Savings plans in Singapore: frequently asked questions

An endowment plan is a life insurance policy that pays a lump sum at maturity, or on earlier death, rather than a bank deposit. MoneySense cautions that endowments are sometimes sold as if they were fixed deposits. The differences are structural: an endowment usually runs for a fixed term such as 10, 15 or 20 years, part of the payout in a participating plan is not guaranteed, and early termination may result in losses because the surrender value in the first years is often below premiums paid. A Singapore-dollar fixed deposit at a member bank is covered by deposit insurance up to S$100,000 per depositor per bank (SDIC); an endowment is instead covered by the Policy Owners' Protection (PPF) Scheme, only for guaranteed benefits and within caps. See How endowment plans work.

A participating (par) plan shares in the profits of the insurer's participating fund through bonuses; a non-participating (non-par) plan pays only the guaranteed amounts written into the contract. MoneySense describes par policies as policies that "participate or share in the profits" of the par fund, while non-par endowments offer "guaranteed maturity and cash values". The trade-off is that par plans have a guaranteed layer plus a non-guaranteed layer that depends on fund performance, expenses and claims experience, whereas non-par plans give certainty but no upside. According to LIA's 2025 full-year results (11 February 2026), par products made up 24% of weighted new business premiums and non-par products 32%.

No, bonuses are not guaranteed until they are declared, and future bonus rates can be cut. MoneySense states that "bonuses and cash dividends are non-guaranteed benefits until they have been declared". Once a reversionary bonus is declared and added to the policy, the LIA/MoneySENSE participating policy guide says the insurer "cannot subsequently reduce" it — but if you surrender, only a proportion of reversionary bonuses may be paid out. Terminal bonuses are only calculated on maturity, claim or surrender, so they remain at risk until then. Bonus declarations are approved by the insurer's board, taking the appointed actuary's advice into account, and are usually smoothed over time.

It usually means the guaranteed surrender value at a stated policy year — often at or near maturity — is not less than the total premiums paid, subject to the policy terms. Typical conditions include no alterations, no partial surrenders and no missed premiums. It does not mean every year is protected: surrendering before that stated year can still return less than you paid. It also does not make the plan a deposit. Under the PPF Scheme, the guaranteed part of the surrender value is covered within the caps, currently S$100,000 aggregated guaranteed surrender value per life assured per insurer (SDIC), while any non-guaranteed amount is not. Read the product summary for the exact year and conditions.

An annuity converts a premium into regular payments for a fixed period or for life; a retirement income plan is a marketing label for a policy that first accumulates value and then pays an income stream, often structured as a deferred annuity or an endowment with a payout phase. MoneySense defines an annuity as a policy that "typically guarantees fixed payments at regular intervals (usually monthly)". The practical questions are the same for both: when payouts start, how long they last, which part is guaranteed, what happens on death or surrender, and whether the policy has a loan facility. See Annuities in Singapore and Retirement income plans.

The insurance element in a savings plan is usually small — often a death benefit roughly equal to premiums paid or the surrender value — so it rarely replaces dedicated protection such as term or whole life cover. Its main role is to make the product a life policy and to pay out if the life assured dies before maturity. MoneySense recommends comparing a bundled product against a term product, which is why a bundled product disclosure accompanies the illustration. If your main need is protection, compare term insurance separately; if your main need is savings, focus on guaranteed values, liquidity and the comparison with deposits, T-bills and Singapore Savings Bonds.

They are the two illustrated investment rates of return used to project non-guaranteed values in Singapore-dollar participating policies, not forecasts or limits. Since 1 July 2021, LIA has capped the upper illustration rate at 4.25% per annum and the resulting lower rate at 3.00%, and reviews the caps annually. LIA states the rates are "used purely for illustrative purposes and do not represent upper and lower limits" on fund performance. Actual bonuses could be higher or lower than either projection. Treat the two columns as a sensitivity range and rely on the guaranteed column for anything you need with certainty. See How to read a benefit illustration.

