I believe that CPF Life is good for the people. Here are my reasons:
a)It is operated as a mutual scheme. The future payment will reflect the investment yield and mortality experience.
b) The administrative expense is low
c) Most people (except the affluent) will receive a bonus when they join the scheme
d) The interest rate credited to the investments is higher than the market rates.
e) CPF or the Government will not make any profit from the scheme.
Members who buy CPF Life is getting a good deal, much better than any life annuity that can be offered by an insurance company. The view held by some people, that the Government is trying to make money from CPF Life is unfounded.
The non-guaranteed nature of the monthly payout will work better for the members. If there is high inflation in the future, it is likely that a higher payount will be made under CPF Life (as inflation is usually accompanied by higher interest rate).
I hope that readers of my blog will listen to my positive views on CPF Life and not be influenced by the negative views and the distrust.
Tan Kin Lian
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