Truth Exposed: The Dirty CPF-HDB Scheme To Trick Singaporeans

By Singapore Singaporeans and Roy Ngerng

(Please note that this is a two-page article.)

Page 1, 2

There is something very insidious about the CPF – something that they have never told you. Today, let’s uncover the truth about the CPF and find out its true colours for ourselves.

Let’s jump straight in.

Do you know that if you had started work at the age of 21 in 2001 and earn a median wage, by the time you are 55, you should have accumulated almost $700,000 in your Ordinary and Special Account (OSA) (Chart 1)?


Chart 1

But why is this not happening to many Singaporeans?

According to Leong Sze Hian, he estimated that only 1 in 8 Singaporeans are able to meet the CPF Minimum Sum and are able to retire.

It has also been shown by 3 studies that Singaporeans have the least adequate pension funds.


Chart 2: Developing Asia’s Pension Systems and Old-Age Income Support


Chart 3: Melbourne Mercer Global Pension Index


Chart 4: Pensions at a Glance Asia/Pacific 2011

But, why do Singaporeans have the least adequate pension funds compared to anywhere else in the world, when Singaporeans actually contribute the highest proportion of our wages into CPF? The maths simply doesn’t square.

Manulife had also shown that as compared to the other Asian tigers, Singaporeans are made to set aside the largest proportion of our wages to CPF, leaving us with the smallest purchasing power.


Chart 5: Manulife Asset Management Asset rich, income poor? Key components of retirement income security for aging Asia

Let’s break down the reasons why for you.

Singaporeans Are Forced To Pay The Highest CPF Contribution Rates But The PAP Gives The Lowest Returns In The World

First, you need to know that the most basic reason why Singaporeans have such inadequate pension funds in our CPF is because of the low interest rates.

Singaporeans might pay the highest CPF contribution rates in the world (Chart 6).


Chart 6: Social Security Programs Throughout the WorldSocial Security Programs Throughout the World: Asia and the Pacific, 2012Social Security Programs Throughout the World: Europe, 2012Social Security Programs Throughout the World: The Americas, 2011Social Security Programs Throughout the World: Africa, 2013Coordinating Healthcare and Pension Policies: An Exploratory Study

But as I had written about before, Singaporeans also most likely earn the lowest interest in the world.


Chart 7: Mandatory Provident Fund Schemes Authority A 10-year Investment Performance Review of the MPF System (1 December 2000 – 31 December 2010), Interest Rate Declared on Provident Fund Accumulations Since 1952, Mandatory Provident Fund Schemes Authority A 10-year Investment Performance Review of the MPF System (1 December 2000 – 31 December 2010), Employees Provident Fund Dividend Rate

This would explain why even though we had to set aside such a large chunk of our wages into the CPF – 37% to be exact – our pension funds is actually one of the least adequate in the world!

This is what it actually means – the CPF contribution is from our wages and the CPF interest rates is from the government. So, what is really happening is that Singaporeans are made to part with the largest chunk of our wages in the world to CPF while the government gives the lowest interest rates anywhere in the world. Singaporeans are made to give the most and the PAP allows themselves to give the least (Chart 7).


Chart 7

And as explained, the PAP has taken our CPF to invest in Temasek Holdings and GIC – they have earned an interest of 16% and 6.5% respectively. Since they are using our CPF and earning such high interest but we are only getting back 2.5% to 4%, this means that what we are receiving is very low – we are not getting back the returns on our CPF that we should from these investments. This means that the interest that is not returned to us is actually an implicit tax that the PAP is making Singaporeans pay, on top of our CPF (Chart 8).


Chart 8

So, here’s the first reason why Singaporeans have the least adequate pension funds – the PAP takes out too much of our wages into CPF but gives us too little back in return. Why do they need to take so much of our money away for themselves for?

But the next reason is what is more important and would shock you.

How Using Your CPF To Buy A HDB Flat Entraps Singaporeans

Singaporeans are also able to use the CPF to purchase their homes.

I will go quickly through the maths but you don’t have to get too engrossed with the technicalities. Just try to see the whole picture.

So, assuming that we want to buy a new HDB flat at $300,000, we would put down a 20% downpayment of $60,000. 15% or $45,000 can be paid using the CPF (Chart 9).


Chart 9

Take note of the CPF amounts.

For the rest of the 80% or $240,000, if we were to also use the CPF to pay for it, we would need to pay a monthly mortgage of $961 for the next 30 years.

After fully paying for this mortgage for 30 years, we would have paid out $345,960 in mortgage (Chart 10).


