... I wonder, how the hell can anyone PREDICT for sure that when
you are able to reach 62, you CAN live BEYOND 85???
... the only entity I can think of who is likely to be accurate in
this Longevity Prediction, is God.....
... is the FAP, God???
==============================
Annuities: Return of capital under study
Li Xueying
Sat, Dec 08, 2007
AsiaOne
SINGAPOREANS who fear they will lose the original sum they put into
the impending compulsory annuities scheme could have a way
out.
The committee studying the scheme is considering letting people
have the remainder of their capital payment returned to their
families if they died before it ran out. This will effectively
remove one of the biggest sticking points over the compulsory
annuity.
The idea is one of four suggestions emerging from the committee
tasked by the Government to design a basic compulsory annuity
plan.
Another idea is to rename the scheme from Longevity Insurance to
something more positive sounding such as Long-Life Income.
Yet another suggestion is to get independent actuaries - financial
experts who calculate risks and insurance rates - to verify the
Government's data on longer lifespans.
The fourth idea is to let people choose when they want to start
receiving their payouts.
Manpower Minister Ng Eng Hen and the committee's chairman,
Professor Lim Pin, revealed these ideas in separate interviews with
The Straits Times.
On the idea of getting back capital, Dr Ng said: 'People don't like
the idea of others getting their money...So we are going to
consider that they get whatever unused money back.
'Of course, the interest can never come back because this is locked
- the interest is pooled - but the sum that you put in at a
particular age, if you don't use it, it goes back to you.'
It will come with a trade-off though, noted Prof Lim. 'You will
have to pay higher premiums. It will be more expensive.'
An annuity is an insurance product in which a person invests a lump
sum in return for a monthly payout for life.
The committee was formed after Prime Minister Lee Hsien Loong
announced at this year's National Day Rally that Singaporeans must
buy an annuity so that they have an income for life.
Under the initial proposal, those below 50 will use part of their
Central Provident Fund money to buy the annuity and start getting
payouts at age 85.
But the committee will weigh all options and present its final
recommendations by March.
On changing the name of the scheme, Dr Ng said the committee told
him that people were uncomfortable with the thought of insuring
against a good outcome, which is a long life. Usually, people take
out insurance against illnesses, accidents, or death.
The Government has said that the annuities scheme is necessary, as
more than half of those who make
it to age 62 will live beyond 85 and they need to
have money then.
But the committee found that some still need to be convinced of
this data and hence, the independent actuaries.
Singaporeans are 'quite trusting and the Government has never
lied', said Prof Lim. But as this is an issue involving their
money, 'the trust, maybe, needs to be enhanced', he added.
Agreeing, Dr Ng said: 'There's no harm in appointing an independent
actuary to have a second look.'
On when people can opt to receive their payouts, he noted that they
wanted flexibility.
'So we're trying to consider, okay, you choose, any age from 65,
70, 75, 80, 85, 90.'
Singaporeans like trade officer Janagi Somu, 45, liked the idea of
getting back his annuity capital.
He said: 'It's only right that the money goes back to our
next-of-kin, since it's our hard-earned money.'
