All posts by Mickey J

Update on my Open Letter about CPF Life payout process

I didn’t get a response from Mrs Josephine Teo, our Minister of Manpower. But you know who contacted me? The friendly folks from the CPF Board. I had a 1-hour long call with them to share my feedbacks and here’s what we have discussed.

In this article, I’ll attempt to be specific about things that are different for CPF members under CPF Life and those who are under the Retirement Sum Scheme (RSS).

What information does CPF Board need before they can start making payouts?

CPF members are required to provide their banking details when they would like to start receiving their payouts for both RSS and CPF Life. They can do this anytime between 65-70 (because doing nothing means you start your payout at 70) to start receiving payouts. For example, if you wish to start receiving payout 3 months after you reach age 67, you can do so.

For CPF members under CPF Life, CPF members are required to select a CPF Life plan (Standard, Basic and Escalating), provide their banking details when they would like to start receiving their payouts. They only have to choose a plan when they decide to start their payout.

What’s the easiest way to get this done?

In my conversation with the folks from the CPF Board, I found that the easiest way to provide all the necessary information to CPF Board is through the CPF website.

PS: It’s also on the right side of the letter in the recent CPF fiasco but everyone got caught up with the body of the letter.

After logging in to my CPF account, I can find the everything related to my CPF Life plan in the “My Requests” section.

As a tech-savvy individual, I’ll definitely get mine done online when the time comes. But for the non-savvy folks, they can consider using the CPF Retirement Planning Service (CRPS) offered by the CPF Board to get a one-on-one session better understand their options.

I feel that for those who aren’t up to date with the latest CPF changes (and there are so many of them), it’s always good to have an unbiased expert from the CPF Board to list out the options available for them. It can be very time-consuming and I applaud the CPF Board for offering this service.

We agreed on the need for better communication

What everyone agreed in the call, was that the current letter to CPF members explaining what they need to do to start receiving their payouts needs to be reviewed. My opinion is that we should just start from a blank page.

I would have preferred something that’s clear and concise with visuals. Maybe a step by step guide or flow chart could help explain things better.

In fact, I would even reconsider the method of communication. Would a SMS or email with links to the CPF website with more details be a better option instead?

What CPF Board can do to create a better experience?

Lastly, here are 2 suggestions I’ve made to the folks from the CPF Board.

Use data to help the public understand decisions made about CPF policies

I’m glad that CPF has sufficient data and insights to help policymakers make decisions. In a recent article, it was revealed that almost three-quarters of those getting monthly payouts from CPF Life or Retirement Sum Scheme receive less than $500 a month. Ouch!

About 6 in 10 active members who turned 55 in 2017 had, at least the basic retirement sum of $83,000 in their Retirement Accounts and that will give them a monthly payout of between $700 and $750 for life.

Let’s look at the recent CPF letter saga. If our Minister for Manpower started the conversation with insights derived from the data before explaining why the CPF payout process is what it is today, it would have been easier to help the general public understand why the process is done this way.

Create a frictionless CPF payout process to provide a great experience

I asked myself, what would I expect from the CPF Board when I’m 65?

I would want to be able to start receiving my CPF payout in a frictionless process once I reach 65. While the existing process allows everything to be done through the CPF website, I still question why I would need to take any action to indicate the age I want my CPF Life payout to start at all.

If I look at the payment process itself, CPF Board has already implemented making payouts using PayNow and they already have my existing mobile number. They can easily find out if I have linked my mobile number with a bank account for to transact using PayNow.

As I am under the CPF Life scheme, I need to indicate the CPF Life plan I want to enroll in. I intend to do this once I reach 65 and at this point, I’m planning to take up a CPF Life Standard Plan with Full Retirement Sum, with payout to commence at 65.

While the existing process does not take up too much time to complete, I hope CPF Board can make use of design thinking to examine what its members really want and make bold changes to make the entire CPF payout process frictionless and automatic.

Photo by rawpixel on Unsplash

My Open Letter to Josephine Teo about CPF Life payout process

This is my open letter to Mrs Josephine Teo, Minister of Manpower and Second Minister of Home Affairs, and Member of the Singapore Parliament for Bishan-Toa Payoh GRC about her response in Parliament on why CPF payouts are not started automatically at age 65.

