass on before 88, you contribute to the social welfare of those with longer life..

[@stevenyip2631]

Mr Loo, you salah liao. The monthly "4K" payout is a drawdown of the premium paid. The investment returns of the fund is kept in the pool and be used for the monthly payouts after the premium is exhausted in about 14 years after the first payout at 65. So, it's not a dividend. It's just a frawdown of YOUR OWN MONEY.

[@hc5431]

He anyhow let go after 2 days of concussion is it ? 😂

[@chrissang7355]

I came across another video who shared it’s better to take basic . I agree ,base on pure maths calculation .

[@PR-pp4le]

Hi which video? I am interested to get another view

[@joyng7191]

Provided by age 65, you are still fit and healthy to receive the monthly payout.

[@bernardkoh1650]

I truly worry abt policy change.. imagine he say.. we are living longer and healthier, therefore CPF life shift to 75/80 yrs old to withdraw..

[@bennettan4245]

What is your strategy if the goalpost for ERS shift to 626K in another 2 year's time? Try to chase and top up to this amount?

[@captballz]

55 years old to 90 years old, thats 35 years for 426k investment to become 1 mil.... (135% profit) 135% gain over 35 years is only about 3.86% annually. Correct me if im wrong for looking at the big picture like this I think what this video doesn't account for is the fact that RA is being drawn down, as some pointed out at 90 years old, you've would have taken all those payouts, but ur principal amount is effectively 0. All these combined with policy risk, health risk, etc, dosen't seem too attractive to me

[@starbreath76]

It’s closed to 2.4% using online calculator

[@chriswong9819]

I rather do BRS, take the money out and invest in somewhere else. Even though the interest rates is lesser what CPF give. I’m still happy with it. How much would I spend when I’m turning 85 years old? Unless u wanna pass down to the next generation. But not forgetting the interest will not be included when u pass on.

[@loukk2486]

Mr. Loo, how can that be dividends or yields if you are drawing your own money + a bit of interest?

[@dageddy]

I wrote a program to analyse the various permutations. Looking at the numbers, I might just go for Standard plan age 65 drawdown to deplete the RA asap so as to draw from the common pool at age 80.

[@laichongchao8266]

Mr Loo should do a comparison for the [ERS/70 yrs old/standard plan] path with the [FRS/65 yrs old/standard plan] path with excess money being invested in SP500 giving 8% annually compounded and compare the difference

[@1m65]

S&p500 has volatility risk lah.

[@Msiaboleh57]

CPF says when a member dies only his unused premium in RA is refunded. Not the accumulated interests. Will a person get any RA interests if he dies at 64, or 66?

[@limcheehean]

Only interest generated after payout starts will go to the common pool. So RA interest accumulated from 55 - 65 will get back.

[@nswnsw6874]

Any annuity plans as good?

[@eddietan4646]

Hi, what happen to the balance of the RA if I pass on at age 67?

[@qqquek6241]

Mr Loh thank you for the video. Appreciate your efforts. However you seemed to miss out many details and hence must say overall i cannot agree with the way you dissected CPF Life Scheme. 1. It is not dividends as you see it. Reducing principals. 2. You compounded RA from 55-65yo but you totally ignored time value of money hence you returns calculation is incorrect. 3. Policy can change hence payout or returns also not guaranteed. 4. You said Basic Plan is crap. I think you should relook the details. 5. You didnt mention after 65 your compounded sum does not attract interests anymore! 6. You didnt take into account the 2% additional interests from combined balance up to 60k that supposedly will be paid into RA. 7. You didnt see the effects on bequest amount on the different plans. Overall good effort though. Hope you have a version2 video with improvements soon. :)

[@jasonlai1892]

70 years old chances is that the cpf payout either go to the maid, nursing homes of one self and/ or spouse. The nursing home see the elderly so cpf rich, may quote a high nursing fees (increment too) compare to someone who is cpf depleted. CPF will be very alarmed to hear 6.3% dividend yield.

[@MalcolmAng]

Like old man like to say, cpf money is never yours..(now this phase become the true, if policy keep changing and retirement age keep changing)

[@michtan7774]

Question: once you start withdrawing from 65, does the interest in RA still being compounded ?

[@david888a]

Don’t think it matters whether it will b compounded for the payout amount will b the same,$3300+ at age 65 or $4K plus at age 70 for life,isn’t it?

