From: LauZoeTay Jul-29 4:37 am
To: LauZoeTay (2 of 61)
17849.2 in reply to 17849.1
By the age of 80, the Government is estimated to have as much as $38,373 net profit. That is a HUGE profit for the Government! In fact, the net profit for the Government increases to a high of $45,723 by the time the member reaches age 83! Clearly if the CPF member passes away around the ages of 80-85, the Government stands to earn a LOT OF MONEY from the scheme! This is because the interest earned on RP fund is NOT given to the beneficiary but kept in the common pool upon the member¡¯s death.
As can also be seen from the table, the amount of money that left outstanding in the member¡¯s account rapidly diminishes after 80, so that by age 84, the beneficiary would get NOTHING in the event of demise of the member. However, the Government coffers still have a lot of cash. There is enough cash in the Government coffers to pay the member $610 per month for several more years while still maintaining profitability from the scheme. It is only AFTER the age of 90 that the Government starts losing money on the scheme.
This back-of-the-envelope calculation shows that even assuming the Government is right about half of CPF Life participants surviving to 85 years of age, the Government will clearly make a net profit from most members, given that comparatively fewer members will make it past 90 years of age.
It is therefore very fair to assume that the Government could perpetually generate large surpluses from the scheme, especially when we take into account the fact that premiums and monthly payouts will be altered in accordance with morality experience and the return of investments, thereby ensuring that the Government seldom goes into deficit in any particular year.
poor lauzoetay or should we say NGEJAY.....his blog bo sen li and must transform and degrade himself to lauzoetay to kekkek post to promote his lame prejudiced blog. what a loser!:oIo:
