[Scythian]

IF CPF Board cannot provide CPF members with ROI between 7% and 10%, others can.

Then, CPF management should step aside and let other professional fund managers to do it.

If you can't do it, Why force yourself?

[Scythian]

"WHO said in the land of the blind the one-eyed man is king?"

Are Singaporeans all blind with only few One eyed men,?

[teaserteam]

Move yr CPF there quietly.  Here very difficult;  must approved by Parliament etc.  Dun think opposition has a chance at all.

[sgbuffett]

If CPF gives 7% return there will be years of 10-15% losses ..

There is no reward without risk.

Long term average return if GIC is 6%.

If I am managing my own retirmenet funds I will just put half in Berkshire and the other half in a Global ETF....and leave it inside for 35-40yrs.

[Scythian]

If CPF gives 

Long term average return if GIC is 6%.

GIC ROI is 6%
CPF pays @ 2.5% pa savings

Who pocketed the interest differential of 3.5%?

Where the money go to?

[RiseofAsia]

If CPF gives 7% return there will be years of 10-15% losses ..

There is no reward without risk.

Long term average return if GIC is 6%.

If I am managing my own retirmenet funds I will just put half in Berkshire and the other half in a Global ETF....and leave it inside for 35-40yrs.

Now then some ppl know CPF gives pathetic rate.

[Napoleon Porlumpar]

IF CPF Board cannot provide CPF members with ROI between 7% and 10%, others can.

Then, CPF management should step aside and let other professional fund managers to do it.

If you can't do it, Why force yourself?

1) quit and give up huge salaries ?

2) quit and let Sinkies know how little money is left at CPF ?

[Scythian]

.

Don't believe whatever they say, pigs can fly.

[sgbuffett]

One of the biggest disappointments is the CPFIS.

Instead of creating a scheme to benefit Singaporeans as much as possible, the govt tried to aid the fund management industry when years charged high annual fees on funds managed this caused many to lose money.

We were not allowed to buy the best funds and best stocks. Access to proven funds and low cost etf is poor.

Instead of educating people on proper investing suited for retirement...eg Dollar cost averaging and diversification. People are made to think that jnvesting is dangerous....you can lose. This exposes CPF account holders to risk of inflation as they simply aim for low fixed returns.

There are many success stories like 401Ks and best practices that are not adopted by the Singapore govt.

Their performance here is disappointing

[Ola]

GIC ROI is 6%
CPF pays @ 2.5% pa savings

Who pocketed the interest differential of 3.5%?

Where the money go to?

Only morons like Jac Lau will say "Thank You PAP for robbing"

[Blasterlord2]

If CPF gives 7% return there will be years of 10-15% losses ..

There is no reward without risk.

Long term average return if GIC is 6%.

If I am managing my own retirmenet funds I will just put half in Berkshire and the other half in a Global ETF....and leave it inside for 35-40yrs.

You forgot that Warren Buffet will soon be gone and his successor may not be as capable.

[Scythian]

"CPF member receives $250 a month for only 8 years to “retire”


A CPF member who would be turning 65 in May this year, recently received a mail from the CPF Board. It informed him that he would be eligible to receive S$250 per month for about the next 8 years when he hit 65.

"
https://www.bannedsite.com/forum/current...20hit%2065.

[Scythian]

@ 65 yo receiving $250 CPF payout for 8 years is crazy.

In the first place, the system should not exist..

[Scythian]

Only morons like Jac Lau will say "Thank You PAP for robbing"

CPF Board should be closed down

Let people deal directly with GIC

[Scythian]

CPF Board should be closed down

Let people deal directly with GIC

Shouldn't be allowed to continue underperforming far below Norwegian Pension Fund benchmark. Year after year.

[maxsanic]

IF CPF Board cannot provide CPF members with ROI between 7% and 10%, others can.

Then, CPF management should step aside and let other professional fund managers to do it.

If you can't do it, Why force yourself?

I would like to know who exactly are the professional fund managers that can consistently achieve an ROI 7% - 10% over long term multi-decades in SGD terms. I doubt it's that easy to find one.

Do take note that the world's largest pension fund by Norway government has only managed a 6.62% annual return from 1998 - 2021 and this is denominated in Norwegian Kroner. https://www.nbim.no/en/the-fund/returns/...%20percent.

The NOK has depreciated from 0.22 to 0.15 from 1998 - 2021 as well. This translates to a net depreciation of ~2% against the SGD, so in summary even the illustrious Norwegian pension pension fund can only deliver ~4.6% annual return when converted to SGD.

Even at current low interest rates, the CPF can already deliver a blended interest rate of ~3.5% after accounting for 2.5% OA, 4% SA/RA/MA, top up +1% for first 20k and top up +1% for seniors. The gap is much smaller than most people envision.