"Effect of Deductions" shows how much of the value of your premiums is absorbed by charges up to each policy year. LIA's published illustration format sets out three columns: Value of Premiums Paid To-date, Effect of Deductions To-date and Total Surrender Value. Deductions include the cost of insurance, distribution cost, expenses, any surrender charge, expected tax and, for participating policies, expected transfers to shareholders. The figure is calculated at the illustration rate, so it is itself an estimate. A large effect of deductions in early years is the main reason early surrender returns less than premiums paid.

No. LIA's illustration format states that the Total Distribution Cost "is not an additional cost to you; it has already been allowed for in calculating your premium". It shows how much of your premium is expected to go towards the cost of distributing the policy, over the period stated in the illustration. It is useful as a transparency measure rather than as a separate bill. When comparing two plans, a higher distribution cost relative to premium is one of the factors that can lower surrender values, especially in early policy years.

Compare the "Total Premiums Paid To-date" column with the surrender value column, year by year. The first year in which the guaranteed surrender value equals or exceeds total premiums paid is the guaranteed break-even year; the first year in which the total (guaranteed plus non-guaranteed) surrender value does so at the 3.00% or 4.25% rate is the illustrated break-even year. The guaranteed break-even year is the one that does not depend on future bonuses. If the guaranteed surrender value never reaches premiums paid during the term, the plan relies on non-guaranteed bonuses to return your capital.

Look at the product summary before buying and the annual bonus update after buying. Under MAS Notice 320, product summaries for participating policies must disclose the par fund's investment objective and strategy, current asset mix, net investment returns for the past three years and the three-, five- and ten-year averages, total expense ratios for the past three years, the smoothing approach and recent bonus rates for the plan. Insurers also publish yearly par fund updates on their websites. Past fund returns are not indicative of future bonuses, and figures from different insurers are not directly comparable without checking currency and asset mix.

Partly. The benefit illustration still separates guaranteed and non-guaranteed values and still discloses deductions and distribution cost, but the 4.25% and 3.00% caps on LIA's public page are stated for Singapore-dollar participating policies. For a US-dollar plan, read the illustration rates stated in the illustration itself rather than assuming the SGD caps. A USD plan also adds currency risk if your spending is in Singapore dollars: a favourable illustrated return can be offset by exchange-rate movements. See Savings plans for foreigners and new PRs.

Yes, CPF LIFE is a life annuity. MoneySense states "CPF LIFE is a life annuity", and CPF Board describes it as a national longevity insurance annuity scheme paying monthly income for life, with CPF LIFE savings "guaranteed by the Singapore Government". Whether a private annuity is useful depends on your income gap after CPF LIFE, other assets, health and need for bequests or flexibility. A private annuity is backed by the insurer, with PPF protection only for guaranteed benefits up to a S$100,000 aggregated commuted value per life per insurer (SDIC). It complements CPF LIFE rather than replacing it. See CPF LIFE vs private annuities.

For members turning 55 in 2026, CPF Board lists the Basic Retirement Sum at S$110,200, the Full Retirement Sum at S$220,400 and the Enhanced Retirement Sum at S$440,800. Its estimated monthly payouts from age 65 are about S$950, S$1,780 and S$3,440 respectively, for a male member on the CPF LIFE Standard Plan, assuming savings in the Retirement Account grow with CPF interest of up to 6% per annum until 65 (CPF Board, page updated 16 June 2026). CPF Board says payouts increase by up to 7% for each year you defer, up to age 70. These are estimates, not quotations.

Only within the CPF Investment Scheme (CPFIS) rules. CPF Board's CPFIS Annex A allows annuities and endowment policies offered by insurers included under CPFIS, where the life insured is the member, and only single-premium or recurring single-premium policies; new regular-premium policies have not been allowed since 1 January 2001. An endowment must mature no later than the member's 62nd birthday or the prescribed minimum retirement age, whichever is later, and CPFIS investments cannot be assigned or pledged. You can invest Ordinary Account savings above S$20,000 and Special Account savings above S$40,000, and new investors must complete the Self-Awareness Questionnaire. See CPF and savings plans.

From January 2025, CPF closed the Special Account (SA) for members aged 55 and above. According to CPF Board, SA savings were transferred to the Retirement Account up to the member's cohort Full Retirement Sum, and any balance went to the Ordinary Account. The same 2025 changes raised the Enhanced Retirement Sum from three to four times the Basic Retirement Sum. For savings plan decisions, the effect is that money previously earning the SA rate may now sit in the OA, whose interest rate (2.5% floor for October–December 2026, CPF Board) is lower than the 4% floor on Special, MediSave and Retirement Account monies, which the Government has extended to 31 December 2027.

