CPF LIFE

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#31
Sorry to be a bit off topic here.

http://www.straitstimes.com/news/busines...rs-2014050

The increase in min sum is not just due to accounting for inflation. That I would think its transparent and fair. But it is raised also to account for higher living standard. Costs as measured by inflation is more or less objective. How to measure standard? I am sure buddies here all have very different standards of living, so could properly survived on hawker fare and bread, some need weekend dine out, some need annual holidays.

I am concerned there is room for abuse, not implying that it would happen though. What is to stop future leaders to say, to account for standard of living, w should have 150k instead of 120k in 2003 dollars and after accounting for inflation, we start another round of adjustment upwards from 2020? It will not be difficult to imagine if we have 2 more rounds of such exercise in 2-3 decade, I will never see my minimum sum since it would most probably need to be aside a quarter to half a million, depending how we define standard of living??

Also, I say this not because I think we will have crooks in our midst, just think Greeces and maybe to a certain extend Europe, when the going get tough(e.g. Shrinking workforce plus economic downturn ), what is to prevent the "lesser evil" of higher standard of living to keep the system alive?
life goes in cycles, predictable yet uncontrollable; just like the markets, but markets give you a second chance
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#31
Sorry to be a bit off topic here.

http://www.straitstimes.com/news/busines...rs-2014050

The increase in min sum is not just due to accounting for inflation. That I would think its transparent and fair. But it is raised also to account for higher living standard. Costs as measured by inflation is more or less objective. How to measure standard? I am sure buddies here all have very different standards of living, so could properly survived on hawker fare and bread, some need weekend dine out, some need annual holidays.

I am concerned there is room for abuse, not implying that it would happen though. What is to stop future leaders to say, to account for standard of living, w should have 150k instead of 120k in 2003 dollars and after accounting for inflation, we start another round of adjustment upwards from 2020? It will not be difficult to imagine if we have 2 more rounds of such exercise in 2-3 decade, I will never see my minimum sum since it would most probably need to be aside a quarter to half a million, depending how we define standard of living??

Also, I say this not because I think we will have crooks in our midst, just think Greeces and maybe to a certain extend Europe, when the going get tough(e.g. Shrinking workforce plus economic downturn ), what is to prevent the "lesser evil" of higher standard of living to keep the system alive?
life goes in cycles, predictable yet uncontrollable; just like the markets, but markets give you a second chance
Reply
#32
(11-05-2014, 10:18 AM)Greenrookie Wrote: Sorry to be a bit off topic here.

http://www.straitstimes.com/news/busines...rs-2014050

The increase in min sum is not just due to accounting for inflation. That I would think its transparent and fair. But it is raised also to account for higher living standard. Costs as measured by inflation is more or less objective. How to measure standard? I am sure buddies here all have very different standards of living, so could properly survived on hawker fare and bread, some need weekend dine out, some need annual holidays.

I am concerned there is room for abuse, not implying that it would happen though. What is to stop future leaders to say, to account for standard of living, w should have 150k instead of 120k in 2003 dollars and after accounting for inflation, we start another round of adjustment upwards from 2020? It will not be difficult to imagine if we have 2 more rounds of such exercise in 2-3 decade, I will never see my minimum sum since it would most probably need to be aside a quarter to half a million, depending how we define standard of living??

Also, I say this not because I think we will have crooks in our midst, just think Greeces and maybe to a certain extend Europe, when the going get tough(e.g. Shrinking workforce plus economic downturn ), what is to prevent the "lesser evil" of higher standard of living to keep the system alive?

I fully concur. If cpf ever increase the 120k ceiling , i be damm piss!
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#32
(11-05-2014, 10:18 AM)Greenrookie Wrote: Sorry to be a bit off topic here.

http://www.straitstimes.com/news/busines...rs-2014050

The increase in min sum is not just due to accounting for inflation. That I would think its transparent and fair. But it is raised also to account for higher living standard. Costs as measured by inflation is more or less objective. How to measure standard? I am sure buddies here all have very different standards of living, so could properly survived on hawker fare and bread, some need weekend dine out, some need annual holidays.

I am concerned there is room for abuse, not implying that it would happen though. What is to stop future leaders to say, to account for standard of living, w should have 150k instead of 120k in 2003 dollars and after accounting for inflation, we start another round of adjustment upwards from 2020? It will not be difficult to imagine if we have 2 more rounds of such exercise in 2-3 decade, I will never see my minimum sum since it would most probably need to be aside a quarter to half a million, depending how we define standard of living??

