Personal Finance
Chor Dai Dee and CPF proposed changes
By Singapore Man of Leisure  •  August 8, 2016
When I was working at Montgomery Ward Buying House as the Hardlines merchandiser, I picked up this interesting card game called "Chor Dai Dee" from my bosses. The MD and QA manager were both Hong Kongers that applied for Singapore PR and citizenship due to the 1997 HK hangover thingy. It's one cool game! You know the CPF proposed changes? I deliberately held my hand. Now that most of the key animals in our community have showed their hands, its time for the grasshopper have a bit of fun to discover who is not wearing any clothes... More choice and flexibility? When CPF Life was first introduced, how many options were offered? 4 right? What were the reasons they gave for streamlining it to the present 2 options? So they changed their minds again? Want to bet once they tried to explain concepts like Net Present Value, Nominal and Real Inflation Rates to the same people who find 4 options too many and confusing, which way will the pendulum swing in the future? Really? You want to go there? We believe this is good for you; and in your best interest For those who still remember the previous permutations before the present CPIS were introduced, compare it to the arguments for LRIS, any difference in marketing spin? What were the projections? Now compare it to the present reality where only 16% of CPF members using CPIS made more than the 2.5%... Talk about unintended consequences... You mean we can arrest the self-inflicted underperformance of CPF members with low fees and longer lock-up periods? Pray tell why you didn't think of it when you introduce CPIS? (So much for goals, objectives, and having a plan... Its still reacting to crash got sound mah) Some animals have already declared LRIS as good, better, best! Of course its vested interest. Opinions anyone can give. Nothing wrong. I do that a lot too! The performance of CPIS we can evaluate now as there's 10-20 years of actual track records from CPF members - not excel file projections like for Wholelife insurance policies. Hello! LRIS not even introduced yet. Your opinion based on what? Well you see, based on the past 20 years of data-mined statistics... and we project it forward another 20 years... you'll get... OK, now try explaining it to those 84% CPF members under CPIS. Ah! You see the fine print at the bottom? Past performance is not indicative of future... Eh? Then why you bring up past statistics? Today's weather very nice hor? Sorry! I got to go to the beach! Bye! Spear and shield Don't you get a feeling there's mixed messages? Sometimes they treat you like idiots, or widows, and orphans. Draw cartoons and make it real simple for you. Look dee dee, this is how you draw a circle... Sometimes, their faith in us is so great it feels like that scene in Forest Gump, "Run! Run Forest run!" CPF is good Don't get me wrong. I like CPF. I've worked in 2 other countries with different systems from us. The key difference is ours is a pay-as-you-go system. It puts personal responsibility right in front. Just as long we don't forget it, we are good to go. Wink.
Singapore Man of Leisure (welcome to my blog; just google it!)
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By Singapore Man of Leisure
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2 responses to “Chor Dai Dee and CPF proposed changes”

  1. Fred says:

    It is a ploy. A set up. You think it will get a study by MOM? It will probably get thrown out after two to three years like some previous ones.

    Joke! With this climate of negative or very low interest rate globally and getting lower, with hot butts burrowing even lower, it will take probably another 15-30 years to climb beyond the CPF OA 2.5% or SA 4-5%. The DJIA is an outlier, both in U.S. or global context.

    Within US, they talk about the real economy is detached from the stock market. Globally, only the U.S. stock market is running in opposite direction from the rest of the world.
    LRIS wants to offer more confusing choices to who? Haha…84% of CPFIS smart alexs(myself included) trying to punt on MSCI Global Index, ASEAN, Asian ETFs or even our local STI ETF? Haha…who has forgotten our SWFs lost heavily in 2015.

    These pros with AAA brains can’t scrap through even one per cent in 2015, our Bengs, Mat, and Muthu can do better than 2.5%?

    • Fred,

      I would prefer they keep it simple for the majority.

      The sad reality with CPIS and good intentions is the majority 84% are in a bigger hole than had they done nothing and just let their money rot in CPF with the 2.5% interest. Boring, but safe!

      I would think its better to recommend CPF members to invest with their own cash for the first 10 years.

      Only if they had proven to themselves they can beat the CPF 2,5% hurdle rate, then they have earned the “right” to tap and utilise their spare CPF money for investments under CPIS.

      It’s meritocracy.

      Performance based; not hope based. How to argue with your own track record?

      If big daddy feels generous, can give extra 1-2% interest to those CPF accounts with less than $100K age 55 and above. This way, the less well off will get the “help” they need without throwing them to the wolves!

      Some financial advisers out there are so despicable that even I – a man whore snake oil – see them no up.

      As for the balance 16%, you think we will be interested in LRIS when we have been doing pretty well by ourselves?

      Duh!

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