CPF SA

[lifeafter41]

actually the large difference is not due compound interest. it is due to the pmt of 900 every year(+1% +1%)

10 years have 10 x 900 = 9000
120 months have 120 x 900 = 108000
difference already 100k without interest

cpf only compounds your interest yearly and not monthly

before i claim anymore credit, i would like to say that this method of calculation was taught by yywin.

I see dork......
The +1%, +1% gives the 900 max, understand now.

Is there aNother formulation to include a yearly top up to prevailing FRS or even ERS?

It’s just to see what’s the overall annuity insurance that’s going to be deducted when one reaches 65.

 

[dork32]

I see dork......
The +1%, +1% gives the 900 max, understand now.

Is there aNother formulation to include a yearly top up to prevailing FRS or even ERS?

It’s just to see what’s the overall annuity insurance that’s going to be deducted when one reaches 65.

if the topup is close to the 1 jan, you can just add the top up amount to the 900.

if the top up is all over the place, then i cannot come up with a fast way of estimating the answer. you will have to use the xirr formula or henry's type of spread sheet to calculate

 

[celtosaxon]

I can see why choosing Basic, Standard or Escalating appears to be a gamble. However, I would say it is providing flexibity based on your unique situation.

Let’s say a person has a certain genetic predisposition, family history or lifestyle that would make the chances of reaching their 90’s slim to none, AND this person also has a spouse and/or kids who would really stand to benefit from the bequest. This is probably the strongest case for choosing Basic.

However, let’s say this same person had nobody to leave the bequest to... Standard would be the clear choice.

Now, let’s say this same person has good genes, strong family history and excellent lifestyle... but nobody to bequest to. This would be the strongest case for Escalating.

Finally, what if a person with the good genes, stong family history and excellent lifestyle also has a family that would really benefit from the bequest? Basic Escalating would be best (if that was an option). It would be preferable if both Standard and Basic had an Escalating option. The current Escalating plan today is essentially Standard Escalating.

 

[BBCWatcher]

Now, let’s say this same person has good genes, strong family history and excellent lifestyle... but nobody to bequest to. This would be the strongest case for Escalating.

Actually, there are a couple other cases for the Escalating Plan that are probably even stronger. How about scenarios involving maximizing lifetime gifts and philanthropy? I think there are also certain cases involving protecting yourself against your future, less sensible self.

 

[henrylbh]

Standard Plan for those turning 55 this year.

[/url]

 

[celtosaxon]

Actually, there are a couple other cases for the Escalating Plan that are probably even stronger. How about scenarios involving maximizing lifetime gifts and philanthropy? I think there are also certain cases involving protecting yourself against your future, less sensible self.

There are other scenarios for sure.

But most important of all, while you are still young and able... strive to achieve the CPF trifecta:

1. BHS in MA
2. FRS in SA
3. ERS in RA

If not by 65 at least by 70.

 

[Kaypohji]

Nice this table is very clear

Standard Plan for those turning 55 this year.

[/url]

 

[maple96]

Now all the rubbish maths and opinions start flying around?

Who wrote the rubbish maths?

Who wrote all the rubbish opinions?

Who wrote rubbish opinions suggesting factors/criteria which will help u choose the right CPF Life Plan but never share how they apply those factors/criteria to make their own choice of CPF Life Plan and why they choose which plan?

Why are these considered rubbish opinions?

1. Based on their own personal situation/circumstances?
2. Based on what they know only?
3. Based on what they dunno?
4. Based on their own conscious and subconscious assumptions?
5. Always want to craft a standard mould to fit everyone into their one and only one perfect route to rome!

akan datang

 

[celtosaxon]

CPFL plans will probably change by the time most of us need to make a choice anyway.

It is easy to imagine that one day all plans will be escalating. It is only logical that income security should not be eroded by inflation over time, so I think the non-escalating plans days are numbered.

I would also say given the direction things have been going, the Basic plan could eventually be phased out. But before that, they need to address the whole lack of joint and survivor thing.

I’m sure there is a blue dot out there, but I suspect there is a generational CPF wealth gap that needs to be traversed before CPFL can reach the fully desired state.

 

[polyglob]

I’m sure there is a blue dot out there, but I suspect there is a generational CPF wealth gap that needs to be traversed before CPFL can reach the fully desired state.

I understood each word.

 

[maple96]

CPFL plans will probably change by the time most of us need to make a choice anyway.

It is easy to imagine that one day all plans will be escalating. It is only logical that income security should not be eroded by inflation over time, so I think the non-escalating plans days are numbered.

I would also say given the direction things have been going, the Basic plan could eventually be phased out. But before that, they need to address the whole lack of joint and survivor thing.

I’m sure there is a blue dot out there, but I suspect there is a generational CPF wealth gap that needs to be traversed before CPFL can reach the fully desired state.

U can think whatever u want and continue to procrastinate cos u still have a long way to go, not everyone here are like u, has more than 20-30 or so years to reach 55 or 65. u obviously are too young to know what u dunno about CPF Life in Singapore!

Dun write rubbish if those are not your own criteria/factors to choosing CPF LIfe. U might even leave Sg for good by giving up your PR! U people like to live in an ideal world!

Dun continue to talk rubbish here!

 

[maple96]

actually the large difference is not due compound interest. it is due to the pmt of 900 every year(+1% +1%)

10 years have 10 x 900 = 9000
120 months have 120 x 900 = 108000
difference already 100k without interest

cpf only compounds your interest yearly and not monthly

before i claim anymore credit, i would like to say that this method of calculation was taught by yywin.

Is this rubbish (in red above)?

Max extra interest is 900 per annum!

