The top 10 countries with the highest life expectancy are:
Andorra 83.5
San Marino 8.16
Japan 81.2
Singapore 80.7
Australia, Switzerland, Sweden 80.4
Hong Kong 80.2
Canada, Iceland 80.1
Singapore ranked 4th in the world, just behind Japan.Andorra and San Marino are quite small countries.
This has implications on CPF Life. People are living longer. They need a life annuity to pay them an income for a lifetime.
WONDER WHAT IS THE HEALTH EXPECTANCY OF DIFFERENT COUNTRIES? I READ SOMEWHERE (QUITE A WHILE AGO) THAT THE GAP BETWEEN HEALTH EXPECTANCY AND LIFE EXPECTANCY IN JAPAN IS ABOUT 7 YEARS. AND THAT OF SINGAPORE IS MORE THAN 10 YEARS (I REMEMBERED SOMETHING LIKE 12 YEARS BUT NOT VERY SURE).
ReplyDeleteIf 80 is considered a life time, leaving your minimum sum with CPF and draw down without buying CPFLife or annuity is better .
ReplyDeleteIf everybody lives to 80-85 buying an annuity is not advantageous to you.
If life expectancy is 80.7 years, it could mean that many people, maybe 30% or more, will live beyond 80 years. That is a lot of people. According to this statistics, the difference in life expectancy between Singapore and Japan is now 0.5 years. We know that there are many old people in Japan, living beyond 100 years. Singapore will be quite close.
ReplyDeleteHi Mr. Tan,
ReplyDelete"If life expectancy is 80.7 years, it could mean that many people, maybe 30% or more, will live beyond 80 years."
This is inaccurate. Life expectancy is measure as the life expectancy at birth. This means that on average (arithmetic mean), a newborn in Singapore can expect to live till 80.7 years. So 50% of newborns will live longer than 80.7 years. If you are 60, this means that you will have a greater than 50% chance of living beyond 80.7 years, since the people who didn't make it to 60 (due to accidents, etc), and were making up the lower half of the 'life expectancy at birth of 80.7 years' simply aren't there anymore.
Anonymous 11:48 PM
ReplyDeleteYou are right that for someone who survived to age 60, the remaining life expectancy is more than 20.7 years.
I am not so sure about the distribution curve and if the actual proportion is more than 50% that you suggested. I make a more conservative estimate of 30% or more.
Anyway, life expectancy is increasing over the years, so this will make even more people living beyond age 80.
So, it is important to have a life annuity to provide an income for life.
Annuities insurance only looks good on paper, the payment sums are gradually worth almost nothing being eaten by inflation, esp in high cost Singapore. I believe San Marina and Andorra are countries that do not have astromical cost of living expenses as Singapore, where everything costs more every year.
ReplyDelete