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When to get a private annuity?

Thursday, September 14, 2017

Reader:
Been reading your blog for a while now and wanted to ask you what do you think of XXXXXXXXXXX as a retirement plan.

My financial consultant suggested this (product) to me recently but I wanted to get a second opinion on this.

Could you talk to yourself about this please?








AK:
As a retirement plan, there is nothing out there that can beat the returns offered by CPF Life.

Unless I have maxed out my CPF account, I would not consider putting money in a private plan.

http://singaporeanstocksinvestor.blogspot.sg/2015/02/an-annuity-would-you-rather-have-it-or.html




I have done a case study of a private plan before and how it could not beat CPF Life. 

You might want to use this as reference when looking at the product offered to you:

http://singaporeanstocksinvestor.blogspot.sg/2014/07/an-annuity-proposal-case-study.html




In summary, max out your CPF account first (i.e. top up your CPF-SA to hit prevailing FRS) or if you are above 55, think about maxing out your CPF-RA.

Only then, think of possibly getting a private plan to supplement CPF Life.

Related posts:
1. 4 ways to beef up CPF savings.

2. CPF savings 10 years from now.

10 comments:

Laurence said...

As AK always says: "Nobody cares more about our money than we do. Don't ask barbers if we need a haircut."

AK, think you need to put this famous couplet in extra big bold fonts on top of your blog heading. Lol.

AK71 said...

Hi Laurence,

Couplet? Maybe for Chinese New Year. ;p

Laurence said...

Just saw an annuity plan elaborated in the Dollars And Sense website. Look at the humongous returns:

http://dollarsandsense.sg/retirement-planning-beyond-cpf-life-ways-supplement-monthly-income/

https://www.ocbc.com/personal-banking/insurance/maxretireincome.html?pid=sg:en:others:insurance:MaxRetireIncome:Evergreen:42826:vanity::::::

AK71 said...

Hi Laurence,

That is probably an advertisement for OCBC.

Some blogs are actually sponsored but not all of them will state the fact clearly.

We have to be careful and watch out.

No one cares more about our money than we do. ;)

AK71 said...

Prasad Rnv says...
I am all for annuities but this must be pro choice and not foisted upon you.

AK says...
Since you believe in annuities, then, the CPF Life is the best product available.

As for making CPF Life compulsory, most people wouldn't buy an annuity, otherwise.

To me, making CPF Life compulsory is better than making supporting Singaporeans who run out of retirement savings compulsory (i.e. welfarism). :p

AK71 said...

Prasad Rnv says...
(CPF LIFE) is the best agreed. But I want a choice in subscribing to it and not let the government forcibly decide on my behalf. This is my gripe.


AK says...
If someone makes it compulsory for me take up something that is the best option (i.e. CPF LIFE) available, why should I be unhappy and have a gripe? :p


Prasad Rnv says...
Just understand that all dont think like you. We will agree to disagree here.


AK says...
I understand that perfectly. Otherwise, we wouldn't have "Return our CPF" rallies in Hong Lim Park. :p

AK71 said...

Tony Shue says...
I would argue that given a choice (where CPF Life is compulsory), having an annuity for retirement is a matter of personal preferences. Because annuities does lock up that portion of your retirement fund. I think a lot of sinkies are "complaining" about that. Again, "all other things being equal", etc.



AK says...
Certain things have to be made compulsory because we cannot expect everyone to do what is right and responsible.

As long as we are compensated with having the best product there is (i.e. CPF LIFE), I don't have a problem.

If CPF LIFE was an inferior annuity compared to other annuities available, then, I would protest in the loudest voice possible! ;)

AK71 said...

Reuben Sreetharan says...
Assi your head lah. Too many posts from you.
Think you are the solution too everyone who has financial problems isit? Who the hell do you think you are conning! And stop acting cute. I vomited a few times already
And all your shit head followers. I dont give a freaking sh!$ what you have to say. Go find a rope and hang yourself!

Jack James says...
Help yourself , stop following Assi AK post . Simple .

Kok Koon says...
Jack James - chill bro. Do some screenshots and keep.

Jack James says...
Kok Koon , I am cool , until frozen liao. Haha .

AK says...
I am so sorry to have caused Reuben Sreetharan so much angst. :(
Since following my blog upsets him, I will do him a big favor by blocking him. It is done.
Don't worry. Be happy. :D

AK71 said...

Allan Matt says...
Cpf is not the best product . People can decide what they want

Jack James says...
When one cannot argue or reason over a case , one will always just say .... we will agree to disagree . LOL .
As for me , I will always tell people , if you can’t fight it , join it . Play with the rules.

Winston Wee says...
The simple fact is government policies like laws are for all, and not tailor-made to suit each individual. CPF is good for a majority of Sporeans, but there will be some who think they can put their money to better use elsewhere. If one day if the government ever decides to let Sporean to out their anytime they want, some will end up having no money for retirement, then they will blame the government for allowing them to take out their CPF money.

Dolce Goh says...
CPF Life is the best annuity available in Singapore!

AK71 said...

Winston Wee says...
Despite of AK's sustained efforts to educate about the merits of CPF, there will always be some who want to take their money out.

There is a saying if you take all the money in the world and share equally among all the people in the world, within 10 years, those who were rich, will become rich again, those who were poor, will become poor again.

Money likes to congregate around those who can take good care of it.

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