Monday, October 19, 2009

Close to 12,000 opt for CPF Life

Source: Straits Times Oct 18, 2009
Close to 12,000 opt for CPF Life

By Jamie Ee Wen Wei

It has been a busy month at the Central Provident Fund (CPF) Board.

Members have been flooding its offices and phone lines with questions about the new CPF Lifelong Income Scheme For The Elderly (CPF Life), which was opened last month to those aged 55 and above.

Almost 30,000 people have walked into its five service centres to ask about the scheme, said Mr Tey Chee Keong, deputy director of CPF Board's lifelong income department.

Payout of $360 a month on retiring

In two years' time, when she turns 62, Madam Yeo Ai Kiaw (above) will get a payout of about $360 a month from her CPF Life Basic plan.

The plan, which has the lowest payout among the four options, will allow her to leave more money to her beneficiaries when she dies.

'My husband and I are now living with our son. He and his wife take care of all the household bills. I don't have to worry about anything,' said the sprightly 60-year-old.

Preparing himself for a longer life

Mr Palaniappan Kannappa is not afraid of death but he is worried about 'living too long'.

'The Minimum Sum in my CPF will dry up in about 20 years. What will happen if I live longer than that?' he said. So the 59-year-old accountant started shopping for a retirement policy a year ago.

Around that time, he read about the CPF Life plan, which was introduced to the public last year.

Mr Cheng Yew Fatt wants to remain independent in his old age

Mr Cheng Yew Fatt wants to remain independent in his old age.

For this reason, the 55-year-old, who is unemployed, signed up for the CPF Life Plus plan last month.

It provides him with a higher monthly payout than the Life Balanced plan, but leaves less for his beneficiaries. It suits him because he feels his three children are already well protected financially.

His savings will run out in 5 years

Mr Lee Poh Lee is a family man, but last month, he signed up for the CPF Life Income Plan, which will give him the maximum payout from his CPF from next year.

The 63-year-old, who runs a crane rental company, decided on this plan because his CPF savings are low.

'I've only about $19,000 in my CPF so it'll run out very fast.'

He's not signing up

When Mr Christopher Seet turned 55, he invested $70,000 from his CPF in an American International Assurance (AIA) annuity plan.

Early this year, he started getting a monthly payout of $562.

Now 62, Mr Seet does not intend to sign up for CPF Life. He said it does not bother him that the monthly payout he is getting now will last for only 17 years, unlike the CPF annuity scheme, which is for a lifetime. 'What is important is the present. If I really outlive my savings, then I'll just have to find some way to make ends meet.'


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