Monday, June 16, 2014

Minimum Sum Requirement

With all the press given to it, you would be forgiven if you think the CPF issue is only about the legal action taken by Prime Minister Lee Hsien Loong against Roy Ngerng. You would be wrong however and a video doing the rounds in Singapore show why.

In the video, a retired woman met her MP, Hri Kumar, to ask for a way to get her CPF money. With the new the Minimum Sum requirement, the 76-year old retired teacher is now unable to access her retirement fund. The main problem with the video wasn't the complain by the old woman, it's a common site nowadays with the CPF, but the fact that the old woman is being penalized for keeping her money in the CPF.

The common wisdom in Singapore dictate that you cash out your CPF the first chance you get. Whether it is 55, 60, 65; the moment you reach the age, you cashed out your CPF and get your money in your hands. This retired woman did not. Whatever the reason, maybe she thought her CPF money would be safer with the government, she kept her money in her CPF and now probably can't ever access it.

This is a huge problem for the Singapore government. The Minimum Sum requirement is exactly penalizing Singaporeans who trust the government the most! Singaporeans who did not cash out their CPF, like the Singapore government encouraged, are the ones who are suffering the most from the new Minimum Sum requirement.

Honestly, I don't really have much sympathy with the retired teacher. Yes, I know it sounds terrible, but she should have cash out her CPF the first chance she got. Not doing so was a stupid and silly mistake to make and now, like it or not, the Singapore government need to tweak the Minimum Sum requirement for people like her. Not doing so would cost them big time in the next election. 

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