It depends on whether you have set aside the Full Retirement Sum. CPF Board states that between 55 and 64, if you have set aside your FRS, "you can withdraw any amount from your Ordinary Account"; if not, you can withdraw S$5,000 from your OA, and remaining OA savings may be transferred to your Retirement Account. From 65 you can withdraw an additional amount of your retirement savings, generally excluding cash top-ups, CPF transfers and government grants. Rules and amounts are set by CPF Board and can change, so check your own CPF statement before planning to move withdrawn money into a savings plan.

Generally no. MoneySense states "You cannot take a loan against annuity policies", and that surrendering an annuity early may result in losses. This is different from many endowments, where a policy loan may be available against the cash value — though MoneySense cautions that "the interest charges can be steep" and an unpaid loan reduces what you eventually receive. If liquidity before or during the payout phase matters to you, check the surrender terms, any partial withdrawal options and the death benefit in the product summary before committing a large single premium to an annuity.

Yes, if the product accepts SRS funds and meets the rules. MOF's SRS FAQ booklet (as of December 2017) states that only single-premium products are allowed, including recurrent single-premium annuity and non-annuity plans, and that the decision to accept SRS monies generally lies with the product provider. Critical illness, health and long-term care products are excluded. MOF statistics show insurance made up 20% of SRS investment portfolios at December 2025, down from 26% at December 2021. Because the booklet is dated, confirm current eligibility with your SRS operator (DBS, OCBC or UOB) and the insurer. See Using SRS for endowments and annuities.

Because SRS is designed for retirement savings, not protection. MOF's SRS FAQ booklet (December 2017) states that life cover, including total and permanent disability benefits, "will be capped at 3 times the single premium". The cap keeps the insurance element small relative to the savings element, so that SRS tax relief mainly supports retirement accumulation. In practice, an SRS endowment or annuity will carry modest death cover, and anyone needing substantial protection would look at policies funded outside SRS. Trust nominations are also not allowed on life policies bought with SRS funds; a revocable nomination may be possible.

Back into your SRS account while it remains open. MOF's SRS FAQ booklet (December 2017) states that cash proceeds on maturity "would generally have to be returned to the SRS account", and that monthly annuity payouts "must be returned to the SRS account before you withdraw them". Tax is then applied when money is withdrawn from SRS, not when it is credited. The SRS operator reports taxable withdrawals to IRAS, so you do not declare SRS annuity income separately. Check your operator's current procedure, because the routing of payouts is an operational matter between the insurer and the bank.

Because a life annuity pays for as long as you live, the normal 10-year withdrawal window cannot apply. IRAS states that penalty-free withdrawals made on or after the statutory retirement age prevailing at your first contribution (64 from 1 July 2026) can be spread over 10 years, with 50% of each withdrawal taxable. For life annuities, "the 10-year withdrawal period does not apply": so long as you keep receiving annuity payments for life, 50% of each year's payments is taxable. This allows SRS money to be turned into lifelong income while keeping the 50% concession. Tax outcomes depend on your total income each year.

It is treated as withdrawn at the end of the window even though you have not surrendered it. IRAS states that at the end of the 10-year period, insurance policies "such as endowment policies and term annuities" need not be surrendered, but their surrender value is deemed withdrawn and 50% of it is taxed. The SRS operator reports this to IRAS and it is assessed in the following year. Planning point: check that an SRS endowment's maturity date falls inside your expected withdrawal window, or be prepared for tax on its surrender value at that point while the actual maturity proceeds arrive later.

The annual contribution cap is S$15,300 for Singapore citizens and PRs and S$35,700 for foreigners (MOF), and contributions qualify for tax relief within the overall personal relief cap of S$80,000 per Year of Assessment. Investment returns are not taxed before withdrawal. Withdrawals made before the statutory retirement age are fully taxable and incur a 5% penalty, with exceptions such as death, medical grounds and, under conditions, full withdrawal by a foreigner. On death or terminal illness, IRAS allows an exemption of up to S$400,000, adjusted for earlier penalty-free withdrawals. Tax relief is not a guarantee of tax saved; it depends on your marginal rate now and at withdrawal.

