Why SRS accounts are a good way to save

[CityFarmer]

Technically SRS has nothing to do with CPF. Retirment age is creeping up so those schemes pegged to statutory retirement age will be impacted. Under new RRA, you cannot force retirement before 62, and option to renew upto 65, and encourage to 67.

Sounds strange, meaning to say VBs' dream for early retirement will not be materialised? And if I choose not to work after my 50s, will I be penalised or put into jail?

I reckon you should know the "restriction" is on the employers, rather on employees. I have taken it as common sense.

[valuebuddies]

Technically SRS has nothing to do with CPF. Retirment age is creeping up so those schemes pegged to statutory retirement age will be impacted. Under new RRA, you cannot force retirement before 62, and option to renew upto 65, and encourage to 67.

Sounds strange, meaning to say VBs' dream for early retirement will not be materialised? And if I choose not to work after my 50s, will I be penalised or put into jail?

I reckon you should know the "restriction" is on the employers, rather on employees. I have taken it as common sense.

I think it is not a "restriction", there are many reasons an employer can gives for retrenchment, and in most of the case, no reason is actually needed. So question is back to as to what is the importance of the statutory retirement age, when the main scheme "CPF" is not relevant to the statutory retirement age?

[egghead]

You either change the draw down age from 65 to later or increase minimum sum. The eventual purpose is to ensure that there is sufficient fund to provide for a minimum living expenses for the years when we stop working.

As for your "suggestion" that employers can use retrenchment to bypass retirement age, I believe these employers are the minority.

[pantoo]

for those who are still skeptical, I've just did my first $50 contribution and the screen from OCBC reads "You can make a withdrawal without paying a penalty to IRAS on or after dd mmm 2046".

I'm born in 1984.

[valuebuddies]

You either change the draw down age from 65 to later or increase minimum sum. The eventual purpose is to ensure that there is sufficient fund to provide for a minimum living expenses for the years when we stop working.

As for your "suggestion" that employers can use retrenchment to bypass retirement age, I believe these employers are the minority.

What I am saying is that having a statutory retirement age doesn't protect an employee from retrenchment before 62, and also doesn't limit an employee from working after 62. And the holy number of "62" being the statutory retirement age has got nothing to do with CPF withdrawal.

So what is the point to determine such statutory retirement age? And am I right to say that for those people who doesn't has SRS, a statutory retirement age of 62 or 83 cause no impact on them? And if such, why am I so foolish to open an SRS account with the primary intention to attempt to lock in my statutory retirement age?

Please don't take this as a joke as I simply find it confusing and too complicated for me to digest at my age.

[thor666]

Hi valuebuddies, the intent is not to lock in the statutory retirement age; rather, intent is to lock in the effective SRS withdrawal age.

I suppose the wording of the SRS could help been better written..

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[CCUV]

All the good things been said about SRS but have anyone considered the "shift in goal post" by the government. I think the shift in goal post in CPF is very well documented, from cpf investment bank buying share(last time every single dollar can go into stocks,to only 30% after meeting 20-40K min), extension of retirement age(they have being doing it), from capping withdrawn of housing use from special account,medisave life,cpf life etc. All these are sign that no policy regarding cpf including SRS are spare in the future. I can think of one potential rule change,for e.g withdrawal penalty are increase from 5 to 10% etc. I am abit wary of most government scheme. The good scheme might be one smart alex wanting to meet his KPI from turning bad. Food for thot

[SpaceX]

What will happen to it if the SRS account holder died? Is that still taxable?

[egghead]

What I am saying is that having a statutory retirement age doesn't protect an employee from retrenchment before 62, and also doesn't limit an employee from working after 62. And the holy number of "62" being the statutory retirement age has got nothing to do with CPF withdrawal.

The statutory retirement age protects you (assuming you are employed) from being forced into retirement. Retirement and retrenchment are two different things and are treated differently in any organizations. If you insist on drawing your CPF from 62 instead of 55, no one is stopping you. You want the whole Singapore to withdraw later just because of you?

So what is the point to determine such statutory retirement age? And am I right to say that for those people who doesn't has SRS, a statutory retirement age of 62 or 83 cause no impact on them? And if such, why am I so foolish to open an SRS account with the primary intention to attempt to lock in my statutory retirement age?

The statutory retirement age protects the employed. Why don't you talk to those 61 years old senior who are still healthy and want to continue working to find out how the statutory retirement age is affecting them?

As thor666 mentioned, you don't lock in statutory retirement age; you lock in SRS withdrawal age.

[egghead]

All the good things been said about SRS but have anyone considered the "shift in goal post" by the government. I think the shift in goal post in CPF is very well documented, from cpf investment bank buying share(last time every single dollar can go into stocks,to only 30% after meeting 20-40K min), extension of retirement age(they have being doing it), from capping withdrawn of housing use from special account,medisave life,cpf life etc. All these are sign that no policy regarding cpf including SRS are spare in the future. I can think of one potential rule change,for e.g withdrawal penalty are increase from 5 to 10% etc. I am abit wary of most government scheme. The good scheme might be one smart alex wanting to meet his KPI from turning bad. Food for thot

If you look at all the adjustments to CPF you mentioned, they were done in response to situation and circumstances. If you choose to call it shifting of goal posts, it means you do not understand why those changes were made.