Assumption:
a) You are now 65 years old
b) You can buy a life annuity to pay $600 a month. But this is a flat annuity.
c) You can buy an annuity that increases by 2% every year to cover inflation. However, your starting annuity is $500 a month.
d) Both annuity yield 4% p.a.
e) You are in good health and you do not need to leave a legacy for your children - or maybe you provided for them separately.
Which annuity do you choose?
a) You are now 65 years old
b) You can buy a life annuity to pay $600 a month. But this is a flat annuity.
c) You can buy an annuity that increases by 2% every year to cover inflation. However, your starting annuity is $500 a month.
d) Both annuity yield 4% p.a.
e) You are in good health and you do not need to leave a legacy for your children - or maybe you provided for them separately.
Which annuity do you choose?
1 comment:
In this example of course I'll choose increasing.
However for CPF Life version, they are very conservative and will start much lower than $500.
Post a Comment