Chart 10

In total, this means that we would have paid $405,960 for the flat (downpayment of $60,000 and total mortgage of $345,960).

At first glance, we might think we need to pay only $405,960, or about $100,000 more than the actual “value” of the $300,000 flat (Chart 11).


Chart 11

But actually, you are paying a lot more than that – read further. Now, this is where things get even scarier.

The PAP Tricks Singaporeans Into Paying Additional Interest Rates For Nothing

What do you mean I have to pay more than the downpayment and mortgage that I have already finished paying off? How can there be any more money that I need to pay?

This is because there are some things that the PAP has not told you upfront (or you might have missed amidst all the confusion that they have intentionally created).

When you take money out from your CPF to pay for the mortgage, when this money is taken out, you wouldn’t be able to earn interest on this money since the money is taken out, right? – which is understandable. What this means is that the government won’t need to pay you this interest and you won’t be able to earn interest.

So, that’s the easy part. Here is what you have not been told.

Now, what the PAP has then said is this – since you have taken this money out and are not able to earn the interest, you will now have to pay the interest back into your CPF. You will have to pay the 2.5% interest that is “lost” back into the CPF.

The PAP calls this the CPF accrued interest. This is what the PAP says: “If you sell your HDB flat, you need to refund the principal amount you had earlier withdrawn for the purchase of the flat, including the accrued interest, to your CPF account. This interest is the amount you would have earned, had the savings not been taken out.” Wait, no one ever told me about this! I thought it’s only the mortgage!

So, see if you get this – if you had left your money inside the CPF, the government will pay the interest. But when you take the money out, the government wants you to pay the interest back. In the first place, since you have taken the money out, the interest can no longer be earned and even if the government wants you to earn the interest, they should be the one paying the interest, right?

Well, you are right. The basic principle works like this – if you decide to put your money into a bank, it is the bank that would pay you interest. And if you take your money out, the bank doesn’t pay anymore interest to you. Obviously, you don’t have to pay interest to the bank on money that is no longer there.

So, similarly, if we had taken our money out from CPF, the government stops paying interest to you.

But why is the PAP then making you pay “back” the 2.5% interest that they should be paying? Now, note this – what this means is that you are paying an interest of 2.5% on money that is no longer in the CPF. You are paying an interest into the CPF on nothing (Chart 12).

You have to fork out money from your own pockets to put into the CPF for the government.


Chart 12

Do you see it? The government makes you think that if you want to grow your retirement fund, you should put the money back.

  1. First, if you should put any money back, it should be because you have additional savings which you want to save and decide to put into the “bank”. It should not be to put interest back on money you don’t have or even own inside.
  2. Second, you should be the one who decides whether to put the money into the “bank” or not. It shouldn’t be a forced entrapment plan.
  3. Third, why did the government tie in the CPF interest rates to the HDB mortgage, when they are two separate things?

Remember this – (1) the government is making you pay “back” a redundant interest rate which in fact, they should be the ones paying you and (2) the government has concocted a plan to make you pay them what they term as “CPF interest that you have lost” when it’s simply a plan to make you pay them so that they can earn.

This is nothing but trickery.

The PAP Turns Your CPF Into Their Bank To Lend Money To You On Interest

But here’s another way to look at it.

By asking you to “return” the 2.5% interest, the government is effectively saying that the money inside the CPF is money they are lending to you to pay for your mortgage, which is why they had then made you pay an interest on it. What this means is that they had taken over your CPF and made themselves the moneylenders of your CPF. Effectively, they have taken over your CPF, act as if they own it and decide that if you want to take your CPF money to use, they get to decide on the terms they want to lend the money to you – but money which is yours in the first place (Chart 13).


Chart 13

But why do you have to “borrow” money from yourself and pay “interest” to yourself on money that is yours in the first place? If I have a dollar in my piggy bank, when I take the dollar out to use, do I need to keep paying an interest for everyday I do not put the dollar back? I get to decide what I want to do with the piggy bank, don’t I? I get to decide when I want to put the dollar back, interest or no interest.

Thus who gave the PAP the mandate turn our CPF into their bank and act as if the money inside is theirs, which they can set an interest on and earn from us? Let’s be very clear – we are using our own money to pay for the HDB flat, not some non-existent money.

And if indeed an interest needs to be charged, isn’t there already a 2.6% interest that we are already paying on the mortgage? Why are we made to pay an additional 2.5%? What the PAP is doing is this – they are making us pay a 2.6% interest to their HDB bank and then make us pay another 2.5% interest to their CPF bank! What this means is that we are actually paying at least a 5.1% interest, which is a very high interest rate (Chart 14)!


