Retirement planning is a critical milestone for Singaporeans, and CPF LIFE provides a “pension” with lifelong monthly payouts. However, selecting the right plan requires some thought. Here’s a brief overview of the three CPF LIFE options:
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Source: CPF Board Website
1. Basic Plan
Features: Offers lower monthly payouts initially, which decrease over time as your Retirement Account (RA) savings are depleted. This plan leaves a higher bequest for beneficiaries.
Best For: Individuals who prioritize leaving a legacy and are comfortable with modest payouts during retirement.
2. Standard Plan
Features: Provides steady monthly payouts throughout your life. While it ensures financial stability, it does not account for inflation.
Best For: Those who prefer consistent budgeting and are okay with adjusting spending as prices rise.
3. Escalating Plan
Features: Starts with lower payouts that increase by 2% annually to address inflation concerns.
Best For: Retirees who anticipate rising expenses and want to maintain their purchasing power.
