Annuity plan

[boredboiboi]

Annuity plan quote quote

I guess i should open this thread to quote for anyone that is looking for private annuity plan. If not suitable, will close this thread.

 

[mummynew]

I guess i should open this thread to quote for anyone that is looking for private annuity plan. If not suitable, will close this thread.

I have a friend who is single, 55 yo, owns two fully paid condos. She is planning for her retirement and I am thinking of getting her to liquidate one of her properties (currently rented out) and get an annuity.

To start with a single pay premium of $1 million, what are the products available in the market now?

She has no one to leave her assets to and so ideally should just spend most of her monies away imo.

*her CPF is all full.

 

[boredboiboi]

I have a friend who is single, 55 yo, owes two fully paid condos. She is planning for her retirement and I am thinking of getting her to liquidate one of her properties (currently rented out) and get an annuity.

To start with a single pay premium of $1 million, what are the products available in the market now?

She has no one to leave her assets to and so ideally should just spend most of her monies away imo.

*her CPF is all full.

Example from company M

If payout start age 60 for 20 years
Min guaranteed monthly income $4900 excluding bonus
Single Premium $1008934.50

If payout start age 65 or 20 years
Min guaranteed monthly income $5950 excluding bonus
Single Premium $1007882.40

 

[mummynew]

Example from company M

If payout start age 60 for 20 years
Min guaranteed monthly income $4900 excluding bonus
Single Premium $1008934.50

If payout start age 65 or 20 years
Min guaranteed monthly income $5950 excluding bonus
Single Premium $1007882.40

Can you show the non guaranteed amounts for both plans as well pls?

 

[boredboiboi]

Can you show the non guaranteed amounts for both plans as well pls?

Example from company M

If payout start age 60 for 20 years
Min guaranteed monthly income $4900 excluding bonus
@3.25% monthly income is $5179.84
@4.75% monthly income is $6467.75
Single Premium $1008934.50

If payout start age 65 or 20 years
Min guaranteed monthly income $5950 excluding bonus
@3.25% monthly income is $6346.82
@4.75% monthly income is $8263.01
Single Premium $1007882.40

 

[Geeezz]

I have a friend who is single, 55 yo, owns two fully paid condos. She is planning for her retirement and I am thinking of getting her to liquidate one of her properties (currently rented out) and get an annuity.

To start with a single pay premium of $1 million, what are the products available in the market now?

She has no one to leave her assets to and so ideally should just spend most of her monies away imo.

*her CPF is all full.

i actually want to sound offensive here.

WHAT A BAD ADVISE are you seriously going to tell your FRIEND that?

asking her to liquidate an asset that can generate income and in Singapore context, a potential growth in capital? who on earth will sell away sth like that?

spend most of her money away? how are you going to calculate that? can you predict how long she will live?

let's say we divide her payout evenly till age 85 fr her to spend MOST of her money away. what if she live past 85? are you going to help sustain her lifestyle? if in between she needed a huge sum of cash for illness etc, you are paying for her?

annuity is a plan that provides monthly income for a LIMITED year and MAYBE a lumpsum at the end of the term.

but property rental provides a potentially LIMITLESS years of monthly rental income and potentially worth even more in future.

so if u wn to replace her property, do replace it with sth that can provide monthly passive income and at least a protection of the CAPITAL. why? because she is single and the "second" property is meant for huge expenses.

imo ppl in such situation do not need any other financial products frm insurance companies. top up cpf to ers asap to get a higher payout, go fr escalating to combat against inflation. with her rental income n ers payout she will hv more than enough fr her expenses. pls tell me that this is just trolling

 

[mummynew]

i actually want to sound offensive here.

She has two properties that she had made enough from both. If she doesn't liquidate in time, she may die without enjoying the proceeds that can be realised from both properties. Tying most of her assets in these properties is not so wise in case there is a crash within these 10 years or so (both crash at the same time then how?).

My thinking is to liquidate one first. If she lives beyond those 20 years of the annuity payouts, then she may do a reverse mortgage on the second property.

Her CPF is max.

This is not trolling.

*You should be relatively young that you may not understand the considerations of aging people, that we are thinking more about coming disability, about dementia, etc, that we are not so keen to build money higher and higher anymore but more looking at stability and consistency of income with the least fuss.

 

[Belle69]

Annuity is : you give the bank your money, they keep it for 3 years then give you back you money plus 4% in installment for 25 years.

Stupid.

 

[BBCWatcher]

Annuity is : you give the bank your money, they keep it for 3 years then give you back you money plus 4% in installment for 25 years.

Stupid.

Yes, that type of annuity is stupid — I’m forced to agree. We should be discussing and quoting guaranteed escalating life annuities in this and in so many other cases. Otherwise this poor woman is pre-programmed to suffer an ever declining standard of living as the real purchasing power of her income stream fades with inflation, followed by a sharp and sudden crash in her standard of living when her private annuity runs out and she has to get by on CPF LIFE.

Escalating, life, and the guaranteed portion, please!

