Reaping what you sow with Kelvin Koh.

What are our golden years??

For those wondering what our golden years are, which is what I referred to in my introduction, they’re our retirement years. Generally speaking, they’re the ages between 65 and 80. As much as we’d like to brush the matter aside, we have to admit that we’re getting older and even though it seems like a long time away, we have to plan for it. The best way is to make sure your finances are in order and that’s where the CPF comes in.?

What is CPF?

The CPF stands for the Central Provident Fund Board in Singapore. Most Singaporeans may have heard of the term but unless you’ve already started contributing to it, you may not know exactly how it can help you. That’s what financial literacy is all about, teaching you things about finance that can potentially help you.?

• First off, it’s important to note that the CPF is credited with 20% of your salary so that you can retire with that money.?
• Or use it to buy a house.?

It basically helps you save so that you don’t really have to think about it. So what were the changes about??

The CPF contribution increases:

As Kelvin explains in my interview, with a higher monthly contribution to one’s CPF, one’s salary that they can take home will be less. Essentially, over the course of time and depending on your salary, you won’t have the same amount of cash you once used to have based on your salary because the CPF contributions will be increased.?

How should we cope??

It really depends on how much you earn and what your lifestyle is like but I’d like to put forth my own little acronym which can help in any situation; CPF contribution or not.?

It’s all about how you Save, Budget, Spend Or: S.B.S.?

• Ultimately, if you have money saved and you keep saving, you’ll weather any storm or any difference in your lifestyle. Also, you can approach the CPF contribution increases positively, as if the board is a friend who is helping you save more for the future.?

• Secondly, you must work within your budget. There’s no need to buy 2 items of the same product just in case one goes bad or gets damaged. Live within your means and write out how much money you can allow yourself to spend. Buying an extra ten pairs of shoes might hurt how much you can save. It may just be going overboard. And when the CPF contributions are increased you may not have enough money to do so, so adjust your expectations of what you should have and think about what you need. A simple way to do this is by dividing a page up by wants and needs with a line down the middle. Writing it down and seeing it in front of you may help you determine your budget for what’s really important in your life.?

• Lastly, the way you spend money should be deliberated also. I’ve spent money on friends in the past, and sometimes it’s been a little too much. I shouldn’t be trying to curry favour by buying someone a meal for example. It doesn’t matter how much it costs but the way you spend reflects your values and how well you can take care of yourself first and foremost. With inflation rising, GST rising, and our CPF contributions increasing, it’s important to put yourself first.?

Ultimately, you reap what you sow. And I’d like you all to be happy. That’s why I do these interviews, so you can all be more financially literate, know what to expect and S.B.S wisely.?

Here’s the full interview with Kelvin Koh:?

https://youtu.be/atlAiNIhzz8?si=pXP2nDsykpUiQpP3

If you’re interested in learning more about how you can plan for retirement, PYTCH Media has put together a 3 part series called “Finance Zen” on the CPF topic:?

• Part 1: Your Retirement Planning In Singapore Just Got A Whole Lot Easier!

https://youtu.be/EkT0bsx4xTQ?si=IJ4jsWvqweO1rduD

• Part 2: Are You Retirement-Ready? ??

https://youtu.be/V-HOTyKz-qg?si=-ubDFOpAvjVrPjHG

• Part 3: ???Safeguarding Your Retirement??

https://youtu.be/O-SCAnM_60Q?si=gUPqqrXgnBVBD_EQ