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sgbuffett Elite Member
Posts: 4,952 Reputation: 32
GIC uses the your money to get returns and keep the extra returns....compounded over time, the amount of returns they keep is more than the money you get when you retire. Economists call this opportunity cost. If your money is invested to get better returns, this returns should be given back to you.
Here is the proof. Using a savings calculator http://www.bankrate.com/calculators/savings/simple-savings-calculator.aspx
1. Gic average returns is 6+% per annum. CPF returns is 2.5%. 2. A person works from 25 to 65 total 40yrd. 3. Saving $1 a month for 40 yrs @2.5% you get $820. 4. Saving $1 a month for 40yrs@6% you get $1917.
The difference between what you get and what you should get is $1100. You take back $820 leaving $1100 in GIC. CPF Life makes this even worse, for every dollar a retiree withdraw about $1.5 of loss returns is kept in SGIC.
This is why Singaporeans fface a bleak inadequate retirement while elites keep hundreds of billions in reserves which they get paid high salary to manage. Such and unjust scheme must stop instead of forcing elderly to work longer and doing lease buybacks, the govt should simply return the money that belongs to the people. (This post was last modified: Today 06:53 AM by sgbuffett.)
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sgbuffett Elite Member
Posts: 4,952 Reputation: 32
GIC uses the your money to get returns and keep the extra returns....compounded over time, the amount of returns they keep is more than the money you get when you retire. Economists call this opportunity cost. If your money is invested to get better returns, this returns should be given back to you.
Here is the proof. Using a savings calculator http://www.bankrate.com/calculators/savings/simple-savings-calculator.aspx
1. Gic average returns is 6+% per annum. CPF returns is 2.5%. 2. A person works from 25 to 65 total 40yrd. 3. Saving $1 a month for 40 yrs @2.5% you get $820. 4. Saving $1 a month for 40yrs@6% you get $1917.
The difference between what you get and what you should get is $1100. You take back $820 leaving $1100 in GIC. CPF Life makes this even worse, for every dollar a retiree withdraw about $1.5 of loss returns is kept in SGIC.
This is why Singaporeans fface a bleak inadequate retirement while elites keep hundreds of billions in reserves which they get paid high salary to manage. Such and unjust scheme must stop instead of forcing elderly to work longer and doing lease buybacks, the govt should simply return the money that belongs to the people. (This post was last modified: Today 06:53 AM by sgbuffett.)
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