Also, I say this not because I think we will have crooks in our midst, just think Greeces and maybe to a certain extend Europe, when the going get tough(e.g. Shrinking workforce plus economic downturn ), what is to prevent the "lesser evil" of higher standard of living to keep the system alive?

I fully concur. If cpf ever increase the 120k ceiling , i be damm piss!
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#33
Caelitus already has the answer - top up your SA. At 35 this year and having $155,000 in his SA, and assuming he continues to contribute $400 per month to his SA, plus compounding at 4%, his SA will grow to $344k when he turns 55. That should outpace whatever MS adjustment.

(09-05-2014, 11:23 PM)Caelitus Wrote: I view this as a bond component of a retirement portfolio. Decent risk-free returns of 4% and 5% (on first S$40,000). I am 35 this year and aim to hit the minimum sum again by end 2014 by contributing under the minimum sum topping-up scheme. Reduces my assessable income for tax savings.
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#33
Caelitus already has the answer - top up your SA. At 35 this year and having $155,000 in his SA, and assuming he continues to contribute $400 per month to his SA, plus compounding at 4%, his SA will grow to $344k when he turns 55. That should outpace whatever MS adjustment.

(09-05-2014, 11:23 PM)Caelitus Wrote: I view this as a bond component of a retirement portfolio. Decent risk-free returns of 4% and 5% (on first S$40,000). I am 35 this year and aim to hit the minimum sum again by end 2014 by contributing under the minimum sum topping-up scheme. Reduces my assessable income for tax savings.
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#34
(11-05-2014, 12:53 PM)egghead Wrote: Caelitus already has the answer - top up your SA. At 35 this year and having $155,000 in his SA, and assuming he continues to contribute $400 per month to his SA, plus compounding at 4%, his SA will grow to $344k when he turns 55. That should outpace whatever MS adjustment.

(09-05-2014, 11:23 PM)Caelitus Wrote: I view this as a bond component of a retirement portfolio. Decent risk-free returns of 4% and 5% (on first S$40,000). I am 35 this year and aim to hit the minimum sum again by end 2014 by contributing under the minimum sum topping-up scheme. Reduces my assessable income for tax savings.
Ha! Ha!
Boh Pian!
You selected the "system", you just have to live in the "system" selected by you.
WB:-

1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.

Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.

NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
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#34
(11-05-2014, 12:53 PM)egghead Wrote: Caelitus already has the answer - top up your SA. At 35 this year and having $155,000 in his SA, and assuming he continues to contribute $400 per month to his SA, plus compounding at 4%, his SA will grow to $344k when he turns 55. That should outpace whatever MS adjustment.

(09-05-2014, 11:23 PM)Caelitus Wrote: I view this as a bond component of a retirement portfolio. Decent risk-free returns of 4% and 5% (on first S$40,000). I am 35 this year and aim to hit the minimum sum again by end 2014 by contributing under the minimum sum topping-up scheme. Reduces my assessable income for tax savings.
Ha! Ha!
Boh Pian!
You selected the "system", you just have to live in the "system" selected by you.
WB:-

1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.

Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.

NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
Reply
#35
wolfT,
are u refers to minimum sum?
it is always increase one lar.
155k from 1st July 2014

Heart Love Compassion


A Life not Reflected is a Life not Worth Living.
感恩 26 April 2019 Straco AGM ppt  https://valuebuddies.com/thread-2915-pos...#pid152450
Reply
#35
wolfT,
are u refers to minimum sum?
it is always increase one lar.
155k from 1st July 2014

Heart Love Compassion


A Life not Reflected is a Life not Worth Living.
感恩 26 April 2019 Straco AGM ppt  https://valuebuddies.com/thread-2915-pos...#pid152450
Reply
#36
(11-05-2014, 03:29 PM)chialc88 Wrote: wolfT,
are u refers to minimum sum?
it is always increase one lar.
155k from 1st July 2014

Heart Love Compassion


A Life not Reflected is a Life not Worth Living.

Hi Chialc,

I believe he is talking about $120k of 2003 dollars. It is possible to back calculate the value of the present value of $155k to 2003 dollar, and find out how far we are now from the ceiling.
Reply
#36
(11-05-2014, 03:29 PM)chialc88 Wrote: wolfT,
are u refers to minimum sum?
it is always increase one lar.
155k from 1st July 2014

Heart Love Compassion


A Life not Reflected is a Life not Worth Living.

