I need some help. I am planning for my son's financial future! Should we go for endowment, annuity, POSB saver, medisave or all the combinations?

Hi Anon, sorry to hear about your situation. I'll be giving some calculations here for your consideration. I hope the calculations give you a better picture of your expectations.

What he needs:

• medical expenses coverage (saw on other comments he already has medical insurance, so this is one worry off the mind - just have to have enough cash to pay the premiums)

• rehab expenses $300/month

• daily expenses $1,000/month (covers your caregiving expenses and both your basic needs)

Total he needs: $1,300 monthly for life (excluding inflation in expenses)

What you and your wife need (please remember you need to plan for yourself and your wife, so both of you can have the option to stay home together while taking care of your son):

• retirement fund $2,000/month for both of you, simple retirement no fancy stuff, and since you're 56 now, you probably only need this after 4 to 6 years

Total both of you need: $2,000 monthly for life (excluding inflation in expenses)

What you have/ are going to have (in chronological order):

• $150k cash (is $150 a typo error in your question?) and $30k in CPF (hence total $180k mentioned in your question?)

• FD $50k 1y 1.75% = $50.8k

• FD $70k 5y 2.7% = $79.9k

• SSB $70k 10y 2.57% = $90.2k in 10 years

• $70k payout at 46yo (20 years from now)

Next is what's interesting is what your agents have proposed - PruWealth and Prime Reward 17+3. This combination of plan actually allows you to get money on a regular basis after 3 years. Prime Rewards 17+3 will pay out until 20 years, then PruWealth will take over to give some money annually for the rest of the life. For PruWealth, please go for single premium option if you have not already buy the plan.

Simply put, these two plans work well together to ensure a payout for your son for the rest of his life. Here's a timeline to illustrate how your money will flow:

Now:

• set aside $20,000 for first year expenses

• take up Prime Rewards 17 + 3 and PruWealth

Next year:

• use payout $50k from FD for Year 2 to Year 3 expenses

Year 4, 5 and 10:

• start leveraging on Prime Rewards at Year 4

• taking out $79.9k from your 5-year FD and $90.2k from your 10-year SSG Bond

Year 20:

• getting payout $70k from your son's policy

• start leveraging on PruWealth at Year 20

If you plan to go with your agents' suggestion, then you need to consider how much you like to leverage on both the plans proposed. You're lucky because you have $150k in savings and an FD payout after 1 year. What you need for 1 year is $1,300 x 12 months = $15,600. So you can use up to $130,000 in both plans. However, I doubt $130,000 would be sufficient so you'll need to use the payout from FD, SSG Bonds and your son's insurance to top up the balance.

For the top up, however, I'll suggest using more conservative tools, such as fixed deposits and banks with better savings interest, e.g. CIMB FastSaver and UOB Stash (offering about 1%p.a. to 1.5%p.a.). Insurance is better used for long term horizon 10 years. So you can leverage on insurance now for your son's future, and for the short to mid-term, use savings and bank facilities to meet your needs.

Quite complicated for execution if you are not around. Why?
If you and your wife are not around and probably your daughter will take care of your son. Is your daughter married now? If she is married and have her own commitement, will she be able to support the bro.
Highly suggest to do trust...
What type of plans are good for your son? Since he cant purchase anymore insurance.. And highly dependable on you.. Suggestion is buying a death coverage on yourself.
Lifetime annuity on your son. I teach you how to manage as all these are highly technical.