Commenting on the Central Provident Fund (CPF) Life annuity scheme, SMU Associate Professor of Finance (Education) Mandy Tham, whose research interests are in finance and wealth management, said that although the Special Account can be thought of as an investment account that earns returns from a floor interest rate, CPF Life is not an investment account but serves the purpose of ensuring our "minimum lifelong financial sustainability". She pointed out that CPF Life is designed to sustain one's lifestyle during their lifespan, but not to hedge against "mortality risk". "We are living longer and need a more adequate annuity plan. With a larger number of singles, bequest motives become weaker, lifelong retirement income needs become stronger," Assoc Prof Tham added.