[Scythian]

I would like to know who exactly are the professional fund managers that can consistently achieve an ROI 7% - 10% over long term multi-decades in SGD terms. ... envision.

"With your super it's important to look at long-term performance. The average return over 10 years for AustralianSuper's Balanced option is 9.32% per annum to 30 June 20221. This financial year (1 July 2021 – 30 June 2022) has been one of market ups and downs.4 July 2022"

https://www.google.com/search?q=australi...verage+ROI&oq=australia+super+average+ROI&aqs=chrome..69i57j33i10i160l2.16342j0j4&client=ms-android-oppo-rvo3&sourceid=chrome-mobile&ie=UTF-8#:~:text=With%20your%20super,4%20July%202022

[[[ForeverAlone]]]

Simple,

remember CPF claim in line with Bank interest?

got one researcher do mention this

but hey wait? Now look Bank increase their interest whereas CPF ? remind intact?

What it means?
whats the hidden agenda behind?
etc etc

[maxsanic]

"With your super it's important to look at long-term performance. The average return over 10 years for AustralianSuper's Balanced option is 9.32% per annum to 30 June 20221. This financial year (1 July 2021 – 30 June 2022) has been one of market ups and downs.4 July 2022"

https://www.google.com/search?q=australi...verage+ROI&oq=australia+super+average+ROI&aqs=chrome..69i57j33i10i160l2.16342j0j4&client=ms-android-oppo-rvo3&sourceid=chrome-mobile&ie=UTF-8#:~:text=With%20your%20super,4%20July%202022

No, you cannot just do a raw read off of returns like this. These returns are reported from an Australia point of view and therefore denominated in AUD. One of the main reasons why it's easier to chalk up big returns is due to translation gains from the rapid depreciation of the AUD. The converse also holds true, our SWF performance gets impacted with significant translation losses due to the general appreciation of SGD against most other currencies.

Based on your link, this particular Australia Super logs a 9.3% p.a. return from June 2021 - June 2022. However, the AUD depreciated massively against the SGD in the same period from 1.31 in 2011 down to 1.00 by 2021. If you work out the math that's roughly only 6.4% p.a. on SGD terms.

Even then we must view this in perspective, this 6.4% p.a. comes from taking up the balanced option, i.e. this is not capital guaranteed and returns gyrate significantly according to market volatility. It's more equivalent to us investing through CPFIS in a balanced portfolio consisting a mix of equities and fixed income themed funds. The nature of such returns is very different from the government capital guaranteed and fixed formula driven interest rate mechanism.

While one can definitely argue that CPF should allow citizens to max out their entire OA for CPFIS purposes and invite professional fund companies to come up with some simple thematic funds, this is another topic for discussion and comes with its own set of pros and cons. My POV is it's not fair to compare the CPF blended 3.5% interest to what is essentially a RSP that invests in mutual funds. 

When Singaporeans say they want more returns than the ~3.5% now, I don't think they are referring to change the whole mechanism into an unprotected balanced mutual fund investment, most of the time they want the CPF to give them much higher returns and yet follow the same mechanism we are all getting now. That's not really financially feasible unless global interest rates rise to the very high levels in 1980s - 1990s.

[sclim]

surely some can do better then the long term return of 6%. the reality is many cannot. maybe 1-2 years can when market is up. then market down. they die until disappear and only come back when market up.
many reasons. some due to huge cost overhead that eats into the return.
best is those type managed by a few people. research support etc supported by external fund managers free.
who are more then keen to manage huge sum of money. problem is need very clean, and for the people manager. not those who work for their own benefits.

[Scythian]

.

It's long over due, CPF Board management should go into hibernation.

[[[ForeverAlone]]]

surely some can do better then the long term return of 6%. the reality is many cannot. maybe 1-2 years can when market is up. then market down. they die until disappear and only come back when market up.
many reasons. some due to huge cost overhead that eats into the return.
best is those type managed by a few people. research support etc supported by external fund managers free.
who are more then keen to manage huge sum of money. problem is need very clean, and for the people manager. not those who work for their own benefits.

This is why I keep slamming SG Butt promote Mr Loo CPF ,

so what he got million ?

if so why now still work? In fact is selling his service as financial advisor , start up

on the other side promote his wife luxury handbag business.

Come on If you claim oh I work PASS TIME because i already rich ?

[Scythian]

..

Unknowingly, more than 4,000,000 members hard-earned savings could have been cheated thru out their entire lifetime by Ponzi system..

[sgbuffett]

I would like to know who exactly are the professional fund managers that can consistently achieve an ROI 7% - 10% over long term multi-decades in SGD terms. I doubt it's that easy to find one.

You makke it sound like you need to find a genius fund manager to get 7% a year. This is a misconception. How to get 7% is straightforward and requires on discipline to follow 2 steps.

