CPF members who defer withdrawal to age 70 will be screwed, be wary of CPF scam

Every tweak to the CPF scheme is designed to increase CPF monies for GIC to ‘invest’. 😦

Propaganda would have CPF members believe there are benefits to defer CPF withdrawal from 65 to 70.  Upon closer scrutiny, this appears to be just another scam.

CPF Life deferrers are scammed in the following ways:
1.  At age 80, a deferrer’s total payout is lower than a member who did not defer. (Retirement Sum (RS) = $60000) 
2.  Dead at 85, returns from deferment totally lost. (RS = $60000)
3.  Higher RS = Lower total payouts.  (RS = $210000)
4.  Higher RS = Lower proportional payouts.

For illustration, I will use the minimum payouts for $60,000 RS and $210,000 RS at age 80 and 85. (Using the maximum payouts produces similar results.)

1.  At age 80, a deferrer’s total payout is lower than another CPF member who did not defer withdrawal. (RS = $60000) cpfpropaganda11 (A) At age 80, a deferrer will receive total payouts of only $86,400 vs $97,200 for a member who does not defer withdrawal.  (Calculator)

From age 65 to 70, CPF monies earn up to 5% return for deferrers. (CPF Board)

Therefore, should a deferrer die at 80, he will also have lost a substantial amount of returns earned during  deferment.

What about bequest?  CPF Board has already covered every loophole to ensure the scam works: Zero bequest from age 80.
cpfpropaganda122.  Dead at 85, returns from deferment totally lost.
At 85, although the total payout of a deferrer at $129,600 is the same as one who does not defer, he will still lose every cent from deferment returns.

3.  Higher RS = Lower total payouts.  (RS = $210000)
Should a deferrer with $210000 RS die at 80, he would have been shortchanged by $34,200 in CPF payouts compared with another member who did not defer.
cpfpropaganda13Including about $58,000 return earned at 5% from age 65 to 70, a deferrer stands to lose more than $90,000.

(D) Even if he dies at 85, will still lose more than $60,000 ($58000 + $3600).

 4.  Higher RS = Disproportionally lower payouts.

Wealthier CPF members who think too highly of our money-faced government should reconsider their decision to loan more funds to GIC.

The more CPF funds placed with CPFB, the more CPFB will not hesitate to scam.

CPFB has already made it very clear that rates are subject to yearly reviews.

With GIC also having warned CPF members to expect a decade of low returns, rest assured CPFB has already thought of another way to further squeeze blood from stone.
As is evident, CPF members do not benefit from deferring CPF withdrawal.  In fact, it appears deferrers will be unconsciously screwed by CPFB. 😉

Singaporeans should be extremely wary of CPF propaganda.


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