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, 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:
- Fixed 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.
This article is for general information only it is not an advise nor does it take into account the specific investment objectives, financial situation or needs of any particular person. Read our General Disclaimer
Here are a few highlights
Best Retirement Plan for Disability Income Payout & Flexible Retirement Age – NTUC Gro Retire Flex
Best Retirement Plan for SRS & Retrenchment Payout Benefit – Manulife RetireReady Plus III
Best Retirement Plan for Flexible Disability Payout Option – Aviva MyRetirement Choice III
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 Coverage, Highest Yield and Flexible Retirement Age – NTUC Income Gro Retire Flex
Why is NTUC Income Gro Retire Flex good?
- Choice of premium term – Single Premium or 5/10/15/20/25/30 years
- (Flexible Retirement Age) after an accumulation period of minimum 5 to 50 for single premium and 10 to 50 years for regular premium.
- Choice of payout term – You can set the number of years (10 & 20 years or till age 100)
- (Highest Yield) – NTUC Gro Retire Flex has the highest yield among most permutations
- 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.
- (SRS Eligible) via Single Premium Option
- (Best Disability Coverage) – Waiver of all future premiums on the basic policy for the remaining premium term & will payout a lump sum equivalent to 6x the monthly guaranteed income during accumulation period & pay out 50% of guaranteed monthly cash benefit during payout period in the event of the following:
- Loss of use of one limb
- Loss of speech
- Loss of sight of one eye
- Loss of hearing
- Guaranteed Acceptance feature for the Main Plan.
- Retrenchment Benefit – Should you get retrenched and stay unemployed for 3 consecutive months, you do not have to pay premiums for your policy for 6 months. If you remain retrenched at the end of the 5th month when your premiums are waived, you can choose to defer the payment of premiums for your policy for the next 6
Why it may not be suitable for you?
- Choice of payout term limited to only 10, 20 years & till age 100
- While the disability income has a more lenient definition than the rest, the payout is only 50% of the guaranteed monthly income
Maximize your Payout & Best Disability Definition
The plan also comes with the highest guaranteed and non guaranteed yield across most permutations. There’s also an attractive cash benefit option where you can choose to accumulate your cash benefit and bonus at an interest of up to 3.25% per annum.
NTUC also gives the policy owner the best disability definition coverage base on the following – Receive additional coverage with Disability Care Benefit, if the insured is diagnosed with any one of these conditions due to accidental injury or sickness – loss of use of one limb, speech, sight of one eye or hearing.
Best Retirement Plan for Retrenchment Payout Benefit – Manulife RetireReady Plus III
Why is Manulife RetireReady Plus III good?
- 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.
- 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.
- Disability illness payout due to Loss of Hearing, Irreversible Loss of Speech and Major Head Trauma
- (Best in Retrenchment Payout Benefit), 50% of Annual Premium Paid out in the event the life assured is retrenched or unemployed for a consecutive period of 30 days
- Premium Freeze Option. Stop paying premium for 1 year while keeping your policy in forced
- 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.
- (SRS Payable) Payable via Supplementary Retirement Scheme (SRS)
Why it may not be suitable for you?
- 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 & Retrenchment Benefit Payout
The new Manulife Retire Ready Plus III is a copy and paste of the RetireReady II. It is still the only insurer with the retrenchment benefit payout option. A lump sum which consist of 50% (previously 40%) of the annual premium in the event the life assured has been retrench and unemployed for 30 consecutive days. There is also a premium freeze option where the life assured can exercise after a minimum of 2 policy years.
The Manulife RetireReady Plus III 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.
Best Retirement Plan for Flexibility Retirement Age and Disability Payout Option – Aviva MyRetirement Choice III
Why is Aviva MyRetirement Choice III good?
- (Best in Flexibility Disability Claim) Additional payouts under the Care Income Benefit should you be unable to perform at least 2 or 3 out of 6 ADL during the Income Payout Period, plus the choice to exercise the Fast Forward Option to receive a lump sum before your income payout.
- Choice of limited premium term – 5, 10, 15, 20 or 25 years.
- 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 is unable to do 3 out of 6 activities of daily living during payment term from age 18 – 65 & 2 out of 6 ADL from age 66 – 70
- Additional Guaranteed 0.5x Monthly Income Benefit if policyholder cannot perform at least 2 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?
- No Single Premium Option
- No SRS Options
Turn Your Monthly Disability Payout into Lump Sum
The Aviva MyRetirement Choice III ontop of providing flexibility in retirement age also provides additional payout upon partial disability. In such an event, the life assured can turn the monthly payout into a lump sum with the Fast Forward Option.
Head to Head Comparison
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.