Is CPF really that bad ? (Part 2 – Housing)

Screen Shot 2017-07-08 at 11.10.54 am.jpg

Did we harm ourselves? Or is it the Government fault?

Like how DTLIM commented, the allowance of more usage has lead us to deplete our CPF money faster than ever.  It’s actually quite scary, that Govern allowed CPF savings to pay for more than one property ( Very bad for the low/middle Income group)

Have the Allowance of CPF used for housing a good thing?


There was a study done by the Government as you can see, the average Singaporeans doesn’t shift to a smaller house but always to a bigger house! The number is actually not shocking because we humans are always looking for improvement, aren’t we?

So what do we have to pay when we move house?

  1.  CPF Refund (With accrued interest)
  2. Resale Levy (Not applicable for DBSS/EC/Resale flats/PRP)
    • Range from $15k – $55k
  3. Outstanding loan

But is all about my CPF… it doesn’t affect me

It does affect you! Being young and powerful, the tendency to spend and spend is inevitable. If the cash that is not used to invest, the probability of you retiring comfortably is very low. The sad truth is that, many Singapore are not financial literate and very pessimistic (good & bad thing).

REMEMBER, when you purchase a new house – Renovation will be the next big cost and it always tend to be in the 5 digit range… so you think you’re saving from paying with CPF? you might be spending more after all.

For the pessimist: the alternative of using our CPF has to always be greater than the $xxxxxx withdrawal amount when u turn 55. Without using your CPF at all you can withdraw a good 6-7 digit when you’re 55.

Disclaimer : Seek real financial help before acting on all these information as it is really damn biased… but its all factual (I take from government website hor).

Personal Thought:

Nothing is a guaranteed in life, even insurance companies, big banks (Lehman for example), but it should not stop you from making good financial choice. We are living in a world where risk is inevitable, the only way to win in it, is to have an edge. CPF interest rate is mandate by our government and its own by the country. That gives it a lower probability to be falsified (embezzlement/**** with us) without being caught as compared to a company.

“+1 Knowledge point”




5 thoughts on “Is CPF really that bad ? (Part 2 – Housing)

  1. Pandora’s Box was opened in mid-to-late 1980s when govt allowed CPF to fund purchases of private properties and resale HDB.

    Very good for property market, property developers, contractors & wider industries feeding off property development & purchase, banking industry, property speculators.

    But not good for ordinary joes & janes long-term retirement funding. Also not good for keeping a lid on high property / rental inflation.

    Cannot close the box now without crashing the entire economy.


    • Hey Sinkie!

      Hahaha physical property was or maybe is still the “in” investment… till government choose not to buy back.

      According to straits times 4% of a million flats have been selected for SERS. That’s pretty sad for people who think that their property value will never hit $0…Minister Lawrence say one!

      Guess we got to find a way out


      • Govt liberalized CPF for property in 1986 / 1987 when Singapore’s property market was in the doldrums (overall economy also not doing well — struggle to recover from SG’s first structural recession). Property developers struggling and banks’ profits also dropped a lot.

        It was Singapore’s version of QE, only this time the money was from private individuals, not high-level govt debts. At the same time, during the late-1980s and early-1990s, govt ramped up the propaganda for “asset enhancement”. Early purchasers of properties benefited greatly.

        Nowadays to profit from properties, need to buy only during bad recessions.

        As for our own homes, just take it as consumption item, just like food & clothing. Being able to cash out and/or downgrade is just a bonus & an option.


      • There’s never will never be a perfect economy.

        Buy during recession also hard the stamp tax is crazy… but buying through a company…. hehe that’s another way.

        I guess the general perspective has yet to be changed among many individuals, especially with the older generations reemphasizing the importance of a house being an asset. Guess their propaganda project worked!


  2. Pingback: CPF – Aged 54 & below |

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s