Source: CPF

When it comes to choosing a CPF LIFE plan, many Singaporeans automatically go for the Standard Plan because it promises higher monthly payouts. In fact, the standard plan is the default plan if you don’t do anything. But if I had to choose today, I’d go with the CPF LIFE Basic Plan — and here’s why.

1. The Basic Plan Leaves More for My Loved Ones

The key difference between CPF LIFE Basic and Standard boils down to how the premiums are used. Under the Standard Plan, more of your Retirement Account (RA) savings go into the CPF LIFE annuity pool earlier on, which gives you higher payouts — but at the expense of your bequest. With the Basic Plan, only about 10-20% of your RA savings are deducted upfront to fund the annuity. The rest stays in your RA and continues earning interest. When you pass on, whatever’s left (including the interest) gets returned to your loved ones....