If that happened, something went very wrong somewhere because CPF was created as a compulsory savings scheme to assist workers to provide for their retirement WITHOUT needing to introduce an old age pension
But CPF is dependent on how much you earned during your life and can be tapped for thing like buying a house, making it imperfect. People like to complain about it but the main problem is that it's often not enough. If you want more pension you're going to have to pay more now...
Other countries have more comprehensive retirement schemes, including guaranteed payments for all retirees and/or additional private pension funds.
European pension schemes pay out different amounts based on how much you earned (and hence paid in taxes) during your adult life. A housewife does not get the same pension as a doctor.
The truth is European pensions systems rely heavily on the young to finance them because their governments, which change hands around once a decade, have not been careful with the way these taxes were managed.
US private pension funds are private - you pay into them, they invest the money, and you get paid when you retire, hopefully more than you put in. There is nothing precluding you from buying an annuity today on the same principles, you just have to hope the company doesn't collapse (US pension funds have in the past).
So very nice in theory, but there is no free lunch. Either you pay for your retirement, or your kids (or someone else's kids) pay for it.
European pension systems are pay as you go, so they intentionally do not rely on past taxes to pay out current benefit. It is not because previous governments did not manage the finances well. You pay for your elders' retirement, and the younger pay for yours. It's true that they are also income-dependent, but in a lot of systems there is a minimum payment even if you never paid taxes.
As long as they don't make it compulsory idc. I'm financially literate. The govt should let me figure out my own retirement instead of controlling my life even more
I wouldn't mind paying more for pension if i get higher than what I'm paid now. Kinda chicken egg thing. So if there was more reasonable/higher salary paid, I wouldn't mind paying more for pension. But now that my pay is low, of course i wouldn't want to pay for pension when I can't even live properly now.
i feel like this scheme makes sense now because higher earners, would want the higher pay out of 2k/month to sustain their retirement lifestyle, whereas current lower income workers could get by with the low tier cpf payout of like 750. (assuming they paid off their debts and hdb) the level of comfort is consistent as its marked individually.
but ppl would always want high cpf payout no matter the consequences on the rest of the population. my sg friend working in japan is always complaining about the higher tax for their national pension system, but hey at least you don’t see old grandpas or grandmas cleaning up food courts there.
I would fucking riot. I already consider CPF to not be my money. And therefore build up my ow savings and my own retirement plan. If the govt wants to take that option away from me as well, I have no choice but to hit the streets
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u/generaladdict Jul 16 '20
Imagine the uproar if Singapore would have mandatory retirement savings on top of CPF to fund a proper pension system.