I realised why People Hate the CPF

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Takes away 20% of income
- E.g. earn $3000 per month, that’s $600 of pay deferred till retirement years
- Not able to use your own funds in your prime adulting years 20s-30s for investing, business
- BUT: Employer is still paying you additional 17% of your income, compared to a non-Singaporean/PR.
- Argument: Some employers do pay the additional 17% to foreigners, which cause even more unhappiness
Waiting time is too long for utilisation
- Only able to withdraw $5000 or any amount above Full Retirement Sum (FRS) from age 55 onwards
- For a young adult, it’s almost 30 years away where circumstances can change
- What if you need funds suddenly for emergencies
- BUT lets not forget that CPF Primary purpose is retirement and retirement means using your funds at a later stage of line
- It should always be seen as a forced savings account to be utilised during retirement years, instead of a bank savings account that allows you to withdraw freely
Complicated Terms & Conditions
- Acronyms OA, SA, MA, FRS, BRS, ERS, BHS?
- Different tier of interest rates, e.g. OA 2.5%, SA & MA 4%,
- Below 55: first $60,000 get additional 1%, 55 Above: First $30,000 get 6%, next $30,000 get 5%. All capped at $20,000 OA
- MA has a limit of BHS, 2022 = $66,000
- Different fund flow according to account limits
- Reserved funds vs non-reserved funds that cannot be withdrawn
Some other reasons people hate the CPF?

[@HoneyMoneySG]

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[@HumdrumSingaporeanREACTS]

😯😯😯😯😯😯😯😯😯😯😯

[@tanernest1594]

CPF do more good than harm to Singaporeans’ lives. Singaporeans generally have high willingness-to-spend, many will have problems affording housing and retirement without CPF.

[@stevetan2858]

CPF is especially useful when we buy property. It also enable me to buy into insurance funds and shares(CPF investment account) too. In the long haul, it helps a lot. When I was in my young 20s, I do hate like most youth. Once I buy my first HDB property and do my first investment in shares and fund, things changed for the better. Fortunately, I was able to get rid of emotion when I deal with such things. Now I am waiting for my condo(Bought during beginning of convid19) 3 years to be ready and cash out to ride on my next property purchase. When people is in fear, you go in. While when majority of the people go in, I step out. Simple to understand but not many understand the concept. Make full use of CPF. If you don't have plan for your OA account, do direct the funds to SA. Do take note this is non-revertible. I did all the above. Now I am in my late 40s.

[@linekerkb]

I used to hate it. But after I bought my HDB. I know that I do not need to come up cash for my house loan. With housing been fully paid & have my FRS at 50, I can choose to retire anytime.

[@mauriceling]

Want to take CPF to start a business? Think carefully. CPF is about the only thing automatically shielded from bankruptcy proceedings

[@kenneth.lim3390]

2:50 Employers don't look at employer CPF contributions as a 17% extra. When they view your salary as an expense to the company, they will view as a whole including the 17%. So, even if you are taking home only $2,400, you are still a number in the expense of your employer's book as $3,510 (not yet accounting for employee insurance and other benefits which also costs money). The more interesting question is a foreigner taking $2,400 + levies for hiring a foreigner VS a Singaporean local taking $3000 (before CPF and 17% employer CPF)..who is cheaper?

[@dukesun4766]

Foreigner cheaper. That's why MOM has so many rules against hiring foreigners.

[@owariz9344]

When I’m was in 20s I dislike cpf. However as years goes by, stages in life changes then we appreciate it more.👍 nice video.

[@whis5448]

Is actually "forced savings". Thanks to this CPF, I am able to save, else will be ZERO savings until now.

[@mohamedyusoff3883]

Hi Chris thanks for sharing and advocating CPF. Could you make a video to explain with your current strategy: 1. How much are u able to withdraw in cash when you are 55 2. When you are 65 how much will you be able to receive monthly base on FRS This will help the us understand why CPF is a powerful tool

[@pathfinder1672]

Totally agreed. When I was young, I hated CPF. When I aged, I loved CPF and think it is a brilliant idea. To share some numbers for Yusoff benefit. I am 53 years old with 4 room HDB - fully paid with CPF. OA - $281K SA - $261K MA - $66K. By 2024, FRS is $206K. I am expecting between $1400 - $1500 per month at age 65. To answer qns 1, I will make it simple by assuming I am not working now, hence no more CPF money going in. At age 55, CPF will take $206K to RA, the amount I will be able to withdraw is SA $55K + OA $281K = $336K cash. I intend to continue working so will treat this as Savings account if ever I need emergency money. Will most likely do CPF shielding before I step into age 55 to ensure I get higher interest at 4%.

[@mohamedyusoff3883]

@@pathfinder1672 Thanks for sharing your journey with us, this helps me alot and give me a number to work towards!

[@munster1404]

. When I was young, I appreciated CPF. But as I got older and expenses climbed up, I grew resentful at having my own money locked up and retirement getting further out of reach.

[@cathhl2440]

Maybe when you’re much older, you’ll be thankful you had money locked up.

