Saturday, 20 December 2014
The Straits Times
This was an article contribution by Associate Professor Chia Ngee Choon from the Department of Economics at NUS Faculty of Arts and Social Sciences. Prof Chia noted that the Minimum Sum (MS) scheme and Central Provident Fund (CPF) Life help improve retirement adequacy and remove longevity risk, but they are not comprehensive enough. He opined that a single cohort-specific decreed sum will not be optimum to meet the retirement aspirations of different members. A better alternative is to allow people to save more in their retirement account, up to a maximum sum which can be set at 40 per cent higher than the Minimum Sum, and all CPF members must still set aside savings to meet the MS for a basic retirement.