The case of Madam Goh Kah Keow vindicated the merits of CPF Minimum Sum

‘I wish the banks had stopped me from withdrawing all my money!’ – lamented Madam Goh Kah Keow who lost $400,000 life savings to con artists from China.

I wish the banks had stopped me from withdrawing all my money. – See more at:

In my previous post on the merits of CPF Minimum Sum, one of my readers Fred Khoo pointed out that the CPF Minimum Sum (MS) scheme is a national failure and that the government should not “lock up” Singaporeans’ CPF monies. Well, one thing for sure is that most Singaporeans would have strong opinions on the CPF scheme but it does not mean that the CPF MS scheme is a flop. Indeed, there are flaws and improvements that can be made to enhance the policy to better suit Singaporeans’ needs. However, it should be noted that the merits of CPF MS far out-weigh the flaws. The recent case of Madam Goh vindicated my point.

As a cleaner, Madam Goh lives alone in a studio flat. After working for 60 long years, she managed to scrimp and saved more than $400,000 of life savings. This is an amazing achievement as apparently, she is uneducated and does not possess any skill. I reckon many wealth builders in Singapore are confounded by the amount of her nest egg. But unfortunately, she lost all of it in one day to 5 con artists from China. In my heart, I was wondering how heartless these PRC Chinese can be but that is beside the point here. Anyway, these con artists must have targeted her for quite some time before committing such a heinous act. They must have gathered a lot of information that she is cash rich and does not have social support, hence this made her an easy target for them.

Can this unfortunate event be avoided? Definitely. In one of my older posts, I have advocated that senior citizens should not hold too much cash on hand even if they are really cash rich. This is because the money would easily be squandered away. In the worse case scenario, having too much cash on hand could make you an easy target for criminals as well. In Madam Goh’s case, she should count herself very lucky that the con artistes did not murder her after taking her money.

Many Singaporeans argued that there should be more flexibility in the CPF MS scheme and that Singaporeans should be allowed to withdraw their monies at 55 years old. Many also criticized the relentless increasing amount for the MS and complained that it is a never-end game for them. What many Singaporeans fail to realize is that most of us are financially incompetent to manage our monies. When we received a wind-fall, we tend to spend it away instead of using the capital to generate more money for retirement. In Madam Goh’s case, if her monies are in her CPF account, this unfortunate incident would not have happened to her. Now, she has to start all over again and build up her nest egg at such an old age. I am not sure how many people can remain sane after going through her ordeal but she has earned my respect for being able to take it in her stride.

Three things you must take note if you have elderly seniors/parents staying alone:

1) Make sure they don’t hold too much cash. Otherwise, set up a joint account with them to ensure that they do not squander their life savings away. It is okay to have the occasional self-indulgence but encourage them to live simple as their earning abilities decrease substantially with advancing age. Advise them to refrain from revealing to others about their life savings and best not to lend money to others.

2) Nowadays, many Singaporeans choose to stay away from their parents, so it is important to frequently stay in touch with them to provide the family support. If your elders are illiterate and don’t read the news, then you should make the effort to highlight to them the recent criminal acts taking place in Singapore. This would increase their vigilance.

3) Most importantly, do not reveal personal information and your financial status to strangers. Many personal financial bloggers like to showcase their investment holdings in their blogs. But they don’t realize that their account could be hacked and sensitive information could be pieced together by cyber criminals to swindle away their monies.

What happened to Madam Goh was a classic swindle scheme. In today new age technology, your savings can also be wiped out from your bank account in one day if you are not careful in safeguarding your personal information. What happened to Madam Goh can also happen to you.

Magically yours

14 thoughts on “The case of Madam Goh Kah Keow vindicated the merits of CPF Minimum Sum

  • July 8, 2014 at 1:10 am

    Agreed. Never show off your wealth publicly and not even to your own relatives.

  • July 8, 2014 at 2:44 am

    I don’t see any relevant link between the swindle case of Madam Goh and CPF minimum sum. Her case has absolutely nothing to do with CPF minimum sum. How does her case vindicate the merits of CPF minimum sum. This is a sweeping statement as this kind of swindle scheme happens all the time regardless of one’s wealth or age. One case or a few cases for the matter, does not represent that this is going to be the norm for everyone if they are allowed to withdraw their CPF savings. By the way, this is also not a windfall but one’s life savings!

  • July 8, 2014 at 2:53 am

    I also agreed… showing off is like asking for trouble 😉

  • July 8, 2014 at 5:28 am

    It never fails to surprise me how perfectly logical people can be silly enough to use extreme cases to justify a general rule. But then again, they are merely following the example set by the government.

  • July 8, 2014 at 7:56 am

    I agree. Being swindled has nothing to do with the minimum sum scheme. In any case, I don’t think the MS scheme was made to prevent old folks from being swindled. It may have been added as an after thought argument, but never the main reason.

    For one Mdm Goh, how many have to suffer because their CPF monies are locked away by the govt.? So are we saying that we need the govt to protect us from swindlers, from over-indulgence, from whatever we do wrong?

    If we agree that the MS scheme has its flaws, can we also agree that other methods may be used instead just locking up the money? This govt has a bad habit of going for the easy way out. We have scholars, million $$$ minister, etc to figure out better ways instead of creating schemes which mainly benefits the govt.

  • July 8, 2014 at 9:12 am

    Her gulliblity is not representative of intelligent Singaporeans. It is the failure of education thru msm, the reckless influx of talents (con artist included). You should not lock the eggs from the chicken and ignore the willy fox which has been let in by the millions.

  • July 8, 2014 at 11:16 am

    minimum sum – no trust in people’s good judgement. no trust – no growth in judgement in handling one’s own money. no growth in judgement – easy to kena cheated, also money locked up thus greedy for more cash and thus easier to kena cheated.

  • July 8, 2014 at 10:31 pm

    You missed the point. The point is I am trying to highlight that most Singaporeans are not good at managing money. Would you lend $400,000 to a stranger? How about the Minibond case? Geneve Gold? All these minority cases? Time you read up on the news guys!

    SG Wealth Builder

  • July 8, 2014 at 10:32 pm

    Yeah, Mr Know-it-all. Good at criticizing but offer no substance.

  • July 8, 2014 at 11:35 pm

    Many non-serious retail investors or ordinary folks in the HDB heartland are off better in receiving monthly payouts instead of lump sum.

    Lump sum may attract evil eyes and evil hands and soon the lump sum may disappear fast.

  • July 9, 2014 at 3:30 am

    So in MyPaper today, someone suggested the need for financial literacy. He cited the $1m Widow (Mdm Pusparani, but most people know her as the “Silly $1m Widow”).

    And while Freddy has a point that being swindled is… actually no. He doesn’t have a point.

    What is the difference between being swindled by 5 PRCs, and losing money in your relative’s business (like what Mdm P did)?

    Intent. One has criminal intent. The other was genuinely trying to run a business (assumption).

    However the net result is the same – no money.

    The minimum sum was in part set up because of the increasing number of “5562” cases. Men 55 to 62 who are prime targets for PRC “gold-diggers” – who marry them for their money.

    To be fair, it was not just PRC women.

    And to be fair, the men did get some “consideration” out of it. Might be cheaper to go to Geylang tho…

  • July 9, 2014 at 5:25 am

    There is really a lack of financial literacy. Where does our young ones gain such knowledge at all?

  • July 9, 2014 at 6:02 am

    The CPF returns are too low, forcing people to over invest into properties because properties are well known to hedge well against inflation provided you don’t buy into a bubble. If the government wants some sanity on the housing market, make sure to increase the returns in OA or rather the entire CPF

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