Four CPF Life Options

Here are the details of the four CPF Life Plans, with input from the chief executive of Eternal Financial Advisory.

Mon, May 03, 2010
The Straits Times

Here are the details of the four CPF Life Plans, with input from Ms Viviena Chin, chief executive of Eternal Financial Advisory.

Life Basic Plan: Gives lower payouts but leaves more to beneficiaries. Suitable for those with sufficient retirement income and wish to leave behind income for their loved ones.

Life Balanced Plan: Strikes a balance between monthly payouts and the bequest. This is the default plan for those who will automatically be included in the scheme from 2013. Suitable for retirees who have additional sources of retirement income.

Life Plus Plan: Gives higher payouts and leaves less for beneficiaries. The plan will appeal to individuals with conditions such as chronic medical conditions who require higher payouts to cope with the cost of living and yet still wish to leave something behind. This plan has been the most popular so far.

Life Income Plan: Offers the highest payout with no bequest feature. Any amount left in the retirement account will go to the CPF Life monies pool, to be shared with the existing members under the scheme. Likely to be suitable for those with no beneficiaries and those who have no other sources of retirement income.

Plan way in advance

'The intent of annuity plans like CPF Life, which is compulsory, is to ensure that Singaporeans do not outlive their savings. With increased longevity, annuity plans are one of the best ways to hedge against this risk. We have to start thinking about financial planning for retirement even before we hit our 50s. It's a lifelong process of stock-taking. Plan wisely and you should be able to live comfortably through your golden years. You've earned it.'

MS DEBORAH HO, chief executive, DBS Asset Management

Live the life you want

'The sooner one starts the process of financial planning, the better one's ability is to secure his future and free up financial resources to enjoy a sustainable lifestyle.'

MR SHRIKANT BHAT, head of wealth management, Citibank Singapore

Leave behind a legacy

'For a comfortable retirement, Singaporeans need to save more than their CPF and they need to invest with the right asset allocation to grow their assets after allowing for the effects of inflation.

So save more and invest cleverly, with the help of a qualified financial planner. In addition, for peace of mind, estate planning is important to look after the future of the next generation.'

MS ANNETTE KING, chief executive, Manulife Singapore