Chart 14

Where on earth do you get a bank(s) that is so corrupted beyond its means that it doesn’t even tell you the truth of where your money is going but keeps you in the dark until the truth hits you when it is too late, and you’ve lost much of your money?

Do you see what is happening here?

  1. When it is convenient, the PAP will tell you that the CPF is your money and you own it. But when they feel like it, the PAP says that the CPF is their money – they get to invest it anyway they like it, and they get to turn your CPF into their bank and decide to lend you on added interest, as and how they like it.
  2. The CPF then double-charges interest on the CPF you withdraw for the mortgage, by first charging an interest on the mortgage and then charging an interest on the CPF withdrawn for the mortgage (Chart 15).


Chart 15

Meanwhile, who keeps losing money and who keeps earning money for free? Do they need to do anything to earn you money? They don’t – all these money that they extract from you is now automatic.

But do you know why the PAP does this? They have already made you pay such a massive chunk of your wages into the CPF – all this money is precious money that they want to use for their own investments. If you are allowed to take it out, it means money that they have to lose, which they cannot use. So they have to find ways to extract more out from your CPF, to give to themselves, rather than to you.

You Are Actually Paying More Than 2 Times The Value Of Your Flat

Then, you might think – fine, no choice what. The government wants to do what, we also cannot speak out, so let them do lor.

It’s only a 2.5% accrued interest right? Suck thumb lor.

Here’s how much 2.5% is.

First, do you remember the 15% downpayment of $45,000 that you had used your CPF to pay? Yes, you have to pay a 2.5% accrued interest on this as well. Do you know how much the 2.5% CPF accrued interest that you have to pay back is? By the end of 30 years, it is $47,812.

Yes, no kidding. The CPF accrued interest that you have to pay back is more than the downpayment that you had paid (Chart 16).


Chart 16

Getting scared?

Next, you had taken a mortgage of $345,960 from CPF for 30 years to pay for your flat right? Here’s how much CPF accrued interest you have to pay back – a whooping $172,983 in CPF accrued interest, or half the mortgage (Chart 17)!


Chart 17

In total, you would need to pay a total CPF accrued interest of $220,795 (CPF accrued interest on downpayment of $47,812 and accrued interest on mortgage of $172,983) (Chart 18)!


Chart 18

Now, note that the CPF accrued interest I’ve shown you so far is only at the 30-years mark. But do you know that as long as you do not pay this CPF accrued interest back to the CPF, this accrued interest just keeps growing

So it doesn’t stop there.

Most people never know about this CPF accrued interest, so they wouldn’t have paid “back” this accrued interest and so, this CPF accrued interest would keep growing. In fact, you most likely would only see any mention of this “accrued interest” on the CPF website which informs you of what you need to pay back when you sell your house.

If the accrued interest keeps growing until the 40 year mark, it would have grown to $396,339, or more than the stated value of the flat of $300,000!

And after 50 years, it would have grown to $621,051, or more than twice the stated value of the flat (Chart 19)! Now do you know why most Singaporeans would never be able to retire?


Chart 19

Let me give you a bit of perspective. Initially, you had thought that together with the mortgage, you are only paying $405,960 for the flat right? But when you add in the CPF accrued interest of $220,795 at the 30 year point, the total amount that you are actually paying for your $300,000 flat would be $626,755.

So, after the 30 year point, your mortgage would have ended but you still have to continue to pay because the CPF accrued interest keeps increasing and increasing non-stop! After 50 years, your $300,000 flat would cost $1,027,011 (Chart 20)!

The “mortgage” never ends! The PAP has devised an insidious scheme to make you keep paying (without you knowing) so that your CPF keeps dwindling (for their use).


Chart 20

Get this – this is a $300,000 flat and how much are you paying? You are actually paying more than twice that amount – or $626,755 for that flat (Chart 21).


Chart 21

And if you never pay this interest back since you wouldn’t know about it anyway, at 40 years, you flat would have cost you $802,299 and at 50 years, the flat would have cost you more than $1 million – or more than 3 times how much the flat is said to cost (Chart 22).


Chart 22

By now, there should be a lot of question marks above your head now. Most people do not know about this CPF accrued interest that they have to “pay back” until they have to sell their flat. Only then will they be informed about this and only then will they get the shock of their lives.

I bought a flat for $300,000 and I have to pay more than $600,000 for it after 30 years?? And a million after 50 years??? I could have bought a high-end condominium!

Mind-blowing? Not even there yet.

