Is 85 A Practical Withdrawal Age?

Source : TODAY, Friday, September 14, 2007

Many may not live long enough to receive annuities

Letter from RAYMOND LO WAN MOU

THE Government’s proposal to introduce compulsory annuity for all Central Provident Fund (CPF) members below the age of 55 is sound and good in principle.

I should know, because I currently get $306 a month from NTUC Income, having bought a $50,000 annuity six years ago, immediately after retirement.

The insurer will pay me a monthly sum plus a small yearly bonus until I die, which makes me feel secure and comfortable.

However, one drawback of the CPF’s compulsory annuity is the withdrawal age of 85. The average life expectancy of Singaporeans is now 80.

The Government expects that this will go up.

In spite of advances in medical science, I believe that many Singaporeans are still not convinced.

First, there is no research to show that the average life span will go up.

Second, we are living in a stressful society. With globalisation, the stress level will surely go up.

And stress could be a killer.

In fact, the World Health Organization estimates that 80 per cent of all illnesses are directly or indirectly caused by stress.

Third, the increasing pollution of air and contamination of food with excessive chemicals and preservatives are some of a number of factors which could affect our health and shorten our lives.

The recently-concluded Asia-Pacific Economic Cooperation summit gave no avowed commitment to stop the growth of global greenhouse gas emissions; just a non-binding “aspirational” goal.

China’s manufacturing and exporting of contaminated fresh and preserved food, vegetables, herbs, toothpastes and toys et cetera are also a serious source of concern to our health.

Last but not least, the threat of unknown infectious diseases and the constant mutation of viruses which could inflict death and misery can, with one strike, end our lives.

It is a fact that we are living in an ever dangerous and risky world, not to mention death caused by accidents and natural disasters.

Under such circumstances, it is difficult to believe that we can live up to an average of 85 years and above.

For the Government’s proposal to be meaningful, the withdrawal age for CPF annuitants should be lowered to about 75 years old.