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Transparency & CPF Have the Same Aim
Transparency has Same Aim as CPF?
A major consideration for CPF is for a secure personal financial future and to prevent Singapore from becoming a welfare state, i.e, taking responsibility of your own future.
But wait, it has always been ingrained in me that the government is taking care of my funds via CPF, just in case I can't. There is a contradiction here. Financial management is a skill, it can be acquired, provided several factors are met. Education level being one of them. If you can't read or comprehend financial information, no matter how simple the concepts are, you will never be able to grasp them. Experience is another factor, unless you have tried it, you probably cannot fully understand it. So if I am not allowed flexibility to learn how to save or invest my money, how can I be more financially capable?
By asking for transparency, am I not asking for more information so I can take more responsibility for my finances? I am definitely not an investment guru but I can read and write relatively well so I do think I would be able to understand if the government explain how CPF is invested, how does it guarantee interest rate and does it cater for inflation? These financial planning skills I can acquire via more information would mean I can have a holistic view of my finances and apply them to my savings outside of CPF as well as factor in my CPF accordingly.
Proponents of CPF would like financial security for all but there is no guarantee that someone will not splurge when it comes to any amount, at any age and under any circumstances so I see this benefit as pretty much moot.
Financial Literacy is The Way to Go!
Minimum Sum & Financial Education
Biting off more than you can chew is a mindset that can be changed via education and experience. If let's say someone were to squander their wealth away, wouldn't it be better to do so at an earlier age when there are more employment opportunities, with health and time on their side, thereby reducing the risk of being on welfare?
By rising the minimum sum, doesn't that mean that people's financial plans have to make a U-turn and is in contradiction with what CPF is meant to do? The reported reason behind doing so is that we live longer now so more money is needed. In the first place, shouldn't CPF cater for the worse case scenario since we cannot predict the life expectancy of all individuals?
Have the firestorm started by a bunch of disillusioned people clouded this issue of transparency? Are people viewing those that ask for transparency as opponents of CPF when it is not necessary so? I think there are people with a wait and see attitude, would prefer transparency and want to make an informed choice that having the CPF scheme works for them. Partly for their personal financial plans and also to gauge if the ruling party can live up to their handsome salaries.
So, I am genuinely confused, I am encouraged to be financially responsible but at the same time I am immediately deemed incapable of handling my own finances, so which is it?
© 2014 Min