Have a third CPF-Life plan
Member of Parliament for Hougang SMC Png Eng Huat posted a suggestion to the government to consider a third CPF Life plan.
In Parliament today, he suggested a plan that gives a monthly payout to beneficiaries, but comes with an early draw-down age of 60 years old.
This, he said, will be similar to the old Life Income Plan, and it will give workers a choice to go slower after age 60.
"When we are young, we need a disciplined instrument like CPF to help us save for the future. But when we are old, we need a more flexible instrument to help us plan for the uncertainties of aging. Issues like job security, health, mobility, etc. cannot be taken for granted anymore. The current CPF Life plans do not offer older workers the flexibility to plan for an early or semi-retirement."
He said that not all older workers can work past their retirement age.
And for those who do, they may need such draw-downs to supplement their income.
He added that as the re-employment age gets raised from 65 to 67, so will the CPF draw-down age.
That will leave no room for Singaporeans to decide how they want to live their lives after age 55 or upon reaching the statutory minimum retirement age of 62.
"For workers who do not have any other form of life savings, these CPF savings are the only safety nets. CPF savings up to the Minimum Sum will be locked up all in the hope of achieving retirement adequacy."
Mr Png also urged the government to review interest rates for CPF savings.
He said that the formula that calculates interest rates for the Special, Medisave and Retirement Accounts was introduced in 2008, and is due for a review.
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