In the first part of this article, we shared with you that Singaporeans pay the highest proportionate contribution into social security (which is our CPF) in the world – the 36% we pay is the highest in the world. Singaporeans are also one of the only 12 countries, or 7% out of 166 territories, where employees pay more than employers into social security. (You can read Part 1 of this article here.)
However, even though Singaporeans contribute the most into our CPF, and accumulate the largest CPF assets, we have the one of the least adequate retirement funds in the world. But why is this so?
This is because we are paid very low returns on our CPF. We are paid only 2.5% on the Ordinary Account and 4% on the Special and Retirement Accounts (Chart 1).
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