 

[mummynew]

Annuity is : you give the bank your money, they keep it for 3 years then give you back you money plus 4% in installment for 25 years.

Stupid.

The real stupid people perhaps are those who fail to see that different people will have different financial needs and so will require different financial plans.

Those reverse mortgage plans are worst in returns in my mind but they are good for those older ones, like my single friend, to just spend their assets away while still alive.

 

[mummynew]

Escalating, life, and the guaranteed portion, please!

Have to compare plans with insurers surely will balance their own interests.

With escalating, life, and guaranteed portion, this will mean a lower monthly payout and so this has to be weighed against one with a higher monthly payout.

I am the trustee of this single friend. I ever wondered if she really goes into disability one day and I have to execute the trust, what I would do for her assets to let her live comfortably in a nursing home for the rest of her life. With total asset of about $5 mil, annuity plans should solve the issues smoothly (since I am also getting old and so would not want to go into something more complex any further).


*I am reluctant to be her trustee and advised her to engage the services of a trust company. She made enquiries and said very expensive and rather trust me than to trust a trust company. I do have several friends like this, single, rich, around mid/late 50s, and not many whom they can trust around them. This group of people has their own anxiety about how to best deplete their assets before they are gone.

 

[mummynew]

Example from company M

If payout start age 60 for 20 years
Min guaranteed monthly income $4900 excluding bonus
@3.25% monthly income is $5179.84
@4.75% monthly income is $6467.75
Single Premium $1008934.50

If payout start age 65 or 20 years
Min guaranteed monthly income $5950 excluding bonus
@3.25% monthly income is $6346.82
@4.75% monthly income is $8263.01
Single Premium $1007882.40

Many thanks for your quotes.

Let me try to figure out how they stand against my current TM 3G annuity plans (that off hands seems more attractive than the above that I have to work it out as off hands can really be off).

Meanwhile, do you have any stats of those who have started drawing their monthly income, whether Co M is paying at 3.25% or 4.75%? So far, my TM has been honouring the 4.75% that I have been enjoying my $5000 monthly payout comfortably.

 

[boredboiboi]

Many thanks for your quotes.

Let me try to figure out how they stand against my current TM 3G annuity plans (that off hands seems more attractive than the above that I have to work it out as off hands can really be off).

Meanwhile, do you have any stats of those who have started drawing their monthly income, whether Co M is paying at 3.25% or 4.75%? So far, my TM has been honouring the 4.75% that I have been enjoying my $5000 monthly payout comfortably.

You are welcome. I dont have any stats as retirement plan from company M is relatively new. I can generate from company TM to see see the premium. But to be honest, we do not know if future both can honour 4.75%but i have not seen any lower than 3.25%.
Company tm single premium earliest payout is age 70
But another 1 with yearly income guaranteed $59400 start age 65 and premium pay 5 year is $183528.20, @4.75% is $61479. Dont have payout start 60

If base on same $5950/month but tm is yearly $71400
Premium is $220604.60/year for 5 years ($1103023 total)
@4.75% $73899

 

[BBCWatcher]

With escalating, life, and guaranteed portion, this will mean a lower monthly payout and so this has to be weighed against one with a higher monthly payout.

Lower nominal monthly payout to start, yes — so her real lifestyle doesn’t diminish for 20 years then come crashing down to CPF LIFE level! Most people I know want an enjoyable life, with at least relatively stable real spending power to buy the goods and services they need to live and to enjoy life, without any worries.

With total asset of about $5 mil, annuity plans should solve the issues smoothly (since I am also getting old and so would not want to go into something more complex any further).

Yes, a guaranteed escalating life annuity is the highest, best role for an annuity provider. That’s the area where a high quality life insurer can add real value in exchange for the considerable implicit cost. Then she’s set for life insofar as possible, her real life.

Doesn’t anybody understand what money is for? It’s not a score on a scoreboard! You shouldn’t go look at the initial nominal monthly payment amount and call it a day. Otherwise, instead of a 20 year payout, why not 10? Or 5? Or one month? Come on, let’s deal in reality here, OK? If the scenario is to make sure her possible high quality nursing home care is secured for life, a cost that increases in nominal terms — the price of nursing home care increases at least as fast as general inflation — then work to solve that problem. Don’t work for the insurance agent who’s just trying to sell anything as much and as often as possible to make sales commissions and quotas.

 

[mummynew]

Lower nominal monthly payout to start, yes — so her real lifestyle doesn’t diminish for 20 years then come crashing down to CPF LIFE level! Most people I know want an enjoyable life, with at least relatively stable real spending power to buy the goods and services they need to live and to enjoy life, without any worries.

Yes, a guaranteed escalating life annuity is the highest, best role for an annuity provider. That’s the area where a high quality life insurer can add real value in exchange for the considerable implicit cost. Then she’s set for life insofar as possible, her real life.

