New savings and protection plans from NTUC Income

NTUC Income has just launched two new insur­ance plans, Term­Life Solit­aire and Lim­ited Premium Revosave with bet­ter cov­er­age and lower premium, for insured up to 75 years old.

Term Insur­ance

Term­Life Solit­aire is a reg­u­lar premium term insur­ance that will cover the insured (age 74 last birth date or below) against Death and Ter­minal Ill­ness for at least $1 mil­lion, up to a max­imum age of 100 years old. The pro­tec­tion value is con­stant through­out the years of cov­er­age as it is not entitled to any bonus declared by NTUC Income. There is no cash value at any point in time since this is a pure pro­tec­tion plan. For sum assured of $1,500,000 and below, there is no med­ical exam­in­a­tion required!

There are 5 riders that can be added to this plan:-

  1. Dis­ab­il­ity Accel­er­ator – cov­ers Total and Per­man­ent Dis­ab­il­ity (TPD) before age 70 with min­imum sum assured of $1,000,000.
  2. Dread Dis­ease Accel­er­ator – cov­ers the 39 dread dis­eases with min­imum sum assured of $500,000.
  3. Dread Dis­ease Premium Waiver – waive future premium when poli­cy­holder is dia­gnosed with dread disease.
  4. Payor Premium Waiver – waive future premium when poli­cy­holder dies or is dia­gnosed with TPD.
  5. Enhanced Payor Premium Waiver — waive future premium when poli­cy­holder dies or is dia­gnosed with TPD or crit­ical illness.

 

Lim­ited Pay Revosave

Lim­ited Pay Revosave is a reg­u­lar sav­ings plan that provides a very good altern­at­ive to sav­ings in a bank. Not only it offers bet­ter interest rate, it provides pro­tec­tion against death, Total per­man­ent Dis­ab­il­ity (Lost of sight, two legs etc.) regard­less of your cur­rent health. It is 100% guar­an­tee to be accep­ted. You will be covered for 105% of the premium paid through­out the cov­er­age! If it is acci­dental death or TPD before age 70, an addi­tional 100% of the sum assured on top of the death/TPD bene­fit will be paid out too. You are eli­gible to apply if you are 75 years old and below.

This is how Lim­ited Pay Revosave works.

1) You save a fixed sum of money to NTUC Income for 3,5,10 or 15 years.

2) At the end of second year, NTUC Income will return part of the premium back (5% of the sum assured called cash­back) to you. You can choose to a) Spend it. b) Save with us at cur­rent 3.5% per annum interest in deposit account issued by Income

3) At any point in time, you can with­draw the money from the Deposit account.

4) The policy will end at the chosen policy term of 10, 15,20 or 25 years. All matur­ity pro­ceeds will be paid out, together with the cash­back and interest earned in the deposit account.

NTUC Income New Asian Bond Fund with monthly payout features

NTUC Income has launched a new fund, Asian Bond Fund that intends to dis­trib­ute monthly dividend pay­out of 4.5%-5.5% per annum.

The Asian Bond Fund aims to provide a medium to long-term rate of return by invest­ing mainly in Asian Fixed Income Secur­it­ies. The sub-fund is inves­ted in the Black­Rock Global Funds– Asian Tiger Bond Fund A6 SGD Hedged Share Class (the under­ly­ing fund).

The under­ly­ing fund will invest at least 70% of its total assets in the fixed income trans­fer­able secur­it­ies of issuers dom­i­ciled in, or exer­cising the pre­dom­in­ant part of their eco­nomic activ­ity in, Asian Tiger coun­tries (i.e. South Korea, the People’s Repub­lic of China, Taiwan, Hong Kong, the Phil­ip­pines, Thai­l­and, Malay­sia, Singa­pore, Viet­nam, Cam­bodia, Laos, Myan­mar, Indone­sia, Macau, India and Pakistan). The under­ly­ing fund may also invest in the full spec­trum of avail­able secur­it­ies, includ­ing non-investment grade. It may use fin­an­cial deriv­at­ive instru­ments for effi­cient port­fo­lio man­age­ment or to hedge mar­ket, interest rate and cur­rency risk.

The sub-fund offers a monthly pay­out fea­ture and intends to provide a monthly dis­tri­bu­tion with effect from 27 May 2016. The Man­ager intends to pay the dis­tri­bu­tion within 45 days from the declar­a­tion date. The declar­a­tion date is set on the 3rd last busi­ness day of every month. The declar­a­tion date is sub­ject to review and the Man­ager has the sole dis­cre­tion to determ­ine the rate and fre­quency of the dis­tri­bu­tion. Dis­tri­bu­tions are not guar­an­teed and can be made out of income, cap­ital gains, and/or cap­ital of the sub-fund.

