Title: Housing prices: Worry over impact on retirement savings
Source of news: the Straits Times Forum
Name of article writer: Kang Choon Tian
Date of the article: Jan 30, 2010
Summary:
In this letter, the author worries that when people get old, they cannot afford to pay off the house loan and interest with little retirement savings in 20 years to 30 years. He calculates how much money have to pay for the house and sums up people may meet some change in their live in 20 to 30 years for the loan in order to show that the little retirment savings bring problems.
Comments:
I think the problem the author gives us is quite worth to concern about. Although the policy buying house with loan lasted for 20 to 30 years seems can help people to afford the house price, the government ignores the fact that the poor savings of retirees. I agree with the author’s opinion that the Singapore government should care more about the retirees and give them more money to maintain their life. The ignorance of the old people’s life may cause the people lose faith to the government. The old people have made great contributions to the whole society and they should be respected and concerned more by the society although they cannot be as competitive as the young people. The new policy should be carried out to give hope to those retirees who are struggling for their live with little money.
I think the problem the author gives us is quite worth to concern about. Although the policy buying house with loan lasted for 20 to 30 years seems can help people to afford the house price, the government ignores the fact that the poor savings of retirees. I agree with the author’s opinion that the Singapore government should care more about the retirees and give them more money to maintain their life. The ignorance of the old people’s life may cause the people lose faith to the government. The old people have made great contributions to the whole society and they should be respected and concerned more by the society although they cannot be as competitive as the young people. The new policy should be carried out to give hope to those retirees who are struggling for their live with little money.
The article:
Housing prices: Worry over impact on retirement savings
WITH prices of new three- and four-room flats reaching between $250,000 and $330,000 in some areas, I wonder how much a buyer will have in his CPF retirement account after paying for the flat in 20 to 30 years.
I took a loan of $80,000 some 20 years back and the interest came up to $70,000 when I had finished paying for my flat.
The Government should look into this or Singapore may end up with many retirees with little in their CPF account, assuming an average household income of $3,000 to $4,000. Since HDB flat buyers may use 30 per cent of household income, they may be able to service their loans, but little is left for retirement. Besides, along the way, husband or wife may lose their jobs.
Buyers are allowed to take up to a 30-year loan. By then, their earning power may also diminish when they reach 60, assuming they bought their flat in the early 30s.
Since there are many in this income bracket, I hope some financial experts will be able give their take on this important issue or Singapore may end up with many retirees with little to live on. Many buyers are not aware of the final price of their flat, including the interest over 30 years.
Kang Choon Tian
WITH prices of new three- and four-room flats reaching between $250,000 and $330,000 in some areas, I wonder how much a buyer will have in his CPF retirement account after paying for the flat in 20 to 30 years.
I took a loan of $80,000 some 20 years back and the interest came up to $70,000 when I had finished paying for my flat.
The Government should look into this or Singapore may end up with many retirees with little in their CPF account, assuming an average household income of $3,000 to $4,000. Since HDB flat buyers may use 30 per cent of household income, they may be able to service their loans, but little is left for retirement. Besides, along the way, husband or wife may lose their jobs.
Buyers are allowed to take up to a 30-year loan. By then, their earning power may also diminish when they reach 60, assuming they bought their flat in the early 30s.
Since there are many in this income bracket, I hope some financial experts will be able give their take on this important issue or Singapore may end up with many retirees with little to live on. Many buyers are not aware of the final price of their flat, including the interest over 30 years.
Kang Choon Tian
365 Geoffrey says
ReplyDeleteHousing prices is always a concerning topic no matter in China or Singapore. Everybody needs to have a flat to live in, but are all the people able to afford the prices? I agree with the author's opinion that in Singapore the retirees get a little money and have difficulty affording the loan. That's true because of Singapore's policy of the retirement. People who are retired cannot get much money, thus they must get enough saving when they are young. To solve this problem, I think we really need to look at Singapore's policy over the retirees. Why doesn't the government give enough money to the people who used to make a lot of contributions to the society. The official answer is that the society encourages people to work, instead of getting money just staying at home. When i heard this explaination one year ago, i was surprised. Singpore is a rich country, but not everyone are rich,there is a gap between the rich and poor and it seemingly diffeicult to step over that gap. Most countries in the world has benefit system. But Singapore chooses "no". The result shows a properious country, and it is indeed the same inside. But whether to rebuild the country's beneficial policy and narrow the distance between the rich and poor is needed to be discussed by the government. Will there be any changes? Will the normal people live in a flat without much pressure on their economic income? Will this kind of new disappear in Singopore? I think it should be considered...
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