Paying $600,000 For A Flat For Nothing, Literally

Now, when we buy a flat, what we would think is that after I finish paying for my mortgage after 30 years, I would be debt free and I would be able to start saving for my retirement, right?

In fact, that’s what a mortgage should mean, shouldn’t it? You finish paying and then, that’s it. In fact, you own your home now! That’s what the PAP has been selling to us all this while. This is our home!

So, as if it’s not bad enough that you are actually double-paying for your home, it was recently revealed via a question by the Worker’s Party Gerald Giam that your flat will have zero value at the end of its lease.

Can someone please explain to me why we have to pay $600,000 (after 30 years) on a $300,000 for a flat that has absolutely no value at the end of its lease? Then what the hell are we even paying for? So, your flat is supposed to increase in value but after the end of the lease, this value suddenly disappears (Chart 23)?


Chart 23

What kind of home are we buying to stay for the rest of our lives, and for our children, if it has absolutely no worth? Then why are we even buying the flat??

Why are we dumping all that money into something which is worthless? Why are we spending $1 million for literally nothing?

The PAP Tricks Singaporeans Into Paying Interest For Their Own Use

By now, if this hasn’t shocked you or infuriated you, I don’t know what will.

First, now you know that you have to pay this mysterious 2.5% accrued interest on the mortgage you take out from the CPF.

Then next, you find out that this mysterious 2.5% will actually amount to more than $200,000 after 30 years and more than $600,000 after 50 years – no small amount! $600,000 would have allowed you to retire very comfortably! $600,000 that you are dumping because no one told you anything about this!

Third, you then find out that this mysterious 2.5% will actually make your flat cost more than $600,000, or more than twice the stated value of $300,000 (Chart 24).


Chart 24

And as we have explained, there is absolutely no need for you to pay this 2.5% “accrued” interest at all because you would be paying this interest on nothing – there’s no money to pay this interest on. In fact, it’s only a trickery that the PAP has concocted to make you give them money for free.

Page 1, 2


  1. Pingback: Thoughts on CPF and Update Thirteen of Defamation Funds | The Heart Truths
  2. Matthias Er

    You can always earn more and use cash to pay if you want to avoid this which you deem is corrupted. Go find ways to make more money. Improve your skillset and aim to live independent of the cpf if you find that it is a thorn in your flesh. There is always some compromise, so stop whining.

    • JL

      It’s a waste of time explaining things to these people who will only atatck you and call you childish names. Theses whiners will never see it from your empowered point of view (of a winner) and will only complain and complain (like the losers they are). They believe the nonsensical rubbish that Roy sprouts and enjoy putting the blame all of their woes on the government when the very reason they are a failure is themselves (yes pls look in the mirror).

      They fantasize that if they put the opposition or idiots like Roy into power, suddenly their economic situation will be better. Thank goodness common sense reins with the 60% to 70% and we keep good and responsible government (they will ever ever admit it) where they should be, in power.

    • IAN KOH

      @Matthias Er. You are missing the point of the article. It is simply analyzing and breaking down the technicalities behind the CPF scheme to allow the people to understand the truth behind the scheme, and how it runs. Try to have a more open mind, and not limit yourself to judge others so vividly. I think Singapore would be a much better place if everyone can learn to embrace varying opinions, and allow the differences in views to add zest and vibrance to our culture instead of creating dissent.

  3. SG Hunter

    Although not totally apparent, its a systemic problem that flows in one direction into PAP pockets. This is the tax that Singaporeans are willing to pay knowingly or unknowingly. Capital controls, eligibility controls & rules etc… is a socialism that applies to average Singaporeans. One needs to make more $$$ than the this tax. Its swim or die.

  4. The Objectivist Singapore

    If one possessed the moral and legal right to his own property, he would be free to reinvest in another field, lest he decides that his current investment should not be yielding such abysmal returns. The problem here is that the state claims both moral and legal right over the individual’s property, citing the oft repeated phrase of “for your own good” and forcing it upon you whether you like it or not. When the fundamental constant is force, it makes no difference whether the opposing party is the state or a robber: would a robber be more justified in robbery if the legislature made it legal? It is in that regard that all taxation, all manner of laying claim to a sovereign individual’s property (be it to “invest” or to “bank”) is theft, albeit legalized theft.

    One must first reclaim moral righteousness back from the hands of the statists.

  5. Daniel

    Roy, you are an absolute frog in the well.
    Why are you still living in singapore when the green is much greener over at the other fences?

    Accept the system and structure and earn your stay here.

    Singapore is unique. Singapore is a land without natural resources and have progressed so far because the leadership has been capable and thr people who believed in the system worked hard and smart towards better finances.