More import­antly, NTUC Income will guar­an­tee 105% of the invest­ment amount or cash value, whichever is higher, in the event of untimely death or Total Per­man­ent Dis­ab­il­ity (TPD before age 70) before age 65. After age 65, it is 100% of the invest­ment amount or cash value, whichever is higher, in the event of untimely death. This is on top of the monthly with­drawal of the dividends over the years.

The min­imum single premium to invest is $10,000.

Fund Man­ager: NTUC Income

Sub-Investment Man­ager: Black­Rock (Lux­em­bourg) S.A.

Ini­tial Sales Charge: 3% (For single premium and top-up)

Annual Man­age­ment Fee: 1% p.a.

Annual Policy Fee from 2nd year onwards: $50, waive if invest­ment amount is $25,000 and above.

For example, below is the hypo­thet­ical illus­tra­tion of how the dividend will be calculated.

Invest­ment $100,000
Offer Price $1
Num­ber of units $100,000/$1 = 100,000
Dividend Rate $0.004053 per unit
Dividend pay­able 100,000*0.004053 = $405.30

Sub­scrip­tion Method: Cash/SRS

Asian Bond Fund Factsheet is here at http://www.income.com.sg/fund/pdf/2016/asianbond(may).pdf

Asian Bond Fund Product High­light Sheet is here at http://www.income.com.sg/fund/phs/2016/asianbond(dec).pdf

NTUC Income #StartRetiring Consumer Promotion

NTUC Income has launched “#StartRe­tir­ing Con­sumer Pro­mo­tion” from 1 April 2016 to 31 May 2016.

Cus­tom­ers who suc­cess­fully sub­mit their Reg­u­lar Premium Life Policies includ­ing any applic­able rider(s) between 1 April and 31 May 2016 (inclus­ive of both dates), and their policies issued not later than 31 July 2016, will be entitled to a gift as set out in the rel­ev­ant tiers below.

Min­imum monthly premium Premium pay­ment term of 10 years and above Premium pay­ment term of 5 to 9 years Premium pay­ment term of 3 to 4 years
$1,800 Cap­ita­Voucher

$1650

Cap­ita­Voucher

$800

Cap­ita­Voucher

$450

$1,200 Cap­ita­Voucher

$750

Cap­ita­Voucher

$350

PHILIPS Air Pur­i­fier worth $279
$500 Cap­ita­Voucher

$250

PHILIPS Slow Juicer worth $229 N.A.
$250 Cap­ita­Voucher

$50

N.A. N.A.

 

The qual­i­fy­ing policies are as follows:

  1. LIMITED PAY REVOSAVE (3-PAY-10)
  2. LIMITED PAY REVOSAVE (5-PAY-10)
  3. REVOSAVE
  4. LIMITED PAY REVOSAVE
  5. CANCER PROTECT
  6. VIVOCHILD
  7. ENDOWMENT
  8. VIVOCARE 100
  9. FAMILY INSURANCE PLAN
  10. REVOSECURE
  11. VIVOLIFE 125/180/350
  12. MORTGAGE PROTECTION PLAN
  13. PROTECTION
  14. LIMITED PREMIUM PROTECTION
  15. FLEXRETIRE
  16. SENIOR PLAN
  17. DREAMSAVER
  18. SILVER PROTECT
  19. ITERM
  20. VIVOLINK
  21. VIVOCASH

Terms and Con­di­tions can be found at http://www.income.com.sg/promotions/life-insurance/start-retiring-promotion#main

Update on tax on Supplementary Retirement Scheme withdrawal

Cur­rently, an SRS mem­ber can with­draw up to $40,000 per year from his SRS account tax-free on or after reach­ing the pre­scribed retire­ment age, assum­ing that he has no other tax­able income. Over the max­imum with­drawal period of 10 years, he can with­draw up to $400,000 tax-free.
How­ever, if an SRS mem­ber passes away before com­plet­ing his SRS with­draw­als or made a full with­drawal on the grounds of ter­minal ill­ness, he would not be able to enjoy the full bene­fit from spread­ing out his SRS with­draw­als over a 10-year period. Hence, from year of assess­ment 2016, a tax exemp­tion of up to $400,000 would be gran­ted for SRS funds deemed with­drawn upon an SRS member’s demise or a with­drawn in full on the grounds of ter­minal ill­ness.

