A few clients asked me about CPF Life. My father went to the CPF Board to get a quotation on the CPF Life. He was given a small piece of scrap paper indicating the estimated ranges of payout for the 4 different schemes. He asked me what I think. I told him not to put in any money unless the following is given to him:

a) The interest rate assumptions used (so that we can determine whether these assumptions are realistic or too optimistic).

b) Whether the lower limit of the range provided is guaranteed or it can go lower.

c) What is the death benefit of the different schemes in accordance to the age of death (you cannot make decision based on words like “low”, “medium” and “high” bequest payment).

d) What is the “surrender value” if the annuitant terminates the plan in the future.

The above should be provided based on a formal quotation and not verbal promises. Frankly speaking I seriously doubt CPF Board is able to provide a proper formal quotation like the Benefit Illustration required to be provided by insurance companies. My own dad was just given a scrap paper instead. It seems to me that CPF Board is about to manage the largest annuity scheme in Singapore and yet not appear to be subjected to the stringent requirement imposed by insurance companies. I appeal to all CPF members to insist on a proper documentation. Existing financial advisers should also restrain from advising unless the above formal documents are provided.