Sunday, 10 September 2017

Mid-life Challenge: Job Market is Bad. Chuan Jin Accepts Pay Cut.



    Tan Chuan Jin’s problem is an ordinary Singaporean problem. Job market is bad but as a mid-career, mid-life (PMET) person, he has many personal and family commitments. This is not a political price issue but a bread and butter problem. So, he has to accept a pay cut and re-deployment.

What are the mid-life challenges?
  • Housing loans, may be for second home.
  • Car loans, perhaps a second car.
  • Education fees for children.
  • Parents maintenance expenses.
  • Insurance - life, endowment, investment-linked products, medical etc.
  • Medical expenses (he was once ill)
  • Entertainment and holiday for family.   

    When a PMET is retrenched or redeployed, he will need to adjust his lifestyle and try very hard to maintain his quality of life as before. This is especially when one faces a pay cut.

    Being a former Manpower Minister, Chuan Jin knows too well that ‘CPF money is not your money’. Between age 48 to 55, Chuan Jin cannot withdraw CPF saving for own use even though he has a handsome balance with CPF Board. Only after 55, he can withdraw CPF saving above the required minimum sum.  He also cannot withdraw Medisave as he wishes because there is a limit. This means there is a need of cash top up.

    Luckily for Chuan Jin, his pay cut does not affect his financial commitments so much. He can still afford to have holidays, allowances for children and parents, serving housing and car loans, and paying insurance premiums promptly. His medical is still covered by the government.

    So, his political price or compromise is well taken cared of.

    However, if you are a PMET earning more than $100,000, a pay cut of 50% or same scale as Chuan Jin, you will face a real challenge. Most likely, you will have less entertainment and holidays, giving less allowances to your children and parents, perhaps some problems paying insurance premiums, housing and car loans.

    Now, you can understand why Chuan Jin accepts a deployment and pay cut. You may still recall Lui Tuck Yew, from a minister to our current ambassador to Japan.  Certainly, the pay for ambassador is lower than a Speaker of the House. Luckily, Tuck Yew is above 55, he can withdraw CPF money to meet his personal financial commitments.

    Chuan Jin or Tuck Yew, both scholars, in fact can be better deployed to GLCs like SMRT, Keppel, Singtel, Capitaland, etc to earn million dollars. Why not?

Unfortunately, both may have choose the wrong path. This is their political price. They are not the political materials that Lee Hsien Loong wants.

No matter what, Chuan Jin and Tuck Yew are still drawing handsome salary on tax payers’ money. This is very different from most of the PMETs who have to face the real challenges in life and in career.

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