How to manage retirement funds starting from when person start work age 25 to 60yo. A total of 35yrs is a simple process that has been turned into something complex and confusing by many.

It is  a 2 step process:
1. Select well diversified fund like S&P500 ETF or Global ETF ..or .a low cost fund like Vanguard.

2. Dollar cost average ...e.g buy  every month using a fix amount say $1000 or $2000 depending in your income

The money will compund to $1.8M per $1000 put aside every month  based on 7.5% returns of a Global fund. S&P500 was higher. If you did this $1000 a month from 35yrs ago you would have $1.8M now.




Despite how simple it is and many people have done this, the following has happened:

1. People are sold insurance products with sub oar returns.

2. Because investment can move up and down people are scared into putting all their money in fixed deposit  or CPF SA topups. Which hurts their retirement significantly.

3. Some people are misguided into all sorts of things they should not do like stock picking, trading, options etc because they will never reach the proficiency to do these well.

It's just simple 2 steps. It works. It is hedges against inflation and xomound your retirement funds  over time.

[Scythian]

.

After more than 60 years, CPF Board management still doing the same shitty stuff IE. Nothing has changed.

WTF

[watchfirst9]

Many countries done it by allow their currencies to depreciate as much or more.
It is raiding people savings and investments openly.

Let be frank, this world cannot be all winning, possible half or more can be losing.
Only when demand is more than supply can majority wins.
Currently correction is only beginning.

[maxsanic]

You makke it sound like you need to find a genius fund manager to get 7% a year. This is a misconception. How to get 7% is straightforward and requires on discipline to follow 2 steps.

How to manage retirement funds starting from when person start work age 25 to 60yo. A total of 35yrs is a simple process that has been turned into something complex and confusing by many.

It is  a 2 step process:
1. Select well diversified fund like S&P500 ETF or Global ETF ..or .a low cost fund like Vanguard.

2. Dollar cost average ...e.g buy  every month using a fix amount say $1000 or $2000 depending in your income

The money will compund to $1.8M per $1000 put aside every month  based on 7.5% returns of a Global fund. S&P500 was higher. If you did this $1000 a month from 35yrs ago you would have $1.8M now.




Despite how simple it is and many people have done this, the following has happened:

1. People are sold insurance products with sub oar returns.

2. Because investment can move up and down people are scared into putting all their money in fixed deposit  or CPF SA topups. Which hurts their retirement significantly.

3. Some people are misguided into all sorts of things they should not do like stock picking, trading, options etc because they will never reach the proficiency to do these well.

It's just simple 2 steps. It works. It is hedges against inflation and xomound your retirement funds  over time.

You are viewing national pension policy making from the lenses of an individual investing for retirement.

A pension fund has a set of internationally recognized best practices on specific risk management requirements. These risk management practices do not appear out of thin air nor are they in practice because everyone who manages pension across the world is so dumb that he/she cannot think of an obvious no brainer solution like just buy S&P500 ETF. 

Both the examples you give are pure 100% US or heavily US weighted equity ETFs which are ill suited if we want to continue the current CPF risk-value proposition. Do note that even the Norwegian pension fund and Australian Super defaults are highly diversified across multiple asset classes and the Australian Super is quite clear that it functions more like a RSP with tax incentives rather than a government run DC pension plan.

The challenge is not coming up with funds that can generate >7%, but working under constraints required of a national pension program of our profile. This is different from thinking as an individual - you yourself can buy whatever equity funds you like, at the end of the day win or lose your problem and has no social implications.

Equity ETFs can tank big time during financial crises, what then is the CPF board supposed to do in those times? Tell the CPF members who happen to retire at that time too bad that the CPF sum you can withdraw has dropped 30% and just live with it? Or maybe just suck it up and continue to give out 7% - 10% interest rate to all members and top up the remaining 30% capital losses during withdrawal hoping that the downturn will pass soon? Individuals might be tempted to take the risk, but a national pension plan that affect millions of people cannot take on such a risk on the assumption that historically equities will bounce back sooner or later.

If its the former, then knowing herd behavior what will likely happen is this will spark a bank rush and motivate all sorts of ill-disciplined people to make a dash to exit through withdrawals, switch to CPFIS fixed income / gold, change to property etc. thereby aggravating the already bad situation and further damaging any prospect of ever reclaiming back the losses when the market recovers. Then what? Start to change policy and impose all sorts of restrictions to stop people from cashing out their money in all sorts of exotic ways? This will likely lead to another round of whining and bitching and possibly organized protests.

The converse also holds true, if CPF absorbs all losses and continues to promise a high interest and capital guaranteed withdrawals despite significant loses, then all sorts of funds will find all sorts of policy loopholes and tactics to come back and ride the free bandwagon thereby compounding the losses that comes from giving high subsidized returns. The whole thing becomes unfunded and a pure government subsidy program.

