CPF chats

[Squaredot]

perhaps could be referring exiting CPF Life in event of Terminal Illness.

https://www.cpf.gov.sg/members/FAQ/... you will receive,the form of monthly payouts.

though this shld apply to all 3 LIFE plans, perhaps Basic (with just 10-20% upfront premium deducted), one is more assured of getting back the remaining 80% ?

what he/she means is if kanna terminal illness/critical illness, can request to take out balance unused CPF/bequest amount which is higher compared to the other 2 plans over time.

Ah I see! thanks bros, you guys are smart!

Maple, thanks for replying.
I will consult u in near future..I'm not v far to 65

 

[peppermint7]

Ah I see! thanks bros, you guys are smart!

Maple, thanks for replying.
I will consult u in near future..I'm not v far to 65

Squaredot I will come consult u when I'm near 65

 

[yongsaver]

I know shiny things is a Male cos I googled saw his pic. But how u know BBCW is a Male? I googled but can't find BBCW pic..

me guessing nia from the way he/she writes la.

 

[Squaredot]

Squaredot I will come consult u when I'm near 65

I'm an old baby at CPF stuff
Will share what I know but afraid unable to offer helpful advice

 

[SBC]

Ah I see! thanks bros, you guys are smart!

Maple, thanks for replying.
I will consult u in near future..I'm not v far to 65

The idea is to start early. There are no magic or cut short.
If there is any magic, the magic is coming from power of compounding.

Plan early so that you dun need to worry much towards 55 to 60 period.

CPF Top up:
- Cash top up to SA, if FRS in SA is not hit. Up to 7k per year
- contribute to parents’ RA. Up to 7k per year
- VC to your own MA (tax deductible) or OA (non tax deductible)

Participating insurance policy;
- I am also a believer of insurance. Used it as part of my financial planning as well as for protection.
- my current total surrender value is abt $290k.
- older policies tend to give better returns.

 

[Conor McGregor]

People dun know what they dun know!

I parked my emergency funds in DBS Multiplier, earning up to 3.5%pa easily! (in fact is more than 4.3% if I count the angbao of $200, up till Aug 2020)

I parked my longer term funds in WL (mthly autopilot savings) giving me 4-5% pa compounded, and CPF more than 2.5%

Dun put your capital as risk just to get higher returns, if these are emergency funds.

Dun compare chicken and duck!

(this is not CPF related topic)

Agreed!! I’m doing the same too..

Higher risk higher returns

It’s always all about risk appetite

No right no wrong to go for this route or another route

 

[Conor McGregor]

I think depends on how much cash you have and want to use for your property purchase. OA can be used in your purchase.


-Edit : apologies, for VC not tax deductible as corrected by elf108

I want to use as little cash as possible

5% of property price - 50k for example

What’s the game plan

 

[zoneguard]

If there is any magic, the magic is coming from power of compounding.
CPF Top up:
- Cash top up to SA, if FRS in SA is not hit. Up to 7k per year
- contribute to parents’ RA. Up to 7k per year
- VC to your own MA (tax deductible) or OA (non tax deductible)

A suggestion for the compounding power to have a longer runway to work its magic is to VC to your child/ren's CPF accounts if you have spare cash. Your gift will be a big sum when they reach 55.

 

[Kaypohji]

WL life returns r non guaranteed right?

Nowadays ppl advocate buy term invest the rest. I’m thinking those extra premiums saved could be put into sa/oa

People dun know what they dun know!

I parked my emergency funds in DBS Multiplier, earning up to 3.5%pa easily! (in fact is more than 4.3% if I count the angbao of $200, up till Aug 2020)

I parked my longer term funds in WL (mthly autopilot savings) giving me 4-5% pa compounded, and CPF more than 2.5%

Dun put your capital as risk just to get higher returns, if these are emergency funds.

Dun compare chicken and duck!

(this is not CPF related topic)

 

[maple96]

WL life returns r non guaranteed right?

Nowadays ppl advocate buy term invest the rest. I’m thinking those extra premiums saved could be put into sa/oa

Every year returns are declared, once declared it is guaranteed, so I am sharing surrender values, guaranteed returns of 4-5% compounded. No point talking about non guaranteed at this stage of my policies, I am not interested in what is in the BI.

Only people who own WL knows how it actually works.

 

[oceanicmanta]

Every year returns are declared, once declared it is guaranteed, so I am sharing surrender values, guaranteed returns of 4-5% compounded. No point talking about non guaranteed at this stage of my policies, I am not interested in what is in the BI.

Only people who own WL knows how it actually works.

do u mean the bonuses are declared yearly ? (instead of returns)

for my WL, bonus rates & bonuses r declared annually, but dont recall seeing declared returns in insurer's communication

4-5%pa guaranteed returns, not including non-guaranteed portion, is really impressive ... dont think mine comes close, particularly after the cuts in projected terminal value in 2008

 

[zoneguard]

Every year returns are declared, once declared it is guaranteed, so I am sharing surrender values, guaranteed returns of 4-5% compounded. No point talking about non guaranteed at this stage of my policies, I am not interested in what is in the BI.

Only people who own WL knows how it actually works.

So the intention is to surrender the policy upon retirement?
Only a XIRR calculation upon surrender with the cash value and all the premiums paid over the policy lifetime is a true reflection of the policy CAGR.

With all the cost overheads the insurer has and they are after all a profit&loss entity, 4% is really very good...or too good to be true. I'll be interested to know what investments the insurer has invested in.

