Should I opt out of DPS?

[Xrocker]

Hi,

I am currently working part time and will be quitting my job soon to prepare for my uni course(4 years.) I was thinking if I should opt out of the Dependant Protection Scheme for these 4 years and only opt in when I start working again.

Because I did work after my Olvl, and earned quite a measly amount. At that point in time, I was auto-opted in to DPS. When I check my account after 4 years(schooling and NS), the amount in my OA dropped lower than it was before, since the interest earned per year couldn't cover the annual payment for the DPS. My current situation will be similar as well, since after my current CPF contributions from this work stint, the amount in my OA is still very little. The interest earned still doesn't cover the DPS payment.

Should back to my question if I should opt out now and then opt in after 4 years later when I start working?

 

[NiteX2]

I would suggest that you stay with DPS, unless you are pretty sure that there will not be any changes to your health in the next 4 years. Opting in again requires health declaration and insurer will likely exclude if one develops certain conditions over the next few years.

I think you should have 4 x $36 = $144 in your OA and SA account even if you are working part time.

 

[archcherub]

I would suggest that you stay with DPS, unless you are pretty sure that there will not be any changes to your health in the next 4 years. Opting in again requires health declaration and insurer will likely exclude if one develops certain conditions over the next few years.

I think you should have 4 x $36 = $144 in your OA and SA account even if you are working part time.

even if u really dont have $144 inside ur CPF..
top up a bit inside?
$36 per year is really very affordable for that amt of insurance.

 

[Tornesoul]

its really cheap annually.

 

[goldsilvercity]

stick to it pls.
its awfully cheap, no other private insurer can match it....

 

[IIIUSION]

Yea DPS is good don't cancel

 

[Kissmequick]

Some insurance is better than no insurance and hope TS is convinced by advice given here to continue with it.

If you are still undecided, just think of it this way.

$36 a year works out to 0.10 cents a day. Don't opt out.

 

[VictorvonDoom]

DPS is really affordable for the coverage you're getting.

 

[Perisher]

The advise given here is valid.

Let me address your main concern which is your rather low amount in your CPF OA. According to my calculation, you have less than $1000 in your CPF OA which explains why it isn't enough to cover the $36/year with the interest earned.
4 year Cost = $36*4 = $144.

What does this $144 do in terms of helping your CPF OA?
1 year of $5.04...
Compounded over 4 years = $165.24 -$144 = $21.24 Interest

So you are just giving up $21.24 of interest to get a protection that pays you $46,000 if anything happens. Sounds like a good deal.

Is it worth it to cancel a plan that covers you for 4 years just to save you $21.24 in interest?

$165 over 4 years is $0.11/day. Giving up $46,000 for $0.11 a day, worth it?

After you graduate, set aside a sum of $$ and learn to invest, you will earn back that $165 before you know it.

 

[hwmook]

Hi,

I am currently working part time and will be quitting my job soon to prepare for my uni course(4 years.) I was thinking if I should opt out of the Dependant Protection Scheme for these 4 years and only opt in when I start working again.

Because I did work after my Olvl, and earned quite a measly amount. At that point in time, I was auto-opted in to DPS. When I check my account after 4 years(schooling and NS), the amount in my OA dropped lower than it was before, since the interest earned per year couldn't cover the annual payment for the DPS. My current situation will be similar as well, since after my current CPF contributions from this work stint, the amount in my OA is still very little. The interest earned still doesn't cover the DPS payment.

Should back to my question if I should opt out now and then opt in after 4 years later when I start working?

DPS is just cheap term insurance, if you think you cannot afford $36 a year or $3 a month, $0.10 a day then just cancel it. IMO, there is no point doing so. Why save that $36 in your OA anyway?

 

[Xcert]

My suggestion is to keep the DPS because u can never know what is going to happen in the 4 years.

Sent from Kindle Voyage using GAGT

 

[ussr_1991]

Since you have served NS, hence there is chance that you have the Aviva Group Term Insurance unless you opted out in BMT and your Sir / Sgt will call your parents for that. (Unless you served your NS before 2009 or so, if I am not mistaken)

IF you did NOT cancel your AVIVA Insurance, it is better to keep that for $100k protection than DPS since DPS is fixed to payout at $50k or so given that DPS only insure until 60 while AVIVA insures until 65 and further annual renewal to 70 is possible.

Whats more, you can insure your spouse for the same coverage in future.

So what I did was, cancel DPS and stick with AVIVA instead.

If you had cancelled the AVIVA, then I think you can rejoin when you go for your reservist (Unless you got PES E or C and reservist is less likely). Don't forget that AVIVA one is more catered for things happened in SAF at the same time covers things that are outside of SAF while DPS cover only the latter if I am not mistaken.

 

[iamverybuaysong]

i have both aviva 200k, DPS and other insurances

i think the small premium is worth it.

for DPS, $36 a year, for aviva $25 a month before the rebate. Past 2 years i only paid around $15 a month after rebate.

maybe go find tuition to teach lo, 1 month $300, can pay whole year premium already.

 

[cheong79]

Some people buy 4D toto for 1 week mon wed thur sat sun already $50!

Wat is $36 a year?

 

[laksa2003]

Dps is one of the super value insurance u can ever buy

 

[GenerationX]

i did not see any amt deduct for $36. i guess im out? So shall i go opt in on mon?

dint know abt this until i saw this thread..

 

[Xrocker]

Thanks for the feedback everyone. I guess I wont opt of DPS then. Will probably be going for aviva too(I forgot to extend the coverage after I orded, and thus am not covered under Aviva)

 

[Futureskid]

U should opt out of DPS, buy aviva if u want like what ussr1991 said.

Is not a matter of cheap insurance, but rather if its relevant to u. U have no dependents, I read DPS is only for death and permanent incapacity, an insurance like aviva would have cover more.

So what if is cheap, if the product is useless to u, then is a useless product to buy.

 

[VictorvonDoom]

U should opt out of DPS, buy aviva if u want like what ussr1991 said.

Is not a matter of cheap insurance, but rather if its relevant to u. U have no dependents, I read DPS is only for death and permanent incapacity, an insurance like aviva would have cover more.

So what if is cheap, if the product is useless to u, then is a useless product to buy.

It's cheap and most importantly it's paid using CPF. That makes it very attractive

 

[goldsilvercity]

Thanks for the feedback everyone. I guess I wont opt of DPS then. Will probably be going for aviva too(I forgot to extend the coverage after I orded, and thus am not covered under Aviva)

DPS is really good.

avivia is not bad too, even after ORD..
but if u dont have the cash, can skip aviva for now till u start working, but do keep your DPS