Singapore's love affair with property, coupled with soaring property prices, has helped make our debt levels rise to 75 per cent of gross domestic product ("S'pore debt levels 'among highest in Asia'"; last Wednesday).
In view of this high debt level, the Government has stepped in to regulate. The Monetary Authority of Singapore has set guidelines for banks to cap the total debt service ratio at 60 per cent of gross monthly income.
However, how much of these property-related debts are financed by the buyer's Central Provident Fund (CPF) account?
Besides property instalments, many also use their CPF funds to invest in equities and unit trust funds. Is the mandatory monthly CPF contribution fuelling our debt levels?
The CPF was set up with the fundamental purpose of meeting retirement needs. It was not meant for speculative purposes.
We need to exercise prudence with our retirement funds. With increasing health-care costs and inflation, we will need more than we can now imagine.