An alternative to annuities, longer CPF payouts would mean she can get late husband’s share
Letter from GOH KIAN HUATINSTEAD of having Central Provident Fund members subscribe to the annuity plan, I suggest the Government explore other alternatives.
The current minimum sum that must be maintained in the CPF account until members reach the drawdown age of 67 will be gradually increased to $120,000. Members can expect to receive a monthly payout between the ages of 67 and 85.
As an alternative to compulsory annuity, I suggest the the monthly payouts be reduced but their duration be extended to age 90 or 95.
To increase the monthly payout, the minimum sum may also be increased to say, $150,000, progressively.
In this way, if CPF members die early, they can have their wish of passing the estate on to their beneficiaries.
Additionally, the proposed annuity plan does not address the financial needs of housewives with little or no CPF contribution.
They are unable to enjoy the monthly CPF payout during their old age and have no funds to purchase the compulsory annuity.
To make matters worse, women generally live longer than men. Thus, these women may face financial problems if their spouse or children do not support them.
Under the compulsory annuity plan, housewives would not be able to enjoy any benefits if their spouses, who are CPF annuitants, die early.
However, under my proposal, housewives could continue to receive the monthly payouts remaining in their spouses’ account even if they were to live till the age of 90 or 95.
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