    There is room to improve no matter how well we have done.

    Shape up or ship out – you socially disruptive m*r*n.

  6. L

    Let’s tear this piece of misinformation down shall we?

    Chart 1, source please. Giving unsourced calculations a chart does not make it any more credible.

    Chart 2, replacement rate means your pre-retirement income vs. your post-retirement income. Singapore has a cap to retirement pension as it is meant for meeting minimum standard of living and not for you to live a luxury life (which you should be saving up yourself for). And Singapore has a pretty high top 1%. That means their pre-retirement income (10k+) would be translated to a less than 2k cap. It doesn’t matter for them as they should have plenty of savings. But it makes the replacement rate graph you made meaningless. Besides, the replacement rate only takes account for the minimum pension which would become higher if you did not spend all that you can for housing and healthcare.

    Chart 3, Singapore is rated as the top few pension plans in the world in your source. And you cheery picked the lowest metric out of adequacy (mostly replacement rate again), sustainability (long time ability to keep the system going) and integrity (the cost of the pension system and how much you put in vs. how much you put out). Singapore scored lower on adequacy, and really high for the other two. Overall Singapore system is rated one of the top of the world.

    Chart 4, what is this graph’s horizontal axis again? There is no such graph in your source. I suspect it is replacement rate, again as the position of Indonesia and Malaysia seems eerily similar to where they are in this graph.

    Chart 5-6, we pay the most because we have the most complex and comprehensive coverage as shown in sources of chart 3-4 which are actually singing praises of Singapore’s system. Besides, in countries like Germany, you have insanely high income tax and it goes into pension fund as well, however, they are called income tax.

    Chart 7, more cheery picking! Mmmm… I am hungry. Hongkong’s 7.5% is from 2010-04-01 to 2010-12-31. I think even the writer dare not pick a location so closed to us and give a percentage like 30.1% from 2009-04-01 to 2010-03-31. Average of 10 years is 5.5% from his source. Still significantly higher than Singapore’s 2.5% right?! Oh wait, that is for the first $20,000 of your ordinary account (which is raised to 3.5% in 2015), And after that we have 5% interest until $60,000 and 6% from then on (

    Our system is not perfect, far from it. We can make suggestions to improve it. But man, your cherry picking is disgusting.

    Oh by the way, you completely lied about CPF accrued interest. Let me put it simply.
    2 people, A & B, having the same amount in CPF:
    Both has 10,000 to begin with.
    A did not withdraw, B withdrew 5000 for his HDB.
    A year later, A enjoyed 3.5% and now has 10,350 in his account.
    B now has 5175 with that same 3.5%.
    Now, B needs to pay back into his CPF (not the government, his own CPF) so he can enjoy the same pension.
    5000 is his initial account, 175 his CPF accrued interest. After that, he reaches 10,350 just like A.
    Now both live happily ever after.
    See how CPF accrued interest work now?

    The rest are basically blind rage about this CPF accrued interest he so sadly misunderstood.

  7. Observant Critic 33

    Quite a pretty bit of misinformation here. Here a couple obvious ones right off the bat:
    #1 SG’s low interest rates compared to other countries are simply due to the low interest rates for SGD. More details at the end of the post.

    #2 In the cost of mortgage, are double counting the 100k price increase due to interest and then in the extra 2.5% you have to pay back to yourself.

    #3 Temasek and GIC do not manage CPF funds. They are funded through taxes and government borrowing (government bonds) and other forms of government revenue. CPF as an entity, manages its own funds. CPF is a capital guaranteed fund, therefore it is invested in the lowest risk investments which provide very low rates of return. If you want to invest your CPF you are free to do so (with certain restrictions). However, we as a people have had a poor track record of investing. The average CPF money investor has made returns below 2.5%.

    My thoughts:
    Yes, the Singapore government is kind of like a helicopter parent. Imposing and unyielding, and does not let us make our own mistakes and harm ourselves. It is a trade off, restricting our own freedom to make our own decisions for our own finances to protect us from financial ruin. This, in theory, helps to achieve better social stability. I personally believe it would be an improvement if CPF were to be able to grant more avenues for conditional withdrawal of funds, which they are beginning to approach which is a good thing.

    Do approach your local MP, or write in to CPF, if you want to affect change in the way CPF is being operated. Or, you may join the public service as well. That is the correct way to affect change. It is inappropriate to post misleading and inaccurate information to sway others to your motive. It also weakens your argument when people do begin to take you seriously and start poking holes in your arguments like I am doing now.

