Earn 4% in your CPF special account

Dear Mr Tan,

If the Growth Policy can return between 3%-4% do you think it is wise to invest your CPF Special Account in this product?

The Special Account gives a guaranteed 4% without the risk and no need to hold to maturity.

I have one NTUC agent persuading me to invest my special account in the Growth POlicy. Trying hard to convince me about the insurance, which is actually a personal insurance stripped of all other benefits. I am amazed by her argument.

REPLY

It is better to keep your money in the Special Account to earn 4% per annum, rather than invest in the Growth policy, which is likely to pay a lower return. You can get your life insurance by buying a low cost term insurance.