Singapore is a successful nation which revolves on a national philosophy of self-reliance. Throughout our rapid development, we have refrained from becoming a welfare state. This was made possible through the introduction of the Central Provident Fund (CPF) in 1955. 

There are many external forces which can hinder the effectiveness of our CPF system. One of the most prominent are the behavioural bias among CPF members which may potentially hurt the CPF’s mission of ensuring that workers could support themselves with dignity in retirement.

We shall highlight some common behavioural bias among CPF members and the measures undertaken by the CPF board to minimise its impact.

•     Bounded Rationality

Bounded rationality is the idea that in decision making, rationality of individuals is limited by the information they have

Most people have a strong tendency to underestimate their post-retirement needs. According to the Singapore department of statistics in 2010,...