    Continuation from #1:
    As you might have known with a little bit of basic finance knowledge, high interest rate currencies depreciate more compared to low interest rate currencies. The reason SGD is low because Singapore adopts a foreign currency policy instead of an interest rate policy unlike some other countries, and for the past few years in particular, a gradual appreciation of the SGD, which caused low interest rates for the SGD. If you prefer the Malaysian Ringgit go ahead and convert your SGD and put in RM deposits, their interest rates are high, and depreciation rates are sky high as well.

    • Jerry

      In your paragraph “MY THOUGHTS” you mentioned HELICOPTOR PARENTS” I’m sure your also have a family with kids. If your kids wanted to borrow money from you to buy a house would you charged them interest? I’m sure as a parent you would go all out to finance them and won’t charge them interest right? As a Singaporean, (Born Singaporean. Not adopted) served National Service for a token sum set by the government (supposed to be our father) which is about one third of what we’re supposed to earn in the private sector, why can’t the government (our father) charge us one third of the commercial interest rate for loan. Only know how to take and don’t know how to give.

      • Barry

        Charge them monetary interest of course not! What kind of shitty parent does that. However, at the end of the day, payment for a house for your kid is taking money away from your own retirement fund. You are investing in your child with the “interest” or “return on investment” being they will take care of you when you are older.

        If you are part of the lucky few where your parent’s retirement fund is substantial enough that an endowment sufficient to buy a new house means nothing to them, then great, your logic is sound jerry. But for majority of people, whose parents are sacrificing a sizeable portion of their retirement fund to reduce your monthly expenditure on rent increasing your own personal expendable income, the parents are doing so on the implicit expectation that you the child will support them during their retirement financially or otherwise on the basis of filial piety ingrained in our social fabric.

        Same thing here, if you’re taking the money out of the CPF, as poorly executed as one might argue, a mechanism designed with the intended purpose of supporting you in your retirement, you are borrowing money from your own retirement fund and you are paying yourself back this 2.5% interest to support future you.

        The situation is the same, the principles are the same, the only difference is the lender (parents v cpf) and the mode of repayment (supporting your parents v your own cpf). At the end of the day, if you perform an accurate audit, taking into account as best you can intangible value you have to return to your parents, the total value expensed either way is comparable.

  8. piggy

    This guy must had failed his maths during sch time….
    1. Do you live in same HDB for 40 or 50 yrs? If yes, then you must be damn poor and stupid as dumbass in Singapore.
    2. Accured interest is not calculated as total sum of withdrawal lah… Troll

  9. Allan

    Yes I Agee to this but so call the “Government” will used the 5 Singapore National Law against the person and which cannot over come the act of laws … the worse of Singaporean are the person who refuses to face reality or confront a problem.

  10. Ahmad

    The guy who uses tons of statistics to slowly confuse stupid readers and then write up bullshit to completely drown the PAP in shit. Only people who fail classes are overwhelmed by graphs and charts believing everything you wrote blindly without actual knowledge.

  11. John Ong

    L’s explanation is spot on. The whole point of accrued interest is to make sure that, after you buy and sell your flat, you have the same amount of money in your CPF as someone who didn’t.

    The way you framed the issue is very misleading. In your post, you continually refer to the accrued interest as a sum that is “paid” to the government. That did not seem so bad until you added (1) the interest rate paid on the housing loan to (2) the rate at which interest on the funds are accrued, and then used that to calculate the “total interest paid”.

    (1) involves money that you will never get back – it is to compensate the government for letting you spend money that you don’t already have. This is standard practice in the private sector, except with higher interest rates.

    (2) involves money that you’re returning from the proceeds of the sale of your flat back into YOUR CPF. This is in no way similar to (1), where the money is no longer yours. There is a distinction between you paying someone, as in (1), and you being made to top up your savings at a certain rate, and have that cash held in someone else’s custody, as in (2). The misconception that (2) equates to (1) is what everything after Chart 13 is built on, and it is not a strong foundation.

    The framing of the issue lends very little credibility to what you’re saying. If there was an issue you could have addressed to be constructive, it would have been the guidance the government provides. Not everyone can time the sale of their flat optimally, which means the government could improve by advising people whether the sale of their flat would severely and adversely affect their CPF savings. Simply saying “don’t sell now” can signal people to wait until the housing prices are higher before selling, and seek any required funding from other sources. This can make sure they make enough from the sale of their flat to return the principal and accrued interest to CPF. Would this not be more constructive than calculating large sums using an incorrect frame of accrued interest, and then using emotive language to stir negative sentiment?