Next, from July 2015, SRS mem­bers will be able to apply to their SRS oper­at­ors to with­draw an SRS invest­ment by trans­fer­ring the invest­ment out of their SRS accounts (e.g. into their per­sonal Cent­ral Depos­it­ory (CDP) account), without hav­ing to liquid­ate their SRS invest­ments. This is only applic­able for the fol­low­ing types of with­draw­als, which qual­ify for the 50% tax concession:

  1. with­drawal on or after the stat­utory retire­ment age pre­vail­ing at the time of an SRS member’s first con­tri­bu­tion (cur­rently age 62);
  2. with­drawal on med­ical grounds;
  3. with­drawal in full by a for­eigner who has main­tained his SRS account for at least 10 years from the date of his first con­tri­bu­tion; and
  4. actual with­drawal made by an SRS mem­ber or his legal per­sonal rep­res­ent­at­ive (if he is deceased) from his SRS account, after the SRS invest­ment that is to be with­drawn had earlier been deemed with­drawn upon death or after the expiry of the 10-year with­drawal period.

All other with­draw­als from an SRS account, includ­ing pre­ma­ture with­draw­als, must be made in cash.

Changes of CPF in 2016

CPF CELING
CPF con­tri­bu­tion ceil­ing will be increased from $5000 to $6000 with effect from 1 Jan 2016. This will help to boost another $170 from employer and $200 from employee for those earn­ing more than $6000 monthly salary and below 55 years old. Though the take-home pay for these employ­ees will reduce by $200, the sav­ings for retire­ment will be boos­ted by these extra savings.

CPF CONTRIBUTION RATE
The CPF con­tri­bu­tion rate for employee 50 years and above will be increased from 1 Janu­ary 2016.

  • Above 50 to 55, employer CPF rate will be increased from 16% to 17%, while employee CPF rate will be increased from 19% to 20%;
  • Above 55 to 60, employer CPF rate will be increased from 12% to 13%, with no change to the cur­rent employee CPF rate of 13%;
  • Above 60 to 65, employer CPF rate will be increased from 8.5% to 9%, with no change to the cur­rent employee CPF rate of 7.5%.

In addi­tion, for CPF mem­bers aged 55 and above from 1 Janu­ary 2016, the first $30,000 from the CPF accounts will earn extra 1% per annum, on top of the cur­rent 1% extra interest on the first $60,000 of their total CPF sav­ings. That is,

 

 

Total CPF balance

Interest Rate
If in Special/Retirement/Medisave Accounts If in Ordin­ary Account
First $30,000 6% 4.5%
Next $30,000 5% 3.5%
Remain­ing bal­ance above $60,000 4% 2.5%

This trans­lates to extra $300 sav­ings per year for the next 10 years before CPF Life pay­out starts at 65. Assum­ing the yearly $300 interest earned goes into the Retire­ment Account which earns 4% interest, this trans­lates to $3,745 after 10 years. With higher amount in CPF Retire­ment Account, CPF mem­bers can expect higher pay­out from their CPF Life.

SUPPLEMENTARY RETIREMENT SCHEME
The caps on con­tri­bu­tion to the vol­un­tary retire­ment sav­ings scheme, Sup­ple­ment­ary Retire­ment Scheme (SRS) will be increased from 1 Janu­ary 2016. For Singa­por­ean and Per­man­ent Res­id­ent, the cap will be increased from $12,750 to $15,300. The cap for for­eigner will be increased from $29,750 to $35,700. This will help to increase the per­sonal income tax sav­ings, as the amount put into SRS will enjoy tax relief. Moreover, retire­ment cash­flow will be improved when SRS money is allowed to be with­drawn without pen­alty from age 62 onwards.

First Singapore Savings Bond

The first Singa­pore bond was opened for applic­a­tion on 1st Septem­ber 2015 and will close on 25 Septem­ber 2015, 9pm. The total amount for this alloc­a­tion is $1.2 billion.

You can apply in mul­tiples of $500 up to $50,000 through DBS/POSB, OCBC or UOB ATMs, or through DBS/POSB’s Inter­net Bank­ing portal. You will also need to have the indi­vidual CDP Secur­it­ies account linked to any of your bank accounts as CDP is the cus­todian for Sav­ings Bonds and it will pro­cess the applic­a­tions, interest pay­ments and redemp­tions. You may visit CDP’s webpage for inform­a­tion on open­ing your CDP Secur­it­ies account.

