About CPF life premium

[homedriver]

According to CPF website about the CPF life premium
“Your monthly payouts will first be paid from your CPF LIFE premiums. When your CPF LIFE premium is depleted, you will continue to receive the monthly payouts from the pooled interest that has been accumulated, no matter how long you live.”

My doubt is:
The CPF LIFE premium is the amount I deposit when purchase the CPF LIFE policy at 55 or is the amount plus interest accumulated at 65?

For example:
55 - deposit 200k
65 - with interest, 200k is become 300k

If I start receiving 1k per month after 65 for 10 years and pass away. My beneficiaries will receive the remaining 180k (*300k - 120k)?

In summary, I’m still benefit for the interest between 55 to 65. But interest earn after 65 is go to the common pools to share across the cpf members.

 

[rizhal]

My doubt is:
The CPF LIFE premium is the amount I deposit when purchase the CPF LIFE policy at 55 or is the amount plus interest accumulated at 65?

Yes, your CPF life premium is the amount + interest accumulated at 65.

 

[fr33d0m]

Roughly your understanding is correct for standard plan and escalating plan.

 

[rizhal]

My beneficiaries will receive the remaining 180k (*300k - 120k)?

https://www.cpf.gov.sg/service/arti...ass away, your,with any remaining CPF savings.

How much CPF LIFE premium balance will my beneficiaries receive when I pass away?

After you pass away, your beneficiaries will receive your CPF LIFE premium balance, which is the total CPF LIFE premium that you have paid minus the total payouts you have received, together with any remaining CPF savings.

For example, if you paid a CPF LIFE premium of $200,000 and pass away after receiving a monthly payout of $1,000 for 10 months, we will pay your CPF LIFE premium balance of $190,000 (i.e. $200,000 - [$1,000 x 10 months]), together with any CPF savings to your beneficiaries.

On the other hand, if you pass away before receiving any payouts, we will pay your CPF LIFE premium balance of $200,000, together with any remaining CPF savings to your beneficiaries.

 

[JuniorLion]

Also, you are paying CPF Premium at 65 (or when you are going to start the payout), not 55.

 

[BBCWatcher]

My doubt is:
The CPF LIFE premium is the amount I deposit when purchase the CPF LIFE policy at 55 or is the amount plus interest accumulated at 65?

Neither. Under current rules the CPF LIFE premium is first computed shortly before payouts start. The default payout start is age 70, or the member’s age if the member is older upon joining CPF LIFE. (Any other starting age requires the member to act.) The premium is recomputed each time funds are added to the member’s CPF Retirement Account after the initial premium computation.

The first, older CPF LIFE cohorts are operating under somewhat different rules that no longer apply to younger cohorts. Premiums were initially computed at age 55 for the first wave of CPF LIFE participants. There was also a somewhat larger cohort with a default payout start of age 65. And CPF LIFE premium recomputations had to be requested for funds added to their Retirement Accounts. Now premiums are automatically recomputed even for those older cohorts.

Why do you ask, and why does it matter?

In summary, I’m still benefit for the interest between 55 to 65. But interest earn after 65 is go to the common pools to share across the cpf members.

No, this is a common myth the way you’ve phrased it. Your (and every CPF LIFE participant’s) monthly payout is computed inclusive of the interest paid after payouts start. If it weren’t then your monthly CPF LIFE payout would be much lower. You personally always benefit from CPF interest, for life. It’s your nominees who might be negatively affected by the longevity risk pooling, depending on how long you live. But the fact that you’re receiving higher monthly payouts for life means you drain other savings slower and/or your nominees don’t have to provide you with as much (or any) financial support. So they still win at least in those respects….

…..And that’s the “secret” to high quality longevity insurance. It frees you to defend a particular bequest from other assets or, better yet, to give heirs more wealth sooner. So if you want heirs to benefit it’s a fantastic tool.

 

[royalmix]

My doubt is:
The CPF LIFE premium is the amount I deposit when purchase the CPF LIFE policy at 55 or is the amount plus interest accumulated at 65?

Depends on your age. How old are you now? Older cohorts must join CPF Life at 55, new/current cohorts can join CPF Life at 65 or later. Premiums are only transferred to CPF Life Pool when you join CPF Life.

For example:
55 - deposit 200k
65 - with interest, 200k is become 300k

If I start receiving 1k per month after 65 for 10 years and pass away. My beneficiaries will receive the remaining 180k (*300k - 120k)?

In summary, I’m still benefit for the interest between 55 to 65. But interest earn after 65 is go to the common pools to share across the cpf members.

If you understand the differences among the 3 CPF Life Plans, you will understand how CPF Life actually works. Do not be misled or lose your common sense to academics!