I am in agreement with CPFIS reforms to allow more flexibility for members to tailor their investments in more instruments including low management cost ones and also for the CPF to use its leverage to reduce/eliminate admin costs in the process, but this is a completely different proposition from the thread starter and what most Singaporeans want when they complain about CPF and want to change the "fund manager" of the CPF funds.

What people are really saying is this: Change a fund manager to manage all of our CPF monies, this fund manager should easily make 7% - 10% off our monies. This will then allow the CPF to raise interest rates to 7% - 10% consistently every year. It must be capital guaranteed, there should also be no change to policies concerning when and how much I can take back.

This is the deal killer. Based on my experience in the industry, even if CPF really go out and call for tender with the above requirements, no sane fund management company is going to take that up. It's not financially feasible.

[Scythian]

..

CPF Board management acting like carefare

[sgbuffett]

You are viewing national pension policy making from the lenses of an individual investing for retirement.

A pension fund has a set of internationally recognized best practices on specific risk management requirements. These risk management practices do not appear out of thin air nor are they in practice because everyone who manages pension across the world is so dumb that he/she cannot think of an obvious no brainer solution like just buy S&P500 ETF. 

Both the examples you give are pure 100% US or heavily US weighted equity ETFs which are ill suited if we want to continue the current CPF risk-value proposition. Do note that even the Norwegian pension fund and Australian Super defaults are highly diversified across multiple asset classes and the Australian Super is quite clear that it functions more like a RSP with tax incentives rather than a government run DC pension plan.

The challenge is not coming up with funds that can generate >7%, but working under constraints required of a national pension program of our profile. This is different from thinking as an individual - you yourself can buy whatever equity funds you like, at the end of the day win or lose your problem and has no social implications.

Equity ETFs can tank big time during financial crises, what then is the CPF board supposed to do in those times? Tell the CPF members who happen to retire at that time too bad that the CPF sum you can withdraw has dropped 30% and just live with it? Or maybe just suck it up and continue to give out 7% - 10% interest rate to all members and top up the remaining 30% capital losses during withdrawal hoping that the downturn will pass soon? Individuals might be tempted to take the risk, but a national pension plan that affect millions of people cannot take on such a risk on the assumption that historically equities will bounce back sooner or later.

If its the former, then knowing herd behavior what will likely happen is this will spark a bank rush and motivate all sorts of ill-disciplined people to make a dash to exit through withdrawals, switch to CPFIS fixed income / gold, change to property etc. thereby aggravating the already bad situation and further damaging any prospect of ever reclaiming back the losses when the market recovers. Then what? Start to change policy and impose all sorts of restrictions to stop people from cashing out their money in all sorts of exotic ways? This will likely lead to another round of whining and bitching and possibly organized protests.

The converse also holds true, if CPF absorbs all losses and continues to promise a high interest and capital guaranteed withdrawals despite significant loses, then all sorts of funds will find all sorts of policy loopholes and tactics to come back and ride the free bandwagon thereby compounding the losses that comes from giving high subsidized returns. The whole thing becomes unfunded and a pure government subsidy program.

I am in agreement with CPFIS reforms to allow more flexibility for members to tailor their investments in more instruments including low management cost ones and also for the CPF to use its leverage to reduce/eliminate admin costs in the process, but this is a completely different proposition from the thread starter and what most Singaporeans want when they complain about CPF and want to change the "fund manager" of the CPF funds.

What people are really saying is this: Change a fund manager to manage all of our CPF monies, this fund manager should easily make 7% - 10% off our monies. This will then allow the CPF to raise interest rates to 7% - 10% consistently every year. It must be capital guaranteed, there should also be no change to policies concerning when and how much I can take back.

This is the deal killer. Based on my experience in the industry, even if CPF really go out and call for tender with the above requirements, no sane fund management company is going to take that up. It's not financially feasible.

You are right. I am speaking at personal level on how best to save for pensions.

There are pension funds of large scale that are managed to achieve good returns one example is Calpers. Like you said there will be years and periods of losses ...but they seem to be accepted by the stakeholders as part of long term pension fund management.

[Scythian]

"Said Mr Tharman: "While the CPF doesn't provide the highest returns, it provides one of the safest in the world. And these are fair returns."

Turning to how the funds are invested, he said that CPF funds are used to buy special bonds that offer a guaranteed payout.

The money that is invested in these bonds is then deposited with the Monetary Authority of Singapore, and managed by fund manager GIC, as part of a larger pool of the Government's funds.

"This allows the GIC to invest for the long term, including investing in riskier assets such as equities, real estate and private equity," said Mr Tharman.

He noted that if CPF funds were held separately as a stand-alone fund, the GIC would have to manage it more "conservatively" to avoid the risk of failing to meet its interest obligations"