Hi Chialc,

I believe he is talking about $120k of 2003 dollars. It is possible to back calculate the value of the present value of $155k to 2003 dollar, and find out how far we are now from the ceiling.
Reply
#37
(11-05-2014, 08:20 AM)Temperament Wrote: Anyone buying Annuity for longevity?

For one, I do. Not really an annuity, but a wholelife plan on joint-life basis that pays a fixed sum annually till both of us pass away and my kids will get a payout from the insurer.
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#37
(11-05-2014, 08:20 AM)Temperament Wrote: Anyone buying Annuity for longevity?

For one, I do. Not really an annuity, but a wholelife plan on joint-life basis that pays a fixed sum annually till both of us pass away and my kids will get a payout from the insurer.
Reply
#38
(11-05-2014, 03:29 PM)chialc88 Wrote: wolfT,
are u refers to minimum sum?
it is always increase one lar.
155k from 1st July 2014

Heart Love Compassion


A Life not Reflected is a Life not Worth Living.

The MS was set at $80,000 in 2003 and will be raised gradually until it reaches $120,000 (in 2003 dollars) in 2015.
In 2013 MS (in 2003 dollar) was $115k. We left 5k to reach "120k" in 2015. Assuming that each year is 2.5k.

(117,500/115,000) * 148,000 * 1.025 (inflation of 2.5%)= $154,997

Round off to nearest hundred. You will get $155k min sum for 2014

For 2015:

(120,000/117,500) * 155,000* 1.xx (xx depend on inflation) = $xxx,xxx

So for 2016 onwards

(120,000/120,000) * (2015 min sum)* 1.xx (xx depend on inflation) = $xxx,xxx

After year 2015, Min sum will continue to increase. But it will based on inflation only. Of course CPF can change their goal post again.
The thing about karma, It always comes around and bite you when you least expected.
Reply
#38
(11-05-2014, 03:29 PM)chialc88 Wrote: wolfT,
are u refers to minimum sum?
it is always increase one lar.
155k from 1st July 2014

Heart Love Compassion


A Life not Reflected is a Life not Worth Living.

The MS was set at $80,000 in 2003 and will be raised gradually until it reaches $120,000 (in 2003 dollars) in 2015.
In 2013 MS (in 2003 dollar) was $115k. We left 5k to reach "120k" in 2015. Assuming that each year is 2.5k.

(117,500/115,000) * 148,000 * 1.025 (inflation of 2.5%)= $154,997

Round off to nearest hundred. You will get $155k min sum for 2014

For 2015:

(120,000/117,500) * 155,000* 1.xx (xx depend on inflation) = $xxx,xxx

So for 2016 onwards

(120,000/120,000) * (2015 min sum)* 1.xx (xx depend on inflation) = $xxx,xxx

After year 2015, Min sum will continue to increase. But it will based on inflation only. Of course CPF can change their goal post again.
The thing about karma, It always comes around and bite you when you least expected.
Reply
#39
(11-05-2014, 03:35 PM)NTL Wrote: Hi Chialc,
I believe he is talking about $120k of 2003 dollars. It is possible to back calculate the value of the present value of $155k to 2003 dollar, and find out how far we are now from the ceiling.

Thanks. After I saw WolfT's calculation, crystal clear.

Heart Love Compassion
Live with Passion, Lead with Compassion
2013-06-16
Reply
#39
(11-05-2014, 03:35 PM)NTL Wrote: Hi Chialc,
I believe he is talking about $120k of 2003 dollars. It is possible to back calculate the value of the present value of $155k to 2003 dollar, and find out how far we are now from the ceiling.

Thanks. After I saw WolfT's calculation, crystal clear.

Heart Love Compassion
Live with Passion, Lead with Compassion
2013-06-16
Reply
#40
(11-05-2014, 03:51 PM)WolfT Wrote: (117,500/115,000) * 148,000 * 1.025 (inflation of 2.5%)= $154,997

Round off to nearest hundred. You will get $155k min sum for 2014

A minor comment :
The inflation rate for 2013 was 2.4%, not 2.5% [1]
The round off was to the nearest thousand.

[1] source from singstat at
http://www.singstat.gov.sg/news/press_re...ec2013.pdf
Reply
#40
(11-05-2014, 03:51 PM)WolfT Wrote: (117,500/115,000) * 148,000 * 1.025 (inflation of 2.5%)= $154,997

Round off to nearest hundred. You will get $155k min sum for 2014

A minor comment :
The inflation rate for 2013 was 2.4%, not 2.5% [1]
The round off was to the nearest thousand.

[1] source from singstat at
http://www.singstat.gov.sg/news/press_re...ec2013.pdf
Reply


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