What is a Retirement Annuity Policy?
An annuity policy offers a minimum guaranteed monthly income either for life or a fixed number of years. Premium is paid over a pre-determined number of years or until age 65 to 70. The duration of the payout can be adjusted according to individual financial needs.
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What benefits does a retirement annuity plan offers?
Life after retirement should ideally be a smooth sailing process with an occasional enjoyment of the finer things in life, instead of worrying about the cost of daily living. A monthly payout from an annuity policy supplements income received from CPF Life, allowing more financial options in life.
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” In this world, nothing can be said to be certain, except death and taxes.”
-Benjamin Franklin, Founding Father of the United States.
As a participating life insurance policy, annuity plan offers a guaranteed monthly income and a non-guaranteed monthly income depending on how the investment returns of the insurer fares. Some annuity plans also offer partial lump sum withdrawal, additional monthly payout upon failing three or more out of six activities of daily living and/ or the waiver of premiums should any major cancer strikes.
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Do I really need an annuity Plan for retirement planning?
A retirement annuity plan is not necessary if funds are accumulated via other means such as an Investment Portfolio or other insurance policies. Ensure that the effects of inflation are taken into account when planning for your financial goals.
Depending on individual preferences, multiple Whole Life or Savings Endowment policies with staggered maturity can also provide a lump sum payout once every few years into your retirement age.
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Alternatively, Unit Trust Funds with dividend payout may also provide a monthly income during your retirement years. Whichever method you seek toward your retirement goals, ensure it is practical and within your affordability.
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Compare before you commit
Before committing to an insurance policy, it certainly pays to make an effort to compare. Specific products features, benefits and payout will differ more than you think across insurance companies.
Why regret only years later, when you find out that you are not getting the best insurance policy available for the premium paid?
Even worse, to know you can compare retirement plans and policies here, 100% free of charges on the InterestGuru.sg platform.
Where can I compare the payout and benefits of Annuity Policies?
Drop us a message should you require additional information and we will get back to you on your questions as soon as possible.