[@xube100]

70 years old millionaire, that draws 4k a month. How that sounds?

[@katrina4796]

Sound so sad 😢

[@neoweemin872]

The interest on the retirement sum will go to the pool not beneficiary

[@darrenlee1212]

No need to see that far.. Policies keep changing.

[@garykoh3304]

4 times BRS( ERS) 2025-$426k at age 55. Assume someone pass away at age 65( just before receive any payout), will CPF refund $426k or 640k with compound interest ( approx)? Anybody can advise ?

[@kennethlim886]

Yes. There is a providend video on it.

[@Edkko4822]

If I m not wrong is $426k, the interest will go to CPF life Pool.😢

[@lowjiaming4586]

by the time I'm 65 $4000 will be like only able to buy a few plates of chicken rice?

[@edwinlee6883]

quite likely can but rice only. no chicken.

[@ryojinkiiro940]

$4000 for a few chickens? You must be referring to those in Geylang :)

[@wlquiqui8348]

Remember the payment is estimates it is not 100%. As per mentioned average age is rising. Once average age rises everyone payout will lowered even halfway through payout. But it is correct do not rush into any thing.

[@HG-kn3hb]

Why no mention of interest from MA to OA if MA amount is maximum?

[@ongbengwan3029]

Invest $426k for 10 years, can see but cannot touch. 10 years is a long time and vs 6%+ dividend

[@tantuanweikelvin8936]

At my age of 51 this year, if I want to view this change positively, it makes it easier for me to make the decision at 55 to put ERS into my RA. Prior to the change, putting that amount would incur a higher opportunity cost. I could have left more in my SA and it will give me the same risk free return, with a much higher liquidity. Now, with the SA being closed at 55, that opportunity cost is now only 2.5, almost halved. Furthermore, I am now allowed to top up 4 times the BRS into my RA at 55, giving me significantly higher lifetime retirement income at 65. This has the effect of giving me a higher income floor after 65, allowing me to more confidently draw down even more of my wealth portfolio, in the 10 years between 55 to 65, what we call the "go-go" years of retirement.

[@waihengyong7165]

Plug into calculator, initial investment $630,500, every month constantly withdraw $3330, from 65-85 20 years. Then a 2.5% return will cause the money to run out at age 85. For 4% return, money will run out at age 90. How many people survive until age 90? I would say the effective return would be approximate 2.5%

[@limcheehean]

CPF Life is insurance against outliving your assets, so only good for those that live long.

[@Hairloslee]

If a person start monthly withdrawal at 65 n die at 66, the remaining amount in RA ( that goes to common pool) will it be given to his loved one.?

[@user-sf5bt8eb4y]

yes basic formula is sum that goes into RA - whatever that is paid out to person = return to family. But do note, the sum that goes into RA does not have interest incurred

[@Hairloslee]

To clarify, the sum that goes to RA after 65, no longer earn interest. It will be depleted over times but the person still get monthly payout till he die.

[@eggtomato13]

He shld go read the book Die with zero!

[@limcheehean]

CPF Life is kind of die with zero because it draws down on principal.

[@MHSoh5327]

This cancellation of SA after 55 is not about fixing the CPF shield- it could easily be fixed by returning whatever amount transferred during RA account setup once the SA received additional funds after RA account established. It's more like saving interest payout by government.

[@scbchong6964]

Citizen, are you above 55? I am above 55 and have been withdrawing from my SA for petty cash. Removal of SA after 55 does not bother me because liquidity from OA is still available. Why don't you speak to more above 55 citizens instead of knee-jerk complaining and blaming gahmen?

[@morgankl797]

Spot-on

[@scbchong6964]

@@morgankl797 Plse stop encouraging mindless complaining and misinformation about CPF system. Are you above 55? Do you know money is first taken from SA and sent to your RA. Majority of citizens after 55 got little use of SA. Why are you supporting the 2% who are gaming the SA for their personal benefit?

[@mountsophia3319]

🚧🚧🚧based on the info gotten from CPF website, it can be concluded that: 1: from 55 to 65 years old , RA confirmed receiving 4.08%. No issue for this stage of retirement. 2.If one survive til 90 years old, RA also confirmed will receive 4.08% 3. After checking thoroughly the payout process, if one were to RIP at 66, then “interest loss” will be negligible. If RIP at 82 years old, there will be a “total interest lost” meaning for $88,000 that went into RA, you will be fully paid 88k, but one will lose the accumulative interest of around 68k over 16 years into the CPF Life. If one were to RIP at 90 years or beyond, one reap the full benefit of the CPF life. So there is a flaw in CPF life payout. For that, I will just go for the Basic scheme.

