The govt has been frightening us that many S'poreans do not have enough for retirement. Thus they have to lock up our CPF, forcefully make us buy CPF Life ....etc. They are so desperate to 'help' us that they came out with schemes to unlock our money tied up in our HDB flat. After their reverse mortgage scheme failed, as it got our folks into more trouble instead - what with interest payment and losing their flat when the financial institution take possession of the flat when property price plunged, - now they replace it with lease buy back scheme.
Sigh - another ponzi scheme to divert more money into CPF. If a person sell his lease to HDB, the $100 to $200K will go back directly into CPF to buy CPF Life. They have the cheek to tell us that they are giving us $20K as 'incentive'. Out of this $20K, $5K goes into CPF again. So let say the lease is worth $100K, a person would expect to receive $120K with the govt 'incentive'. But the fact is he only gets $15K in cash and $105K is lock up forever in his CPF!
Besides, the 20K is NOT an incentive as HDB market valuation is normally $10K+ less than market price ! All these sound so much like a ponzi scheme, yet when it is implemented by the govt, it is perfectly legal.
Now if a person at 55 is in financial difficulty and CPF Life payment only starts only at 65, how is he suppose to survive for the next 10 years on the $15K cash after he sells his lease? How long will $15K last him even if he is in perfect health condition ? 1 to 2 years at most.
If our citizens do not have enough money for retirement, it is a clear reflection of the failure of various govt policies under PAP. We have worked and saved for our whole life, but never able to catch up with the soaring HDB price and high inflation rate. CPF interest rate has been below our inflation rate for the last 2 decades.
The soaring HDB price which formal Minister Mah BT insisted is 'affordable' based on his skewed statistic and interpretation, has gotten so much out of control that it is hard to reverse it without dire consequence.
Recently our Finance Minister said we can buy a HDB flat on $1K salary. He instantly became the laughing stock in internet discussion. There was a discussion in Money Mind over CNA on financial planning. The panel advised to one of the callers was not to get a flat with $1K salary. Could it be that person heard what Finance Minister said and was fool enough to belief him ?
Then they also encourage folks to downgrade to smaller flat. As usual the 20K 'incentive' is given as a carrot. The price difference between 3 to 4 rooms and 4 to 5 rooms is about 100K. What with the legal fee, admin fee, GST, renovation, moving cost...how much does one get at the end of the day ? Then there is also COV to content with. So one has to balance the COV careful when one sells and buys a flat in open market. If not one will end up getting into more financial difficulties for all the trouble trying to unlock cash from his property.
If one goes through HDB - there is a levy of 40k (for 4 rooms). This is more than the 20K 'incentive' that the govt offers !
Are these schemes really helping the needy ?