The alloc­a­tion will be con­duc­ted on 28th Septem­ber 2015 and the bonds will be issued on 1 Octo­ber 2015. The interest will be paid on 1st April and 1st Octo­ber every year till matur­ity date on 1 Octo­ber 2025. The interest for 1st year is 0.96% p.a., and 1.09% p.a. on second year. It will increases to 3.70% p.a. on the 10th year. So if you hold for 10 years till matur­ity, the com­poun­ded interest rate is 2.63%p.a.

Singa­pore Gov­ern­ment will issue the Singa­pore Sav­ings Bond every month. The applic­a­tion period is always 1st of the month till the 4th last busi­ness day of the month. Alloc­a­tion of the bonds will be con­duc­ted on the 3rd last busi­ness day of the month and res­ults will be pub­lished on its web­site after 3pm. Should the total amount of applic­a­tions exceed the amount on offer in a par­tic­u­lar month, you may not get the full amount you applied for. The excess cash will be refun­ded to you by the end of the 2nd last busi­ness day of the month. Sav­ings Bonds will be issued on the 1st busi­ness day of the fol­low­ing month. You will be noti­fied by CDP via mail of the amount of Sav­ings Bonds allot­ted to you. You can also check your hold­ings online through the CDP Inter­net ser­vice or by call­ing CDP at 6535–7511. The total amount of Sav­ings Bonds held across all issues can­not be more than $100,000.

You will receive the first interest pay­ment 6 months after the bond is issued. Interest will be auto­mat­ic­ally paid into the bank account that is linked to your CDP account. Interest will be paid every six months after that, on the 1st busi­ness day of the month. The interest pay­ments will be reflec­ted in your CDP statements.

There is a $2 trans­ac­tion fee for any trans­ac­tion such as applic­a­tion and redemp­tion of the bond.

You can redeem in mul­tiples of $500 on the 1st busi­ness day of each month till the 4th last busi­ness days of the month without pen­alty. Redemp­tion pro­ceeds will be paid by the end of the 2nd busi­ness day of the fol­low­ing month. If you redeem before the sched­uled interest is paid, you will receive a pro-rated amount, which is the interest you have earned but have not been paid.

Launch of Global Income Fund from NTUC Income

NTUC Income has just launched a new fund, Global Income Fund that intends to dis­trib­ute monthly dividend pay­out of 4–5% per annum.

The Global Income Fund aims to provide income and cap­ital growth over the medium to longer term by invest­ing primar­ily in global equit­ies and global fixed income secur­it­ies dir­ectly or indir­ectly through the use of Invest­ment Funds or fin­an­cial deriv­at­ive instru­ments (includ­ing, but not lim­ited to, futures, options and credit default swaps). The under­ly­ing Fund is act­ively man­aged between asset classes, allow­ing it to achieve the object­ive of achiev­ing yield and max­im­iz­ing total returns dur­ing all phases of the eco­nomic cycle.

The sub-fund aims to provide a sus­tain­able level of income. It invests in a broad range of assets from around the world, and seeks to identify attract­ive sources of income whilst diver­si­fy­ing risk. The sub-fund intends to achieve this object­ive by invest­ing all or sub­stan­tially all of its assets in Sch­roder Inter­na­tional Selec­tion Fund Global Multi-Asset Income which is man­aged by Sch­roder Invest­ment Man­age­ment Limited.

More import­antly, NTUC Income will guar­an­tee 105% of the invest­ment amount or cash value, whichever is higher, in the event of untimely death or Total Per­man­ent Dis­ab­il­ity (TPD) before age 65. After age 65, it is 100% of the invest­ment amount or cash value, whichever is higher, in the event of untimely death.  This is on top of the monthly with­drawal of the dividends over the years.

The Cur­rent Pro­mo­tion offers a 10% bonus on the net amount of the new dis­tri­bu­tion declared for Global Income Fund and will be given each month, up to 22 Septem­ber 2015. This bonus is only pay­able once for each dis­tri­bu­tion arising from net new invest­ments and top-ups. It is not applic­able to monthly dis­tri­bu­tion arising from switches into this fund. The declar­a­tion of the dividend rate will be announced on the fourth Tues­day of the month, start­ing from 28 April 2015. NTUC Income will pay or re-invest the dis­tri­bu­tion within 45 days from the declar­a­tion date.