1. Basic Plan: 10-20% of RA at 65 (if you choose to join at this age) goes to CPF Life Pool as Premium. The rest of the monies continue to sit in RA to earn 4+% plus extra interest of up to 3%pa

2. Standard & Escalating Plan - 100% of RA at 65 (if you choose to join at this age) goes to the CPF Life Pool as Premium. Interest of 4+% plus extra interest are paid into the CPF Life Pool (under your name). Payouts will be streamed out from Premium first until fully depleted before the payouts are streamed out from the Interest earned. Only unused Premium, if any, will be refunded to your bene upon death. Premium Interest earned and unused will go to the common CPF Life Pool upon death.

 

[dork32]

1. Basic Plan: 10-20% of RA at 65 (if you choose to join at this age) goes to CPF Life Pool as Premium. The rest of the monies continue to sit in RA to earn 4+% plus extra interest of up to 3%pa

fake news. since when ra earn extra 3%?

 

[dork32]

https://www.cpf.gov.sg/member/growi...ng-higher-returns/earning-attractive-interest

Cpf website say up to 5% or 6%. dont know where the 3% extra comes from

 

[royalmix]

fake news. since when ra earn extra 3%?

You are still below 55, of course you dun understand or lose your common sense to academics, misled by them and come here to spread fake news!

 

[dork32]

You are still below 55, of course you dun understand or lose your common sense to academics, misled by them and come here to spread fake news!

i quoted evidence from cpf site about up to 2% bonus interest. This is proof of my statement being real news. Can you quote something reliable to prove yours? if it is some academics and common sense then it is fake news

also the site i quoted includes those above 55 and those below 55.

 

[BBCWatcher]

I'd like to receive the extra 3% of CPF interest. Please DM me the promo code.

/j

 

[dork32]

so sorry, i just saw your common sense. 2% on the first 30k. 1% on the next 30k Total 3%.

Wah man. your academic common sense is so great. i really do not have it. you are really great man

it is so good that the academics at cpf cannot match it

 

[reddevil0728]

You are still below 55, of course you dun understand or lose your common sense to academics, misled by them and come here to spread fake news!

Please help people understand. thanks.

 

[dork32]

CPF have their own method of writing % , I have my own method to write too! You are can have your own!

I simplify to 3% on 30k = 900 pa. You break down using CPF details, it is also 900pa.

When will your CPF Life balances be depleted below 60k for Standard/Escalating Plan? Until it is depleted, you will continue to lose 3% on 30k = 900 pa. ! After that, the story is different!

Simplified maths, no need to use complicated maths!

your maths is so great. i really respect it. you win.

hey academics, your maths just cannot make it. listen to royalmix teach you maths

 

[royalmix]

your maths is so great. i really respect it. you win.

hey academics, your maths just cannot make it. listen to royalmix teach you maths

Of course I win! You never read what I write in details! I say up to, I never mention the amount and the details! So dun just jump to conclusion.

It is a waste of time to debate with you! Bye Bye!

 

[reddevil0728]

CPF have their own method of writing % , I have my own method to write too! You are can have your own!

I simplify to 3% on 30k = 900 pa. You break down using CPF details, it is also 900pa.

When will your CPF Life balances be depleted below 60k for Standard/Escalating Plan? Until it is depleted, you will continue to lose 3% on 30k = 900 pa. ! After that, the story is different!

Simplified maths, no need to use complicated maths!

your maths is so great. i really respect it. you win.

hey academics, your maths just cannot make it. listen to royalmix teach you maths

is like another @sohguanh? like want to change the definition of something, but yet don't want to make it clear. end up misleading people.

n when people don't understand, then say is their fault and call them fake news.

if intention is not to help people understand, then better just not to post? because the post will end up being meaningless?

 

[royalmix]

n when people don't understand, then say is their fault and call them fake news.

Your description matches exactly dork32, call fake news when he fail to read and understand!

Waste of time to deal with you too! Bye!

 

[reddevil0728]

Your description matches exactly dork32, call fake news when he fail to read and understand!

Waste of time to deal with you too! Bye!

understood. it's never your fault when you aren't clear.

it is always other people's fault and other people always fake news.

and yes you will always want to say you don't wish to waste time dealing with the fallout of you creating this mess and say bye, yet you will continue be tempted to come back and not bye.

Noted with thanks.

Important to call this behaviour out so that everyone can be aware of your style.

 

[dork32]

understood. it's never your fault when you aren't clear.

it is always other people's fault and other people always fake news.

and yes you will always want to say you don't wish to waste time dealing with the fallout of you creating this mess and say bye, yet you will continue be tempted to come back and not bye.

Noted with thanks.

Important to call this behaviour out so that everyone can be aware of your style.

this not a matter of style. the mathematics is wrong. this is primary school maths. dont come in with words like basis points when primary maths is missing.

For the 55 years old
If you have 30k, you get 6% interest.

if you have 60k, you get 5.5% interest.

If you have more than 60k, you get less than 5.5% interest.

There is not such thing as 7%. you cannot add interest this way in regular maths. you can only do it in academic common sense maths