There is no general answer; they solve different problems. T-bills and Singapore Savings Bonds (SSB) are short- or flexible-tenor government securities with known returns and easy exit: an SSB can be redeemed in any month without penalty (MAS). An endowment locks money in for years, offers a guaranteed maturity value plus possible non-guaranteed bonuses, and usually costs money to exit early. An endowment may suit someone who wants a fixed date, commitment and some insurance; government securities suit someone who values liquidity and certainty. Compare like for like, as shown in Endowments vs T-bills vs SSB vs fixed deposits.

Convert both to an annualised rate over the same horizon, and compare the endowment's guaranteed values first. For example, the SSB issue GX26110X (November 2026) shows an average return of 2.45% a year if held for 10 years and 1.67% for the first year (MAS, 1 October 2026). For a 10-year endowment, calculate the internal rate of return using the premiums paid and the guaranteed maturity value, then repeat with the illustrated total values at 3.00% and 4.25%. The guaranteed figure is the like-for-like comparison; the illustrated figures are scenarios. Also account for the SSB's monthly liquidity. See How to compare returns.

They change every auction or month, so this site keeps them in one dated benchmark table, reviewed monthly. As at 23 October 2026, the 6-month T-bill auctioned on 22 October 2026 had a cut-off yield of 1.95% (MAS auction results, as reported by Beansprout), and 12-month promotional fixed-deposit rates at two large banks were about 1.70%–1.85% a year for fresh funds, with minimums of S$10,000–S$20,000 (UOB and OCBC rate pages). Promotions end on dates each bank sets. Always check the issuer's current page, the minimum amount and whether "fresh funds" conditions apply; the sister site savings.sg covers T-bill auctions in more detail.

Generally no, for individuals under current rules. MAS states that for individuals, interest earned on Singapore Government Securities, which include T-bills, is tax exempt, and that SSB interest is exempt from tax. IRAS states that interest from deposits with approved banks and licensed finance companies in Singapore is not taxable for individuals, with exceptions such as interest received through a partnership. By contrast, endowment premiums do not qualify for life insurance relief, and the tax treatment of endowment maturity or surrender proceeds should be checked against IRAS's current guidance. Cross-border readers may face tax in their home jurisdiction.

Each falls under a different safety net. Singapore-dollar fixed deposits at member banks are insured up to S$100,000 per depositor per bank under the Deposit Insurance Scheme; SDIC also covers SRS monies placed as deposits with member banks, but not foreign-currency deposits or investment products. T-bills and SSB are issued by the Singapore Government. Endowments and annuities fall under the PPF Scheme, which covers guaranteed benefits only: up to S$100,000 aggregated guaranteed surrender value per life assured per insurer for life policies, and S$100,000 aggregated commuted value of guaranteed benefits for annuities (SDIC). Non-guaranteed bonuses not yet vested are not covered.

Exit costs differ sharply. An SSB can be redeemed in any month with no penalty; principal and accrued interest are returned by the second business day of the following month (MAS). A T-bill can be held to maturity of 6 months or 1 year, or sold before maturity in the secondary market at the prevailing market price, which may be above or below what you paid. A fixed deposit broken early may forfeit some or all interest, depending on the bank's terms. An endowment surrendered early pays only the surrender value, which in early years is often below premiums paid; MoneySense notes early termination "may result in losses". For surrender decisions, see saving.sg (Chinese).

All life insurers in Singapore grant a 14-day free-look period, which starts from the day you receive the policy documents (MoneySense). Within that window you can cancel the policy and receive a refund of premiums, less medical and other expenses incurred. Use it to re-read the benefit illustration, product summary and bundled product disclosure with fresh eyes, and to confirm that the guaranteed values, premium term and funding source match what you understood. Note the date you received the documents, and send any cancellation in writing within the period.

You receive the surrender value, which in early years is usually below total premiums paid. MoneySense states that on surrender "you will only receive the cash value of the guaranteed and vested bonuses", and the LIA/MoneySENSE guide warns that early surrender may mean losing all or nearly all of the premiums paid in the first years. Terminal bonuses are not paid in full, or at all, before maturity. Before surrendering, check whether the policy offers alternatives such as a policy loan, partial surrender or making the policy paid-up, each with its own trade-offs. Deeper coverage is on saving.sg (Chinese).