    Our government doesn’t get things right all the time, but I don’t see how posts like this help. Right now, as long as no one can prove that the government policies are bad, we can only choose between the alternatives out there. So, either tell the government where they’re wrong and offer a better alternative with proper justifications (unlike this post), or just help people make the best decisions they possibly can.

  12. AJ

    CPF Board or the PAP Government has to stop this accrued interest imposed. This are clearly daylight robbery!

  13. Curiosity

    If a $300k flat makes actual cost is around $1mil. The hdb sale market would be all trading above a million dude. Market is efficient. If your calculation is right, then sweep all the hdb that are on sale below a million. Ure making money! Undervalue!

  14. PC

    Have I miss out athg? Cash $15k and $45k via CPF. The balance $240k on mortgage loan. Where does $240k come from? Isn’t it from the spool of cpf contributors? Becos of the loan, investment revenue was affected right? How much investment loss affected? Have this been considered? So the pay back of 2.5% on the interest against the investment loss had it been not withdrawn for mortgage loan – isn’t it fair? 🤔🤔🤔

  15. Jeremy cheng

    Roy, what a load of crap you have written, firstly despite my limited knowledge on the CPF system Versus other countries systems, a face value search using Google will reveal that the information you have used to justify your argument is misleading. Simply put you used only a portion of the information and not the full context of what it actually is to back your claims. That itself makes you post questionable, the very fact you’re trying so hard to prove our system wrong reveals your misconceived bias towards the system without a fair evaluation.

    Secondly, since you’re so unhappy with the system Singapore has, please just get the hell out of our country and perhaps, go to Malaysia instead. Instead of trying so hard to effect change with your impractical bs.

  16. Nick

    And then there are multiple layering of taxes on top of taxes from the moment an HDB project is being built. Construction workers all got worker levies right? And it’s raising all the time. Now it’s like $700 per head? So who takes all these levy? Poor foreigner blue collar workers! What they take home is slightly more than their levy. And with transportation cost / logistical cost one of the highest in the world due to taxes over taxes ie: rental cost for companies/vehicle operation cost, what else can one expect? This trend of tax structure is never gonna come down…. In the long term, you’ll only see one graph pattern, a raising pattern. No wonder so many local construction firm have closed down for good. So many citizens sucked dry and high.