Dear Mrs Josephine Teo,

I write to you as a fellow Singaporean and as someone who intends to retire gracefully in Singapore with CPF Life forming part of my retirement income.

Yesterday, you have addressed your fellow members of Parliament in response to their questions on whether CPF information can be better related to the public. In this open letter, I will be referring to the Youtube video of your speech posted by

There is insufficient proof that Singaporeans prefer to delay their CPF Life payout

In your speech, you have 60% of members on RSS who have reached their PA that year did not instruct CPF Board to start their retirement payouts. Out of this segment, you were not able to provide a further breakdown of RSS members who consciously decided to keep their savings in CPF and those who did not know that they could have started receiving their payouts.

6 in 10 members on the RSS who had reached their PA that year did not start their payouts even by the time RSS members reach 70, about half have not come forward to start their retirement payouts. Some among them may have consciously decided to keep their savings in CPF because they have no need of the payouts and also because they wanted to earn a higher interests. Others may not have known that they could have started their payouts earlier and thus did not instruct CPF Board.

Josephine Teo on “why not start CPF payouts automatically at age 65?”

As a member of the public, I would have preferred to have more clarity. If you had provided a more detailed breakdown of the number of RSS members who started their payouts at the age of 70 and later. It would be a fair assumption that majority of this group are intentionally keeping their savings in CPF.

For RSS members who started their retirement payouts between the age of 66-69, it would be fair to consider them as RSS members who did not know they could have started their payouts earlier.

Having this detailed breakdown could have helped Singaporeans better understand the current situation of our CPF Life payouts and justify the actions taken by the CPF Board today.

Unfortunately, we do not have these figures today to make better judgement.

Broken Promises: Not honouring the default CPF Life payout age automatically

The default CPF Life payout age is 65. I’m glad that you have mentioned that this have not changed. However, by making it compulsory for RSS members to take action, in order for the default CPF Life payout to commence does not seem fair and reasonable.

As a member of the public, it’s natural that I would perceive that the CPF Board is going back on its word and breaking promises on its obligations of paying out CPF Life on time.

Imagine you bought an annuity insurance from an insurer that promised to start annuity payouts at 65. You did your part in paying the monthly premiums to the insurer year on year as a responsible policyholder.

The insurer then decides to delay your annuity payout by 5 years if you do not take action to indicate that you want to start receiving payouts at 65.

Although your annuity policy will continue to accumulate bonuses, does that seem fair to you?

We are wasting taxpayers’ money if we do not change existing processes

Today, we lack data-driven proof to justify the current process of CPF Life payouts. Precious manpower in the CPF Board are being wasted on attending to RSS members to process a redundant CPF Life payout process and it seems that in your speech, you are committed to spend more taxpayers’ money to tell RSS members to head to CPF Board to process their CPF Life payout.

The right thing to do therefore, is to reach out to those members who may not have a good understanding and give them clear and simple information to help them make their decisions. With the benefit of knowledge, those who wish to, can still start their payouts anytime after 65.

Josephine Teo on “why not start CPF payouts automatically at age 65?”

It just does not feel like it’s the best use of manpower and taxpayers’ money.

What the CPF Board should do, is to gather and analyse more data about existing CPF Life payout behaviours and make an informed decision based on data.

Educating the public on benefits of deferring their CPF Life payouts

As a personal finance blogger, I started planning for financial independence and retirement much earlier than my peers. I can definitely see the benefits of delaying my CPF Life payouts to by 5-10 years if I have other sources of retirement income to pay for my expenses between the age of 65 to 70, or even 75.

Members may therefore prefer to start their CPF Life payouts later. This is especially so if they have other savings to draw on…

Josephine Teo on “why not start CPF payouts automatically at age 65?”

However, we can’t expect all Singaporeans to be like me and it wouldn’t be fair to the local majority.