The min­imum single premium to invest is $10,000.

For example, if Mr Lee invests in Global Income Fund and gets a monthly dis­tri­bu­tion of $500 per month. The 10% bonus pay­able for each dis­tri­bu­tion is $50 dur­ing this pro­mo­tion period as shown below:

Declar­a­tion Date in 2015 28 April 26 May 23 June 28 July 25 August 22 Septem­ber
Monthly Dis­tri­bu­tion $500 $500 $500 $500 $500 $500
10% Bonus $50 $50 $50 $50 $50 $50

The extra bonus pay­able based on the above example is $300.

Sub­scrip­tion Method: Cash/SRS

Global Income Fund Factsheet is here at http://www.income.com.sg/fund/pdf/2015/globalincome(jan).pdf

Global Income Fund Product High­light Sheet is here at http://www.income.com.sg/fund/phs/2014/globalincome(jun).pdf

New NTUC Income Retirement Plan – FlexRetire

About FlexRe­tire

FlexRe­tire is a reg­u­lar premium par­ti­cip­at­ing endow­ment plan. It allows you to start sav­ings reg­u­larly now for your planned retire­ment age of 55, 60, 65 or 70 Last Birth Date (LBD). Upon retire­ment, you will receive reg­u­lar retire­ment pay­out for the next 10, 20 or 30 years. You will also enjoy free pro­tec­tion of 105% premium paid-to-date plus 100% of the bonuses against death and Total Per­man­ent. Dis­ab­il­ity. FlexRe­tire is guar­an­teed accept­ance, i.e. any­one can pur­chase the plan without the needs for a med­ical check-up.

FlexRe­tire is divided into 2 phases — Accu­mu­la­tion Period and Pay­out Period.

Accu­mu­la­tion Period = Chosen Retire­ment Age (up to age 55/60/65/70 LBD) – Entry Age (LBD)

Pay­out Period = Choice of 10, 20 or 30 years

Dur­ing the Accu­mu­la­tion Period, you can choose to pay the premium in 5 years, 10 years or Accu­mu­la­tion Period minus five years. That is, if the Accu­mu­la­tion Period is 25 years, you only need to pay for 20 years and start get­ting the reg­u­lar pay­out from the 25th year onwards.

At the end of Accu­mu­la­tion Period, you can choose to

  • with­draw the full matur­ity amount;
  • with­draw par­tial matur­ity amount, rede­posit the
    remain­ing cash (at least $10,000) with Income and receive monthly pay­out for the next 10/20/30 years; or
  • save the full matur­ity amount with Income with addi­tional cash value given and receive monthly pay­out for the next 10/20/30 years.

Dur­ing the Pay­out Period when you are receiv­ing the monthly pay­out, you can choose to:

  • use the pay­out as your monthly retire­ment income; or
  • deposit the pay­out with NTUC Income at the cur­rent interest rate of 3.5% p.a.. This is a deposit
    account and you can with­draw the money anytime.

At the end of the Pay­out Period, you will receive

  • the final monthly payout;
  • Future Gift, pro­jec­ted at 24 times of the final monthly pay­out; and
  • the reg­u­lar depos­ited pay­ment accu­mu­lated with NTUC Income and accu­mu­lated interest, if any.

The min­imum entry age is 20 and last entry age is 60 LBD.

 

How FlexRe­tire Lets You Retire the Way You Want?

Sup­pose you are now 35-year-old and desire a monthly retire­ment
income of at least $1,000 for 20 years when you retire at age 65. You can start build­ing your retire­ment funds through FlexRe­tire plan as follows:

Monthly Premium Yearly Premium Total Premium Paid for 10 years Guar­an­teed Matur­ity Amount at 65 years old Bonus upon matur­ity @ 4.75% IRR* Total Matur­ity Amount at 65 years old
$1082.10 $12,485 $124,850 $124,850 $75,796 $200,646

If the full matur­ity amount is re-deposited with NTUC Income at the end of Accu­mu­la­tion Period,

New Prin­cipal Amount Pro­jec­ted Monthly Pay­ment @4.75% IRR* for 20 years Pro­jec­ted Future Gift Total Amount drawn over 20 years, includ­ing Future Gift
$454,704 $2,216 $53,184 $585,024

*IRR : Invest­ment Rate of Returns

An Illustration for FlexRetire Plan

Illus­tra­tion for FlexRe­tire Plan