Doesn’t anybody understand what money is for? It’s not a score on a scoreboard! You shouldn’t go look at the initial nominal monthly payment amount and call it a day. Otherwise, instead of a 20 year payout, why not 10? Or 5? Or one month? Come on, let’s deal in reality here, OK? If the scenario is to make sure her possible high quality nursing home care is secured for life, a cost that increases in nominal terms — the price of nursing home care increases at least as fast as general inflation — then work to solve that problem. Don’t work for the insurance agent who’s just trying to sell anything as much and as often as possible to make sales commissions and quotas.

She has about $5 million asset. The value of this one condo is less than 50% of her total asset, meaning her real lifestyle will not diminish after 20 years as she has other assets to liquidate to sustain her for life.

I tend to believe that insurers are smart with actuarial science behind them. If one wants leveled amount, one will get higher monthly $A overall total $X, and if one want escalating amount, one will get lower $B but overall still total $X. Ideally is to be able to have the whole cake and eat it.

I am perhaps the odd ones who hold respect for financial planners and have never minded about paying commissions to them if they can recommend good products. They are useful for many people who can't plan their money well (some 'clever' people end up worst than if they have used a financial planner when at their old ages, they realise they are actually not as clever as what they thought. Strict discipline is just such a difficult thing to adhere to for many.).

 

[celtosaxon]

One exception — at least to the extent spending down outside sources earlier allows her to delay CPF LIFE to 70 (which will create a larger annuity stream that is more valuable than she can get privately).

Lower nominal monthly payout to start, yes — so her real lifestyle doesn’t diminish for 20 years then come crashing down to CPF LIFE level! Most people I know want an enjoyable life, with at least relatively stable real spending power to buy the goods and services they need to live and to enjoy life, without any worries.


Yes, a guaranteed escalating life annuity is the highest, best role for an annuity provider. That’s the area where a high quality life insurer can add real value in exchange for the considerable implicit cost. Then she’s set for life insofar as possible, her real life.

Doesn’t anybody understand what money is for? It’s not a score on a scoreboard! You shouldn’t go look at the initial nominal monthly payment amount and call it a day. Otherwise, instead of a 20 year payout, why not 10? Or 5? Or one month? Come on, let’s deal in reality here, OK? If the scenario is to make sure her possible high quality nursing home care is secured for life, a cost that increases in nominal terms — the price of nursing home care increases at least as fast as general inflation — then work to solve that problem. Don’t work for the insurance agent who’s just trying to sell anything as much and as often as possible to make sales commissions and quotas.

 

[binbinpon]

Lots of money mind posters are insurance agents masquerading as real financial advisors.... Lol

 

[maple96]

One exception — at least to the extent spending down outside sources earlier allows her to delay CPF LIFE to 70 (which will create a larger annuity stream that is more valuable than she can get privately).

spot on! Only just one more consideration or assumption removed.

 

[maple96]

She has about $5 million asset. The value of this one condo is less than 50% of her total asset, meaning her real lifestyle will not diminish after 20 years as she has other assets to liquidate to sustain her for life.

I tend to believe that insurers are smart with actuarial science behind them. If one wants leveled amount, one will get higher monthly $A overall total $X, and if one want escalating amount, one will get lower $B but overall still total $X. Ideally is to be able to have the whole cake and eat it.

I am perhaps the odd ones who hold respect for financial planners and have never minded about paying commissions to them if they can recommend good products. They are useful for many people who can't plan their money well (some 'clever' people end up worst than if they have used a financial planner when at their old ages, they realise they are actually not as clever as what they thought. Strict discipline is just such a difficult thing to adhere to for many.).

I am with u. Those very wealthy should seek the help of expert financial planners/advisors on how to better manage their wealth for retirement, etc.

Dun come here where there is potential conflict of interests, differences in cultural, financial, age, etc backgrounds and hidden assumptions made. At least with that in mind. I always believe nobody in the world will teach u all the secrets to making money, without any hidden objective/motive.

Do your own due diligence. I believe mummynew is doing very well with some expert financial advise and those should be able to be applied to her wealthy friends.

I dun mind paying, eg. I bought whole life insurance when young, now it is compounding at 4-5% pa , I dun need the insurance component anymore, so continuing with it as an "investment". No cost, only upside, no downside.

Now there are so many people willing to pay a fee, not for whole life policies, but for robo portfolios. Cost plus potential downside should market dive

 

[hwmook]

Have to compare plans with insurers surely will balance their own interests.

With escalating, life, and guaranteed portion, this will mean a lower monthly payout and so this has to be weighed against one with a higher monthly payout.

I am the trustee of this single friend. I ever wondered if she really goes into disability one day and I have to execute the trust, what I would do for her assets to let her live comfortably in a nursing home for the rest of her life. With total asset of about $5 mil, annuity plans should solve the issues smoothly (since I am also getting old and so would not want to go into something more complex any further).


*I am reluctant to be her trustee and advised her to engage the services of a trust company. She made enquiries and said very expensive and rather trust me than to trust a trust company. I do have several friends like this, single, rich, around mid/late 50s, and not many whom they can trust around them. This group of people has their own anxiety about how to best deplete their assets before they are gone.

You are right. Stupid people only think about earning more money without thinking of how to use the money to make their life better even when they are dying.