While I feel that the CPF Board has done a great job with their marketing communication efforts over the past year in engaging the public, more could be done in educating the public, the benefits of delaying their CPF Life payouts and the other types of retirement income sources they could consider pursuing at the same time.


While there is still a lot of negativity around CPF Life in some of the public but I believe many are starting to turn around and understand the benefits of CPF Life.

I hope the government can make informed decisions and focus on addressing what’s wrong with our CPF Life payout system today. Taxpayers’ money can then be spent on educating Singaporeans to make better retirement planning decisions.

I understand that you may have lots to do on your hands right now and may not be able to reply to this lengthy email. But I hope you would reconsider your stance on the current CPF Life payout process for the benefit of Singaporeans.

Best Regards,
Mickey J
Personal Finance Blogger at

Singapore Budget 2019: What middle class Singaporeans need to know

In this article, I’ll be zeroing in on the things that I found relevant and important to middle class Singaporeans. Singaporeans who are making a decent monthly salary and are don’t always receive much benefits and support from the government.

Last night, I spent 2 hours catching up on the Singapore Budget 2019, making notes of the opportunities and insights that were mentioned by Mr Heng Swee Keat during his speech.

Let’s get the goodies that the government is dishing out this year that middle income Singaporeans will and will not be getting.

No GST vouchers for middle income Singaporeans

This year, only Singaporeans aged 21 and above, who earned an income of up to S$28,000 in 2017, are eligible for the GST Voucher payout.

If their home’s annual value at the end of 2018 was S$13,000 or below, they will receive S$300. If their home’s annual value at the end of 2018 was more than S$13,000 but no more than S$21,000, they will receive S$150.

Personally, I have no issue with this because the payout is not a lot of money in the first place. With or without this payout will not make a difference to my financial lifestyle.

In fact, I consider myself lucky to be in a situation where I don’t need this payout. So let’s not get salty about this okay? 🙂

Working adults get 50% personal income tax rebate (capped at $200)

This is a small win for middle income Singaporeans because we actually qualify for this. But let’s put this into perspective.

For someone who has a taxable income of $50,000 after relief and deductions, the income tax payable will be reduced from $1,250 to $1,050. Assuming the income tax is paid interest-free through GIRO for 12 months, the tax paid each month would be reduced from $104.16 to $87.50 ($16.66 difference).

If your taxable income works out to be more than $50,000, this rebate of $200 can become quite insignificant.

Now let’s look at things that I believe many financial bloggers will not be writing about Singapore Budget 2019.

In case you haven’t noticed, Mr Heng has given us a lot of clues about where the economy is heading in the next few years and how the government intends to shape our country to adapt to the changing global landscape.

Use Industry Transformation Maps to anticipate where your industry is heading

Under the S$4.5 billion Industry Transformation Programme, the Future Economy Council (FEC) that is currently led by our Finance Minister, Mr Heng Swee Keat has developed 23 Industry Transformation Maps (ITMs) to address issues within each industry and deepen partnerships between Government, firms, industries, trade associations and chambers.

Based on the industry that you are in, you can examine your industry’s ITM to have a general understanding of what businesses will need to do in the next few years.

As an employee, you can anticipate what your company (or other future employers) will need and start picking up specific skillsets to stay relevant in the job market. This will also increase your chances of getting promoted too!

For business owners, the ITMs help to identify future business needs. By pivoting your business capabilities and expertise around these business needs will increase your chances of thriving in the tough business landscape.

Reskill yourself for the jobs of tomorrow

For some middle income Singaporeans, the jobs that they hold may risk becoming irrelevant in the near future as businesses are moving towards what Mr Heng calls manpower-lean solutions.

While we are not getting more SkillsFuture credits, what was highlighted in the budget speech are the addition of new Professional Conversion Program (PCP) in new growth areas – blockchain, embedded software and prefabrication.

Today, there are more than 100 PCPs in 30 sectors that we can tap on to learn new skills for mid-career changes and prepare ourselves for the jobs of tomorrow.


For middle class Singaporeans, I feel that Singapore Budget 2019 has focused on helping businesses and industries thrive in the competitive global economy and providing Singaporeans with ample opportunities with pivot themselves to stay relevant.