3 Best Retirement Plans in Singapore In Terms of Coverage, Guaranteed Returns and Flexibility

CPF Life makes a good Retirement plan in the sense that you get a fixed amount of pay-out each month following retirement. However, as mentioned in our CPF article, the amount of pay-out may not be adequate to fulfil one’s retirement lifestyle aspirations. Compared to other retirement plans in the market, it also falls short on certain aspects. For instance, CPF Life does not quite provide for old-age needs, such as the increased risks of illness or disability.

Furthermore, unlike commercial plans – CPF LIFE lacks flexibility in allowing you to receive different amounts of pay-out along the way, or for you to choose to receive a lump sum instead. To make up for these gaps, it is best to combine CPF LIFE with another retirement plan.

Here, we look at 3 of the best retirement plans and examine their key differences and benefits to bring you the ideal solution in supplementing your retirement lifestyle. Before we elaborate on each of these plans in detail, I would like to highlight some of their basic features: Most retirement plans available here are based on a

• Fxed premium term of your choice,
• An accumulation period and
• A payout period.

For instance, if Ivan is currently 40 years old, his retirement plan may look like the following:

• 10-years Premium term: 41 to 50 years
• 10-years Accumulation period: 51-60 years old
• 30-years Payout Period: 61 to 90 years old.

Here are a few highlights

Best Retirement Plan for Disability Payout –  NTUC RevoRetire

Best Retirement Plan for Lifelong Annuity & Guaranteed Income – Manulife RetireReady Plus

Best Retirement Plan for Flexibility & Guaranteed Income – Aviva MyRetirement Choice

How do we filter?

Most importantly, ALL of these plans are capital guaranteed and encompass an additional non-guaranteed benefits component. This means that as long as you stick and follow through with these policies, you are guaranteed to receive more (in the form of monthly payouts) than the total amount you saved into these policies. On top of the monthly payouts, each plan comes with a protection component as well, which includes a Death Benefit, and all 3 selected plans include an income pay-out for disability.

Our pick for the 3 Best Retirement Plans in Singapore In Terms of Coverage, Guaranteed Returns and Flexibility are based on the criteria below:

• Flexibility in terms of payout with no minimum age
• Flexibility in terms of payout with no fixed period from 1 – 35 years income
• Guaranteed Returns in terms of highest guaranteed yield with capital guaranteed
• Coverage in terms of leniency of claim in the event of disability or illness
• Product features unique to the listed retirement plans

Best Retirement Plans for Disability Payout  – NTUC Income RevoRetire

Why is NTUC Income RevoRetire good?

• Choice of premium term – 5 years, 10 years, or up to 5 years before the end of your accumulation period.
• Choice of retirement age – Start receiving your monthly cash benefits after an accumulation period of just 10 or 15 years, or at age 50, 55, 60 or 65.
• Choice of payout term – You can set the number of years (10, 20 or 30 years) to receive your monthly cash benefits. Enjoy the flexibility to change your selection any time before your first monthly cash benefit is due.
• Death benefit – Pay-out of 105% of all net premiums paid, and 100% of terminal bonus if death occurs during the accumulation period. Additional 105% of all net premiums paid if accidental death happens before age 70.
• (Best in Coverage) Disability Benefit – Waiver of all future premiums on the basic policy for the remaining premium term. Pay-out of a lump sum benefit, equivalent to six times of the monthly cash benefit is accorded when any of the following occurs during payment period:

1. Loss of use of one limb
2. Loss of speech
3. Loss of sight of one eye
4. Loss of hearing

• Additional Guaranteed 1x Monthly Income Benefit if p cannot perform any of the above during retirement pay-out period.
• Guaranteed Acceptance feature for the Main Plan.

Why it may not be suitable for you?

• Choice of payout term limited to only 10 years, 20 years or 30 years.
• Guaranteed Income is lowest as compared to Manulife and Aviva
• Payment term limited to only 5 or 10 years or Regular pay
• Earliest Retirement Age is 50
• Retirement Age is fixed @ interval of 5 years e.g. 50/55/60
• Does not have single premium option
• No SRS Options

Flexibility to change pay-out term

Based on an annual premium of $9,641.15, your guaranteed yield to maturity is at 2.12%, but the projected non-guaranteed yield is at 4.29%. The plan also comes with cash benefit option where you can choose to accumulate your cash benefit and bonus at an interest of up to 3.5% per annum.

