Originally posted by googoomuck:
[b]Here's a story of one unhappy annuity
investor.
I TRANSFERRED $37,000 from my Central Provident Fund (CPF)
Retirement Account, which bore interest at 4 per cent per annum, to
open an annuity account with NTUC Income in January last year. NTUC
Income would pay me a fixed monthly payment of $183.30 starting in
2009, when I reach 62 years of age.
No statement of account had been sent to me since the transfer was
effected.
After several requests by phone, NTUC Income replied in a letter
dated July 20, 2006, that the bonus for my account was $4.60 in
2004 and $5.20 in 2005.
Surprised to find out that the total bonus was so little, I sent a
further letter of enquiry on July 23 and received a phone call
from
the company two days later, providing me with the following
information:
NTUC Income paid no interest on the amount I had deposited.
The bonus, which is not guaranteed, would be based on the monthly
repayment of $183.30 and not on the total amount I had
deposited.
After calculating, I realised that, if I had retained the $37,000
with the CPF Board with the interest at 4 per cent per annum:
The yearly interest would be $1,480.
The total interest from 2005 to 2009 (when I reach 62 years of age
and monthly payment begins) would be $7,400.
The amount of $37,000 plus interest of $7,400 would be
$44,400.
The $44,400 would be enough for NTUC Income to pay a monthly amount
of $183.30 to me for up to about 20 years.
As the CPF Board will continue to pay interest on my balance after
2009, I would receive further interest year after year.
As it doesn't make sense for me to leave my money with the company,
I instructed NTUC Income on July 28 to transfer my funds back to
the CPF Board.
Lim Yan Beng>
[/b]
do you know that Lim Yan Beng was receiving ($183*12)/$37000 or
5.9% on his NTUC income annuities versus 4% from CPF
board?