[@munster1404]

@@cathhl2440 I turn 44 this year, at the moment voluntarily unemployed living on cash savings (currently on year 2) for a 3 year planned break from work, with 0 debt, single/childless (to cut down on cost of living), no dependent, and already co-own a fully paid up 5 room flat since my late twenties. That is why I’m resentful of CPF because I have unfulfilled plans which are locked up. I can even semi-retire now if I have access to CPF. I’m saying that one’s support for CPF varies at different stages of life.

[@cathhl2440]

@@munster1404 But you know CPF is here to stay ah… why didn’t you plan according to the resources you can actually use?

[@angelalim0502]

Those who hate CPF are probably those YOLO individual or think that they may die anytime to even see their CPF $. Not all are keen to leave their own hard earn $ for their family member, especially those with no dependant.

[@Lucas-wn5wm]

Imo many people in sg cant save money or want to learn to invest. They really would have nothing...

[@kcchiew4247]

I hate CPF's annual contribution limit.😅

[@cathhl2440]

LOL!!! Ikr…

[@keithlee8511]

RSTU to SA is reserved if your cohort's FRS is not reached at age 55. It's a non-issue if FRS is already reached and any amount above FRS is free to withdraw, regardless of RSTU or voluntary.

[@winstontoh6346]

The last time I summed up all the interest earned from my cpf over the last 10 years, it was enough to pay for my hdb flat then. Wow. CPF pay for my flat literally!

[@MasterLeong888]

I don't contribute much to CPF as I prefer to be self employed, invest in equity to go for 10% to 20% average annual returns much better than parking in CPF i feel kekeke

[@eiooops]

Cos young people are afraid by the time they retire, they won't see the money.

[@lohwaihoh]

I think CPF is brilliant. It really help us to prepare for retirement.

[@simonsimon2028]

what happen to those SINGLE who had early death, no nominate. they dont ever smell their own full sum before passed on or use it. So what is the point of higher interest when they dont ever get to use it. So their work hard their whole life and who benefit those money? does this policy make sense to them?

[@Xamael666]

Hi Chris, possible to do a video on good short term investments, say like 1 to 5 years / 5 to 10 years? Thanks!

[@MasterLeong888]

I use my CPF as the bond portion of my portfolio for long term 2.5%-4% risk free bond is amazing kekeke

[@bloggeraldwin]

Same I really whack in too

[@BULLIER8]

hi can share is it you use cpf oa to buy bond?

[@bloggeraldwin]

@@BULLIER8 yes we all do

[@jeremychuasees2846]

Really great content.

[@coldbrewed8308]

CPF should be optional and not compulsory

[@nexus56216]

it maybe the lack of choice as individual. it is the money that people work hard and also pay tax as a good citizen. the fact that the gov could force it whether like it or not, makes some people against the system. Why would gov assume that it is the best thing for individual? Does the gov think everyone does not know how to manage the money like a small kid? Those are the words that I usually heard.

[@olidmi98]

Nanny state

[@donykoh]

without cpf how most ppl could afford to pay for their btos?

[@JRambonian]

On the ground, i thought are those ignorant older folks hate CPF more than younger gen? Younger gen these days are more financially savvy unlike the past

[@zanang194]

Hi Chris, so am I right to say that the max I should RSTU into SA is $40k, if my aim is to do shielding? i.e. $8k/year for 5yrs. Coz the max tax relief is $8k for SA/MA top-ups. Is the interest earned on the $40k principle considered as reserved as well? This also means that once I'd topped up $40k, then i should transfer OA to SA to hit FRS earlier as those funds are not reserved. Thanks in advance.

[@HoneyMoneySG]

Your idea is correct but to be exact, since the interest generated on RSTU-SA will be reserved as well, the true amount will be lower than $40K. Which works out to be $15K at 30 y/o for 25 years compounding at 4% p.a.

[@zanang194]

​@@HoneyMoneySG Ok so means that the capital and interest derived from that capital used for RSTU to SA are all reserved. Hmmm... this topping up seems more like an art than a science. So to be more exact, the RSTU capital and its compounded interest should add up to $40k by 55. So if you runway is long, you can't top up as much since the compounded interest is actually helping, which ironically also means that you get lesser tax relief. I guess, I need to explore SRS for tax relief as the cap is $15,300/yr.

[@deschua76]

Most of the people who hate CPF are those have fun staying poor folks!

[@cathhl2440]

Trying to be more empathetic… I thought of those who are really not earning enough to understand the benefits. Maybe should understand their stories too.

[@gemasboy]

What would be your your threshold amount for “poor”? $50,000?

[@deschua76]

@@gemasboy the fact that you have to ask me shows that you belong with the have fun staying poor folks…

[@deschua76]

@@cathhl2440 mayb u shd try to STFU and the Fark Off…

[@darrenkwok84]

mmm waiting time is one key point though

[@HumdrumSingaporeanREACTS]

🧐🧐🧐 _food for thought_ 🧐 thanks

[@HumdrumSingaporeanREACTS]

😯😯😯😯😯 seems cool~

[@choymaymay]

There are more actually... After 55 and after 65.... You covered mainly before 55

[@Xisiqomelir]

I just view it as funnymoney that isn't really mine (but is really Hx Chxng's!)

[@forevergraceful6160]

sad.