Life is…

Life is shit.

Which couldn’t be more true for Alvin right now, as he’s guarding a tower close to a cesspit that churns every hour or so and belches a stench that could only be 99% butane.

But I guess it can’t be, because his comrades can afford to light the hourly cigarette without blowing up the entire place. Butane is flammable, right?

So it’s probably ammonia. Every molecule of air within 10m radius of that sewer is permeated by ammonia.

But Alvin doesn’t live by the cesspool, and with any luck, the sewer won’t leave any permanent damage to his well-being when he finishes reservist. Yes, he’ll be coming back to real life, and guess what, continue to live in the churning pit of crap that is life itself. What better way to learn why, than to have a sobering one-on-one one-hour lesson with one’s insurance agent?

I met with mine on Monday. Let’s call him Casey for convenience’s sake. He had wanted to update me on a few developments, most significantly involving the Government’s decisions on our Central Provident Fund.

He said, from 1 April 2008 onwards, unless you have more than $20,000 inside your Ordinary Account, you won’t be allowed to use those savings on investment plans.

Of course, if you have $25,000, it means you can only use up to $5,000 on investments.

Bottom-line: Come 1 April 2008, anybody who wants to invest their CPF Ordinary Account money must have $20,000 as minimum retainer.

My curiousity was piqued. There has to be a reason why the Government is passing this new rule, right?

Yes, Casey said, because in case you need to buy a flat, $20,000 would definitely come in handy for part of the down payment.

Ahhh.

So, if I put my money in an investment plan, I can’t drag and drop it back inside the Ordinary Account and buy a flat, right?

Right.

There it was. The catch.

Casey explained, if I wanted to have my cake and eat it too, I could calculate how much I needed for flat-buying, leave it inside the Ordinary Account, then use the rest for investments.

Was I planning to get a flat soon? What sort of flat am I thinking about? We had no exact figures, but say I’m thinking of a flat that costs $300,000 – you need to put 15% as downpayment – which meant –$45,000 – which translated to –

$22,500 that my spouse and I would each have to fork out – which worked out to, for me –

44.47 months/3.7 years of work, not considering increments and bonuses.

Thinking about this gives me a bellyache. I’d only worked for about, what – a year at most?

Without looking at my CPF Statement of Account, we calculated that I was definitely in deficit. Of at least, um, I forget how we actually arrived at the figure: $10,000.

Although I was obviously unable to invest any Ordinary Account funds, Casey was unflappable. How about investing the money in the Special Account, then? And how about a sound financial plan to manage my salary?

I laughed. I couldn’t believe there was anything to manage at all, my salary being so meagre, as the astute reader would probably have guessed by now. (If you need help, 22% of our gross salary goes to CPF per month.)

We briefly evaluated my monthly expenses and I told him that I’d been out of work for half a year before I got employed recently, so the current breakdown was not accurate, having to catch up with loans and all. He said he understood and said we should probably give it three months, as a regular spending pattern should be apparent by then.

As for the Special Account, only 5% of one’s gross salary goes into it. If my Ordinary Account were in deficit, I shuddered to think of the dregs inside my Special Account. The minimum amount required for investment planning is $1,200.

Before we parted ways, I promised to check how much there actually was inside my CPF accounts, and let him know by the end of this week whether I had the gumption to invest my Special Account funds.

I learnt from Christopher Gardner in The Pursuit of Happyness that the American IRS has long hands that will reach into your bank account and deduct income tax owed to the government if you don’t file your taxes. In Singapore, likewise, the Central Provident Fund has insidious hands.

You think the moment you receive your first paycheck is a time to celebrate. You feel CPF’s firm handshake and mistake it as a congratulatory gesture, for in truth, it was really saying, “Welcome to the Circle of Life. Welcome to the Circle of Shit.”

After struggling to clear your tertiary education loan for about four years, you heave a sigh of relief, only to discover, to your chagrin, that you have to empty your CPF in order to buy a living space as attractive as a shoebox. Then you pay, pay and pay to repay the housing loan, and then you pay some more when –

When your own kid goes to university.

There must be something omniscient about CPF, for when I reached home, I received notice that, as at 31 Dec 2008, not only did I still owe more than $22,000 for my education loan, but also more than $500 worth of interest.

I need to take a shit. Maybe, if I could clear my system, I’d be able to decide whether or not to invest those funds.

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