If u start CPF Life payout at 65, assuming u die at 80 under CPF Life Standard, CPF Life Pool would have eaten up 15 years of extra interest = 900*15 = 13.5k

Compound interest at 4% after 15 years estimated at 5.2k

Total only 18.7k

The bulk of your donation to CPF LIfe Pool is 4% compounded interest on your CPF Life Premium!

 

[maple96]

I see dork......
The +1%, +1% gives the 900 max, understand now.

Is there aNother formulation to include a yearly top up to prevailing FRS or even ERS?

It’s just to see what’s the overall annuity insurance that’s going to be deducted when one reaches 65.

Use this compound interest calculator to do your estimates

https://www.calculator.net/interest-calculator.html


If u opt to start your CPF Life payout at 65 with Basic Plan, CPFB will calculate 10-20% of your RA balance at 65 and transfer it to CPF Life Pool as premium.

 

[celtosaxon]

U can think whatever u want and continue to procrastinate cos u still have a long way to go, not everyone here are like u, has more than 20-30 or so years to reach 55 or 65. u obviously are too young to know what u dunno about CPF Life in Singapore!

Dun write rubbish if those are not your own criteria/factors to choosing CPF LIfe. U might even leave Sg for good by giving up your PR! U people like to live in an ideal world!

Dun continue to talk rubbish here!

7 years to reach 55, so it has become a concern... and I like to make informed decisions.

To that end I’ve done several rounds of in-depth CPFL modeling with IRR calculations and pairwise analysis between all of the possible payout plans at every year of payout. I can see down to the dollar exactly how much difference there is for each plan and what it means at each stage in terms of a return on investment.

Doing this anaysis is what convinced me that CPFL is not only worth keeping, but maximizing up to ERS if possible.

 

[dork32]

I can see why choosing Basic, Standard or Escalating appears to be a gamble. However, I would say it is providing flexibity based on your unique situation.

Let’s say a person has a certain genetic predisposition, family history or lifestyle that would make the chances of reaching their 90’s slim to none, AND this person also has a spouse and/or kids who would really stand to benefit from the bequest. This is probably the strongest case for choosing Basic.

However, let’s say this same person had nobody to leave the bequest to... Standard would be the clear choice.

Now, let’s say this same person has good genes, strong family history and excellent lifestyle... but nobody to bequest to. This would be the strongest case for Escalating.

Finally, what if a person with the good genes, stong family history and excellent lifestyle also has a family that would really benefit from the bequest? Basic Escalating would be best (if that was an option). It would be preferable if both Standard and Basic had an Escalating option. The current Escalating plan today is essentially Standard Escalating.

fair enough statement. you are saying different scheme fits different people. there is no one solution for all.

 

[dork32]

Is this rubbish (in red above)?

Max extra interest is 900 per annum!

If u start CPF Life payout at 65, assuming u die at 80 under CPF Life Standard, CPF Life Pool would have eaten up 15 years of extra interest = 900*15 = 13.5k

Compound interest at 4% after 15 years estimated at 5.2k

Total only 18.7k

The bulk of your donation to CPF LIfe Pool is 4% compounded interest on your CPF Life Premium!

maybe you missed the earlier post. we were discussing with a ra of 270k at 55, wat the cpf would be like at 65.

my number is 410k
lifeafter gave a 570k.

i am telling the error in his calculation that resulted in such a high sum. it is because he assumed a 900 every month. my calculations is 900 every year.

 

[dork32]

CPFL plans will probably change by the time most of us need to make a choice anyway.

It is easy to imagine that one day all plans will be escalating. It is only logical that income security should not be eroded by inflation over time, so I think the non-escalating plans days are numbered.

I would also say given the direction things have been going, the Basic plan could eventually be phased out. But before that, they need to address the whole lack of joint and survivor thing.

I’m sure there is a blue dot out there, but I suspect there is a generational CPF wealth gap that needs to be traversed before CPFL can reach the fully desired state.

we have discussed this many times. everyone with a little bit of common sense will know that escalating is the way to go. who doesnt want their payout to increase every year.

the problem here is because the cost of escalating plan is very high in the initial years. you will have to wait for about 12 years before catching up with standard just with the payout. and you have to wait another 15 years before the total sum + interest can over standard. you add that up, you are 93 years old by then. this is the reason why many of us as so turned off by escalating.

my calculations above show 12 and 15 years.

if an escalating plan that gives 8 and 11 years, may more will jump on board.

if it is 15 and 18 years, then just forget it.

 

[maple96]

7 years to reach 55, so it has become a concern... and I like to make informed decisions.

To that end I’ve done several rounds of in-depth CPFL modeling with IRR calculations and pairwise analysis between all of the possible payout plans at every year of payout. I can see down to the dollar exactly how much difference there is for each plan and what it means at each stage in terms of a return on investment.

Doing this anaysis is what convinced me that CPFL is not only worth keeping, but maximizing up to ERS if possible.

U still have not answered or share what is your choice of CPF Life Plan based on your own criteria/factors u recommended in your earlier post

 

[henrylbh]

our collective understanding is this:

they take away 20%. but this 20% is still yours. if you die, the amount can be bequested. but this 20% would not be earning interest for your ra. it earns interest for a common pool, which some funny people feel that it is still their. this common pool is used to provide the payouts for the immortals. you will first draw from your ra, then the pool.

the thing is we could be entirely wrong.

the other thing is it cannot be 20% of frs. it is 20% of what you have in your ra.

Our understanding is not my understanding

 

[dork32]

To that end I’ve done several rounds of in-depth CPFL modeling with IRR calculations and pairwise analysis between all of the possible payout plans at every year of payout. I can see down to the dollar exactly how much difference there is for each plan and what it means at each stage in terms of a return on investment.

wonderful. can you tell every everyone what is the irr for standard and escalating for the first 15 years? and can you tell everyone at what age will the irr of escalating overtake that of standard.