  17. Chong guat ngoh, alice

    My house was on fire on oct last year. I did see my PM Ms. TING PEI but l was only given my initial of $5000. My house was renovation cost me around 25k. I begged and even ask for eithet another 5k or 10k. But was totally rejected. I even gone to borrow from the cpf n they refered to 1 dept to another but due to l am staying in a massionate l am not qualify for. So my cousin use his credit cards to borrow the loan to settle my agonies. But his saving was lock up because his loan was over his income. It this our government? What is call democracy? Our govt say we r unity? The is our national pledge? People like me, l have no friend/s n my children left me because l was undergoing a lot of operation n even now my eye had problem and my pitituary gland has a tumor, my youngest son is a doctor n now singspore govt can afford to sent him for upgrading but having a good job and his family. I did whatsapp abt my problem. He had now aviod me totally. Our govt only wanted young people and lack of filial piety. What l have invested and my care with love to him is just only a mother to do.
    When my husband and chilren had taken all my money when they were afriad of my death in2005. When l was in hospitalise in 2006, l was so desperated n upset but my youngest son, Dr. Kelvin dare not to face me. At last l had to another person to be my husband and l only get partial of the money wanted to pay my hospital bill. But l cannot overcome my conscioudness l call police. But all doctors , staff and my cousin tried to reach my son, he instead ask the police to sent me to mental hospital and l was put in the prison. My lawyer n my cousin kept getting this youngest son to pay at least a visit but he never. The only time he visit me in the mental hospital was required by doctor. He look down on me as a ex- convict. He brought his family with two grand kids and buy me a dinner. His motives but maybe he know l was familar states. He want me to take care of his kids. Without wanting to pay a air ticket for me. I have study very hard in UC Berkeley, University of Auckland and well as in University of Melborne.
    I had a good job with UN and Greater New York. During my married to this husband, CHUA MENG KEE at the age of 18 yrd old lwas always being abused atmost violenty at all times. Actually when married me is a plot, after his divoced with 2 kids. Chua chi ming and Chua Jenny ( who is a teacher) but she had tried all ways and means to muliputing and instigating my 2 kid. Chua chi hoong and chua chi ming. I was too kind heart to let the former wife to come visit her children. At first she just only help but after sometime she beg to lend her 30k for buying a flat in Geylang East Ave 1 #04-81. Her name is madam Koh Siow Huay. This kind of lady kept poisoning my children while l was gone for upgrading at my youngest son was at primary 6. But every year l did come to take my kids for tour and spent my summer holidays with my kids. After my gradation, l stsrted an Employment agency, Multilink Expediting Pte Ltd with a very good reputation. Far before govt had set the rules of teaching maids n counselling of 2yrs services. My husband used this at an excuse and kept flirt around and even take my house as a brothel for over 6 yrs while l was do my studies.
    After l came back wanted my kids but she refused because l have given her $2000 per month just to take care the house chores. Other expeditures are paid by my alternate with my husband. Last but not least, while l was having colon cancer n under treatment, he had engaged a formor maid that my step daughty, Chua Jenny. ( she send this maid off because she had found out the maid is have affair with my husband) but lwas not aware. So before l came back, this maid already in my house. I had at utmost time saw my husband sleeping with my maid but l dare not to say a word. But 1 day, because of the maid is in my house and only accompanied my husband without doing any job. I only just say in Indonesian that she is becoming more daring. While l was sleeping in the middle of the night, out of sudden l was beaten by my husband and the maid and even kick me down from my massionstte. Our neighbour reported to police and l took a PPO again him. Yet he still kept harrassing and threathening me. A Transport company l started for him since 1977. He quickly changed to he and his ex-wife name.
    His ex-wife is his accomplice kept calling me on mental suffering. So my cousin had to act as my boyfriend and move to stay with me on double decker bed. As l know my husband is very strict and authentic traditional man who know my weakness that wanted me to be his salve so my cousin discussed with his wife and stay at my house as well as accompanied where l go.
    All my above- mentioned grivencess is not asking for anyone to empathize me.
    But why the govt still wanted me to paid him 20% of my last asset. Which my cousin had to sold off his house and paid for me. He had not contributed any thing to the family. All money come from l have earn by working 3 jobs a day to kept 8 people in family with good life. But why Singapore govt had not take into consideration on woman chapter and putted me in jail which l was all the time suppoting PAP. Because of getting into the prison and made a prospective with potential person to become stagnamt and rejected by Singaporean society because of ex-convict. I was so desperated so just 2 days before l tried to commit another stealing case. As my husband had threathen me cannot appear at my son wedding. Because during my son gradation, he forced my son not to let me attend his gradation as will disgace my son.
    It is singspore govt never bother to hear n trying to ask me on buy back scheme n lock my cpf and l get peanut bt the govt will had a greater piece.
    Now it seem that everyone is so worry about our CPF. But l sincere know Singapore govt also very paraniod and is under agonies too but at least if the govt are sincere n caring to we citizens. Give us partially of our cpf instead of lock for our kids if they dun deserve to have it.
    I hope those who had read this txt will understand l am opposing the govt but rather a lot of department PM are still stuck in their own opinions. Nothing about politics.
    With regards

  18. Taya Smith

    Great Loan Offer of only 2% interest Rate

    We are a private financial lender that offers unsecured loans with a 2% interest rate ranging from 6 months to 20 years which you can pay in installments.
    We offer loans of $5,000 – $5 million. Contact contact us with the following details and proceed.

    Full name:
    Social status:
    Contact Address:
    Monthly income:
    Loan required:
    Loan Period:
    phone number:
    The reason for the loan:

  19. Victorique

    Reblogged this on Dreamingmtthoughts and commented:
    And this just makes me even more likely to decide to emigrate by getting a chance to study abroad. Costs are nothing, when compared to having to put up with this.

  20. Agnes

    Dear Roy
    I love your video on the detailed dirty corrupted cpf hdb scheme
    Can you create a video on the devious corrupted medishield life & the retirement payout too?
    I have been going to cpf and sending them nasty email on their explanation on how they calculated their retirement payout, and as of now cpf could not produce the spreadsheet on how their calculation based on their formula works out.
    I’ve question them time & time again for the detailed spreadsheet, which they could not produce
    I’ve read in Wikipedia that you are based in Taiwan, have you given up your citizenship?
    Sorry I do not have a facebook account.

  21. Ash

    Hi roy,
    A piece of advise don’t need to waste your life fighting for Singaporeans who still think we have the best system in the world. Let it go and enjoy your life. Rather then be a political prisoner. Just let it go bro. The smart ones will leave SG.

  22. xbao

    Very good but what is the bloody point when everyone still keep voting pap? People the problem, people know the problem but people don’t want do fk to remove the problem. That is what you need to solve. Everyone alr know how they eat our money just that no one wanna change things.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s