Asked on 04 Feb 2020
Im a fresh grad looking for high guaranteed retirement plan. What are the best policies out there that i can consider?
Firstly, consider if a retirement plan is something you'd like to have. All asset classes have their pros and cons.
If you are looking for a retirement plan, then you'll have to look at various factors which will determine what suits you. One of them is the guaranteed yield. A good retirement plan will have guaranteed yields in the region of 2.5+%. I've seen 2.61% guaranteed. Considering that these yields are guaranteed when the plan start, and that you will have bonuses credited over the years to the policy, by the time the payout starts, you will have a yield that will be higher than what was shown, which makes retirement plans a good complement to CPF LIFE.
(Note that retirement plans are meant to complement CPF LIFE, not replace it. CPF LIFE is the best annuity around, and you'd want that as a foundation for your retirement. If you work till retirement, I don't think there's an issue for you to meet the prevailing FRS. The question then becomes, where else can you get more guaranteed income, and that is where retirement plans come in)
Another factor you'll want to consider in a good plan is the fact that premiums can be waived upon TPD or CI, which means your plans will not be interrupted even if something happens to you. Contrast this to CPF, whereby if you don't work, you won't have contributions and cannot grow your SA/RA.
These are amongst the criteria that you'll want to consider when looking at a retirement plan. Now, because I don't know your current age or your desired age to retire, it will be hard to comment on which plan will suit you better. I do suggest you to have a chat with an independent financial advisor for more in-depth analysis so that you will have an idea of what may suit you, and get quotes that suit your particular situation.
05 Feb 2020
Wow, great that you are looking to plan for your retirement so quickly!
I personally... would rather you look at getting a savings plan because the commitment for a retirement plan might be pretty high in the beginning. Cause the concept of it is, taking a portion of your income now to pay you for your future. So if you are hoping to get 1k/ mth from the policy upon retirement, your premiums at the start might be the same amount, which be pretty high for someone who just started working.
Of course I do not know your situation and I might be wrong. But I do think a savings policy might be more affordable and also possible give you better returns upon maturity, and higher flexibility on how much you would like to withdraw
I suppose you mean "high guaranteed" as in high yielding, capital guaranteed?
so far i have not come across any insurer who can beat CPF SA of 4%, almost risk free.
on just a skim through the brochures, yields are pathetic at 2%, 2+%. which are even worse than CPF OA.
i will only take a retirement plan with an insurer because there is an additional benefit of premium waiver or disability income if any unforseen circumstances would to happen.
another thing which I do not like is the inflexibility of plans. besides manulife states there is an option for lifetime payout, the other two do not. if it is for retirement, i would want to receive payout until i move on, and not limited to 10, 20 years.
can i suggest you to speak to an adviser from https://www.sonylifefa.com/
they will analyse your situation with you and layout all the various plans and go through with you the pros and cons of each plan in relation to your needs.
disclaimer: I am not an adviser, not from sony life, i do not receive any remueration from them and have absolutely nothing to sell. i suggest because i find that sony life are the most transparent and is doing the right thing.