We invest so we can overcome year on year inflation! Right?
But ....
Which is more scary???
Inflation or losses if you are not that good in investing over market cycles.
Which one kills your money faster?
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People tend to fight the last wars. If you read books / articles published in the 1990s or early 2000s, you'll see many talking about inflation. Now with 20 years of low inflation (and a couple of years of deflation in-between), nobody is talking about it. LOL.
ReplyDeleteThen again this is headline inflation or general inflation.
For retirees, the concern will be mainly inflation in healthcare, food & utilities. These 3 categories tend to be higher than the general inflation.
Healthcare is probably the No. 1 concern for sinkies going forward. This is mitigated by H&S insurance. But a lot of para-healthcare & incidentals are not covered under Shield plans.
Plus with bills to insurers going up, they will merely jack up integrated Shield premiums every couple of years to keep pace. Definitely higher then MA's 4% interest! LOL!
CPF-administered Medishield Life will try to keep the increase same as 4%, until the underlying insurer(s) tak boleh tahan. If you noticed, over the past 10 years they have always used "revamp" of the benefits to justify premium increases. Goes down easier with the electorate .... behavioural econs at work! :)
Singapore 2018 healthcare inflation @ 10%
"Buffet" attitude of both consumers & doctors for those on private class Shield plans don't help.
1) Spur,
ReplyDeleteYou no fun one.
Pour cold waters on those who think with CPF MA at 4%, their shield premiums will be "free"!?
2) CW,
Show your real life household crash got sound infaltion figures to those who are voluntarily contributing to CPF in their 20s ;)
LOL!
Apple pie increased from $1 to $1.20.
Fishball noodle from $3 to $3.50.
Without big daddy's pioneer and medeka subsidies, you think CPF at 4% can beat the health care inflation?
I'll bet most of us in the community are not thinking about pioneer or medeka subsidies... If yes, how are we any different from those who are not financially literate or don't plan their retirements at all?
Eh...
MIW is supporting Pioneer and Merdeka generation through good medical subsidy.
DeleteMedicine to treat "rich" man illness not subsided?
DeleteSubsequent vitamins prescription are not covered under company provided medical benefits. Right?
DeleteTemperament,
DeleteVit B1, B2, B3, B6 are subsidised. But not B12 which is 1 of the 3 B vit in Daneuron/Neurobion (B1, B6, B12).
Just eat more meat & eggs, hoho.
But I've seen some welfare patients get subsidised Neurobion though. Probably those qualify for Medifund.
@SMOL,
ReplyDeleteIf basic Medishield Life, then good chance will be "free" as they'll try their best to keep premium inflation to 4%. :)
@Uncle8888,
The "generation packages" is very good for medical, but unsustainable if implemented beyond Merdeka. We'll end up like many western countries with low birth rates (still higher than Singapore somemore!!) where govt healthcare spending goes up exponentially each year. Revenue will need to come from somewhere e.g. more amendments & usage of Reserves, more taxes, 15% GST, capital gains tax, dividends tax?
@All,
MOH publishes its list of subsidised drugs at https://www.moh.gov.sg/cost-financing/healthcare-schemes-subsidies/drug-subsidies-schemes.
They use generic / chemical names, not brand or marketed product names ... so unless you're taking (or helping to administer) those drugs or working in healthcare, you may not recognise most of them.
On that web page, you can go 1 level up to see ALL the various national healthcare schemes & subsidies.
Do you believe till around 2016 that pen-filled insulin wasn't subsidised?!? Only the old-fashioned insulin in vials & syringes/needles were subsidised. My relative used to spend a couple hundred bucks from his Medisave every 3 months to get pen-fill cartridges resupply from Poly. Now he pays just 10s of dollars.
Current generation is thinking of FIRE in their 30s, 40s or 50s. They can take care themselves, no need much help from govt. Perhaps govt should upgrade RA further to LRS and SLRS ie large and super large
DeleteIf 80% of 30-50 can be FIREers, think the govt no headache liao! LOL!!
ReplyDeleteBut prob 80% of GenX & millennials will be similar to merdeka generation.
As for making CPF a real retirement scheme for the masses, no need to mess around with RA or even have RA .... easy lorr .... just remove the ability to use it for property or tertiary education. Hohoho!
Spur,
DeleteThat's the effect of "unintended consequences"...
When everyone and anyone can afford tertiary education, housing, and medical expenses, of course it won't take long before snake oils start encouraging, "You deserve it! Just upgrade lah! If not your CPF money just rots there..."
All service providers start to take a page from car repair workshops.
But then again, without (controlled) inflation, how do landowners make more money?
And how do businesses and big daddy pay down debts with inflated dollars?
Savers?
They are kept around for the wool, milk, or meat.