 

[8zaoyu]

BBC - u may be have experience in placing some "Atas" high class insurances or investments. But I have gotten burnt in all these, and now wise up, the lucky part is by 55 yrs of age, I have paid up all the mortgages every time I upgraded my property.Don't need any advice on tax, as not much tax which I gladly pay for "nation building" - It is you who are foreigners whom we give you low tax (you behave to want to invest or find ways to save on taxes)so that we can " trap" you here. Be trap here, you will go back to worse off back non SG home. Join our local coffeeshop seniors gathering to help those who don't want to put back into CPF at least to fill to the FULL target with mortgage fully paid and teach them not to get scammed. Some local seniors seem to spend on gambling 4Ds/Toto rather than understanding stocks and dividends. And most did not earn incomes to be taxable and would not want their kids to give them 7k CPF to save on taxes. Instead, just give them $20 allowance daily.

 

[terence2112]

If only CPF board can keep it simple. Then there will not be endless discussion

Yes this is right. There’s just too many schemes in CPF. I always advocate topping up MA to the BHS, and let the overflowing to SA create wonders.

 

[SBC]

A suggestion for the compounding power to have a longer runway to work its magic is to VC to your child/ren's CPF accounts if you have spare cash. Your gift will be a big sum when they reach 55.

I am some small amount of VC to my kids’ CPF.

After taking care of mortgage payment, family expenses, insurance premium, there are not much balance left.

VC to kids’ has the adv of pretty high interest rate. Probably be close to 3.8% effectively.

 

[Andrew833]

Squaredot I will come consult u when I'm near 65

I will share here after I 55, withdrawal my cpf money

 

[Squaredot]

do u mean the bonuses are declared yearly ? (instead of returns)

for my WL, bonus rates & bonuses r declared annually, but dont recall seeing declared returns in insurer's communication

4-5%pa guaranteed returns, not including non-guaranteed portion, is really impressive ... dont think mine comes close, particularly after the cuts in projected terminal value in 2008

yes very impressive at 4-5% guaranteed. Likely to be very old policies with more generous bonus payout rate.

mine can get 3%+ guaranteed i quite happy liao. There is one insurance coy very quick at cutting project maturity value, I recd two cuts before it matured. Terrible.
Now with covid, policyholders gotto brace for another such letters

 

[maple96]

So the intention is to surrender the policy upon retirement?
Only a XIRR calculation upon surrender with the cash value and all the premiums paid over the policy lifetime is a true reflection of the policy CAGR.

With all the cost overheads the insurer has and they are after all a profit&loss entity, 4% is really very good...or too good to be true. I'll be interested to know what investments the insurer has invested in.

Young man, u obviously dun own any WL policies, so u dunno how it works, how to calculate returns, make financial decisions on that investment, etc.

U dunno what u dunno to make such comments, implying I dunno how to calculate, provide false info about the returns of my WL policies?

U also dunno what contributes/determine return on investments. If u are savvy fund manager, u should know active and smart management of the funds contributes to good returns, and not passive, blindly following some dca methodology into some u think are good investments like etfs/funds over the long term that determines your returns.

Why should I kill the golden goose that lay the golden eggs? I should kill CPF OA first right?

When should I kill the golden goose? I never look at all my policies until the past few years when I need to decide where I should tap my funds from since I no longer need the insurance coverage. Then I chance upon an article by TKL (ex ceo) advising someone that he should kill his WL and the reasons. So I decided to review my policies and do some calculations to see if his reasons are correct. I was shocked my policies are doing so well (per my benchmark) – compound interest of 4-5% pa from start of policy. Recently, I started to look at yearly returns, wow why should I kill the policies giving such good yearly returns which CPF also cannot give?

U doubt my calculations? I can tell u, it is even better than your irr and cagr formula. I use this internet calculator, using “reverse engineering” method, to give me the interest rate. I have deep vested interest to make sure my calculations are correct to make critical financial decisions and financial planning for my future. https://www.calculator.net/interest-calculator.html

I am not here to sell u or convince u that WL is good, I am just sharing my own financial planning, my good luck to be owning such good policies, what u dunno but think u know, etc

If u believe people will teach u the secret to making money, if it works, without any hidden objectives, good luck to u. I am not teaching u the secret, I am sharing some secrets which WL and endowment policy owners dun share about their good fortunes, what is being shared are usually the unfortunate, the losers, the bad and ugly side of it. Good things dun need to share, these are “old timers”, can u repeat their feat?

 

[maple96]

do u mean the bonuses are declared yearly ? (instead of returns)

for my WL, bonus rates & bonuses r declared annually, but dont recall seeing declared returns in insurer's communication

4-5%pa guaranteed returns, not including non-guaranteed portion, is really impressive ... dont think mine comes close, particularly after the cuts in projected terminal value in 2008

There are different types of WL policies in the market. different insurers sell different policies and provide different types of policy info to customers.

Some agents will use the insurers par fund performance to con people that theirs is better than others. But different policies have different par funds or no par funds, which explains why some policies do better than others within the same insurer. My friend was lucky to bought a 20year single premium endowment plan, matured with more than 5% compounded returns, better than mine, a different policy from the same insurer with shorter tenor of 11 years, at more than 4%.

My policies – insurer declares bonus every year, it goes to increase the sum assured, I dun usually read or check. I check the mthly and/or annual statement account which shows the sum assured+bonus=new sum assured, surrender value I will get if I surrender anytime, etc. So I just compare surrender value this mth vs last mth, this year vs last year, to make myself happy. Then do some calculations on the % of returns.

 

[oceanicmanta]

@maple - understand what u mean now.

I will take a look again at my WL ... mine GE definitely not as good.

as u said, many myriads of WL out there, not all the same