NTUC also gives the policy owner the flexibility to change their pay-out term at any point before the first monthly cash benefit pay-outs during the retirement age.

Best Retirement Plan for Lifelong Annuity & Guaranteed Income – Manulife RetireReady Plus

Why is Manulife RetireReady Plus good?

• Guaranteed returns up to 2.60% per annum. Total income up to 4.43% over the life of the plan with annual bonus before retirement and cash bonus after your selected retirement age.
• Choice of limited premium term – Single Premium, 5, 10, 15 or 20 years.
• Choice of retirement age – Retire at 50, 55, 60, 65 or 70 years old.
• (Best in Lifelong Annuity) Choice of payout term – 5,10,15,20 years Payout or Lifetime Payout.
• Disability Benefit – Waiver of all future premiums if policyholder is unable to do 2 out of 6 activities of daily living (ADL)
• Additional Guaranteed 1x Monthly Income Benefit if Loss of Independence (inability to do 3 out of 6 ADL) occurs during your retirement pay-out period.
• Additional Guaranteed 0.5x Monthly Income Benefit if Intermediate Stage Loss of Independence (inability to do 2 out of 6 ADL) occurs during your retirement pay-out period.
• The plan does not require any medical underwriting.
• Payable via Supplementary Retirement Scheme (SRS)

Why it may not be suitable for you?

• Lifetime annuity option has a very low starting income payout
• Earliest retirement age is 50
• Retirement age is fixed at intervals of 5 years eg. 50/55/60
• Income payout limited to intervals of 5 years as well

The SRS Option

Another fabulous feature of the Manulife RetireReady Plus is that it allows you to use the funds in your Supplementary Retirement Scheme (SRS) to pay for the premium as a single premium. As some of us might know, SRS is a savings plan that helps to complement your CPF savings for retirement and one of its most attractive factors is that you enjoy tax deferment when you contribute to your account.

So for those who have been contributing to your SRS account diligently, you can use the money in this account to pay for the premium of the Manulife RetireReady Plus since it counts as a Single-Premium product.

Best Retirement Plan for Flexibility & Guaranteed Income – Aviva MyRetirement Choice

Why is Aviva MyRetirement Choice good?

• (Best in High Guaranteed Income) Guaranteed returns up to 2.63% per annum.
• Choice of limited premium term – 5, 10, 15, 20 or 25 years.
• (Best in Flexibility) Choice of retirement age – Retire at any age.
• (Best in Flexibility) Choice of pay-out term – from 5 to 35 years.
• Death benefit – Death and Terminal illness coverage.
• Disability Benefit – Waiver of all future premiums if policyholder becomes Totally and Permanently Disabled.
• Additional Guaranteed 1x Monthly Income Benefit if policyholder cannot perform at least 3 out of 6 activities of daily living during retirement pay-out period.
• Guaranteed Acceptance feature for the Main Plan and its riders.

Why it may not be suitable?

• Disability claim is the most stringent as compared to Manulife & NTUC
• No Single Premium Option
• No SRS Options

Highest Guaranteed Income

Based on a policy term of 50 years and a 10-year premium term, the annual premium comes up to $8,474 for a $500 monthly income. Just looking at the guaranteed benefits, you will break-even in as short as 10 years.

Out of the three plans here, the Aviva MyRetirementChoice provides the highest guaranteed yield of 2.63%. The other fabulous feature here is the flexible retirement age.

Now, let’s look at how these 3 products compare*:

As with all retirement plans, each retirement plan has its own advantage and strength. Individuals should not simply base their decision on maximum payouts alone, but with regards to their life circumstances and financial plans.

What do you do next?

Get all three insurers quotes for the best Coverage, Guaranteed Returns and Flexibility Retirement Plan Here !

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All comparisons done are solely based on your individual needs.