The Policy Owners' Protection (PPF) Scheme, administered by SDIC, protects guaranteed benefits of policies issued in Singapore, for residents and non-residents alike. For individual life policies (excluding annuities), caps are S$500,000 for aggregated guaranteed sum assured and S$100,000 for aggregated guaranteed surrender value, per life assured per insurer. For annuities, the cap is S$100,000 for the aggregated commuted value of guaranteed benefits. Guaranteed benefits include bonuses already declared and vested. Non-guaranteed amounts not yet vested, and benefits linked to the value of investment-linked fund units, are not covered.

Start with the insurer, then escalate to FIDReC if the matter is not resolved. MoneySense advises contacting the financial institution first and approaching the Financial Industry Disputes Resolution Centre within 6 months of its final reply (MoneySense, 27 Aug 2026); filing with FIDReC is free of charge, and it adjudicates claims up to S$150,000 per claim (FIDReC). Keep the documents that matter: benefit illustration, product summary, fact-find and needs analysis records, and any written explanations you received. Under MAS Notice FAA-N16, advisers recommending investment products, including life policies, must carry out needs analysis and keep records, which can help reconstruct what was advised.

No. IRAS lists "Endowment policy" among the policies that do not qualify for life insurance relief. Even for qualifying policies, the relief is the lower of S$5,000 minus your CPF contributions, or up to 7% of the insured value or the premiums paid; if your CPF contributions in the previous year were S$5,000 or more, the relief is nil. For most employees, therefore, life insurance relief is not a factor in the endowment decision. SRS contributions, by contrast, qualify for relief within caps, which is one reason people fund single-premium plans through SRS.

For individuals, annuities received in Singapore are generally not taxable, with exceptions. IRAS cites CPF LIFE monthly payouts as an example of a non-taxable annuity. Exceptions include annuities bought with SRS funds, which are taxed on withdrawal as described above and reported by the SRS operator; annuities arising from a trade or partnership; and annuities bought by an employer in place of a pension. Tax rules can change and depend on how the annuity was purchased. If you are tax resident elsewhere, your home jurisdiction may tax the payouts, so take local tax advice.

Usually yes, if the account holder is tax resident in one of Singapore's reportable jurisdictions (the list for 2025 reporting includes mainland China and Hong Kong); the outcome depends on the insurer's due-diligence findings. IRAS's CRS guidance treats a "Cash Value Insurance Contract" — an insurance contract that has a cash value — as a reportable account, and the reporting Singapore financial institution must report its cash value or surrender value. Endowments and many annuities in the accumulation phase have cash values. IRAS notes that the amended CRS takes effect from 1 January 2027. For readers with ties to mainland China, Hong Kong or elsewhere, reporting does not itself create tax, but your home tax authority may receive the information; take advice in that jurisdiction.

Two things change most. First, foreigners can contribute up to S$35,700 a year to SRS, compared with S$15,300 for citizens and PRs (MOF), and the 50% concession on a full withdrawal by a foreigner has conditions: the account must have been kept for at least 10 years from the first contribution (IRAS), and MOF's booklet requires that you were neither a citizen nor a PR on the withdrawal date and throughout the continuous 10 years before it. Second, CPF LIFE auto-inclusion applies to Singapore citizens and PRs born in 1958 or later with at least S$60,000 in retirement savings when payouts start (CPF Board); foreigners without CPF membership have no national annuity, which shifts more weight onto private savings. USD plans add currency risk. See Savings plans for foreigners and new PRs.

No. This site explains how savings plans work, how to read the documents and how to compare them with alternatives; it does not rank insurers, recommend products or predict bonuses. A suitable recommendation requires a fact-find, customer knowledge assessment and needs analysis, which MAS Notice FAA-N16 requires licensed advisers to carry out and document. You can compare published illustrations on compareFIRST, a platform supported by LIA, MAS and MoneySENSE that covers endowment policies. If you would like help applying this to your own situation, you can register your needs through the contact options on this site.