[@zhiqunchua]

I would like to point out. $426K at 55 years old, compounded at 4.08%p.a. until 65 will be about $635,451 If you collect 3330 per month for 18 years (until age 83) and die, the total payout is $719,280. If you choose STANDARD Plan, the bequest is $0. Are you able to see that if you die earlier or even at age 83, you will lose a lot more. i.e. 1.34% p.a.

[@starbreath76]

6:36 We lose the 10 yrs of non dividend payout from age 55-65, so the dividend is not 6.3 % imo . Including the opportunity cost , the yield is closer to 2.4%. Initial sum 426k, final sum 999k over 35 yrs: 2.44% apy

[@starbreath76]

This means even at FRS it’s much worse then if we have SA compound at 4% 😢from age 55

[@JJW0314]

will there be a difference to enjoy at 60 or enjoy at 70 in term of feel and experience?

[@gunnerstnt01]

Definitly, your healthy is one issuse.

[@JJW0314]

assuming to overseas travel...at 60 will definitely walk better than at 70...even at the rate of digest foods well 😆😁😄

[@rameshn7165]

I think too many people were publicly beating the drums to show how everyone can game the system... so of cos they decided time to close thus loop... there is a saying when the sun is shining make hay but no need to sing while doing it.... to borrow someones wise words... there were too many birds going chirp chirp cheap....😂

[@inspirasiplaylists9910]

Disagree. Only a small % played with the system. You can close the loop on SA shielding WITHOUT hurting the majority of Singaporeans by killing off the SA acount totally. They are 2 different issues which the Govt has conveniently leveraged as an excuse not to pay Lenders (us) a decent 4%

[@ryojinkiiro940]

@@inspirasiplaylists9910 Only the rich have more money in the SA, so why should the govt help the rich to get richer? The interest saved can be channeled to help those that really need it.

[@lazarusdevadas273]

Please consider advice for the worst case scenario for the poorer CPF account holders

[@inspirasiplaylists9910]

$426k in 2025. It could be $520k in 2029 as BRS increases yearly. The ERS will keep increasing. So let's not assume $426k is the magic number because the ERS will increase by a lot more!

[@noprob7820]

Thanks Mr Loo for this enlightening video. Just curious, is there any figure posted by the gov of the number of people who are able to have $426,000?

[@1m65]

I don’t know if they publish these stats. But I know a lot of Singaporeans very CPF rich. They buying condos and million dollar HDB like I buy Cai Png.

[@limliza992]

​​@@1m65RA is not attractive to me as it depends in how long the quality of life a person can enjoy. No point drawing money at very old age just to pay medical bills and some people may be suffering from illness such as diabettes, dementia, strokes, parkinson disease or cancer. Worst is they need a large sum of money for treatment but stuck in RA. Money parked in assets such as properties that can hedge against inflation and has potential of capital appreciation, provide rental income and can be sold off if there is a need for money. At least there is the flexibility to liquidate and not just stuck in RA.

[@rec0n3r]

83 is the average expiry age for all singaporeans but you can further drill down by it by gender,ethnicity,occupation,etc!

[@morgankl797]

if u familiar with Corp presentation...end of the day its what u want to sell !!! Go to a car or condo showroom .....

[@choonsengteo9694]

Change la, why worry so much.

[@go2c]

see robert kiyosaki "Why would I save money when they print money?" ... dun waste time on bull..

[@flowercolourful4718]

If u delay recg the mthly payout, u will only rec a higher payout for the number of deferred year, and not for the rest of your life till u pass on.

[@goldenretrieverboy]

Nothing much useful here, just rephrasing what we already know, and extrapolating it over a long period of time. The main issue is the liquidity and the high interest. Like it or not, Financial products are the closest comparison right now, with annuities giving guaranteed 3-4.25% per annum, and we have the flexibility to surrender the plan and receive a guaranteed lump sum if the need arises, as compared to your suggestion. Not only top up even more to lock in, but wait even longer to collect!