Ministry of Health reported that 1 in 2 Singaporeans age 65 could be severely disabled in their lifetime.
Disability can arise from illness or accidents, almost always when we least expect it.
Given the possibility, how ready are you for this?
What is severe disability? It is defined by the inability to perform 3 out of 6 activities of Daily Living.
In the event you cannot perform any of the 3 independently, you are considered severely disabled. This event could be caused by a severe Stroke or even a spinal cord injury, to name some examples.
Realizing that this could happen to anybody and the devastation it could do to one’s family finances, the government introduced Careshield Life, a compulsory long-term care insurance programme to provide a monthly disability income of $600/month to those who qualify. Only Singaporeans born 1980 or later will be insured, as and when they reach the age of 30.
Under the scheme, they will start paying annual premiums through their Medisave accounts upon reaching their 30th birthday, until the age of 67.
At the point of writing, indicative premiums for 30-year-olds start at $206 a year for men and $253 for women.
The level of payout will increase over the years, starting with $600/month this year. Doing so allows the payout to stay relevant as cost of living rises through time.
Take note that once a person qualifies to claim this insurance, the payout would stay the same throughout the entire term. This means that someone claiming Careshield Life this year 2020 would be getting $600/month throughout.
Is $600/month sufficient if one were to be made severely disabled? Stay tuned for my next post as I discuss more about the cost of long-term care in Singapore.
Get in touch with me for a complimentary 1-1 consultation to help you plan to meet your financial needs at all stages in your life. Schedule your appointment now via Whatsapp at https://wa.me/6592218526
Disclaimer: The views expressed here are solely those of the author in his private capacity and not necessarily to the author’s employer, organization, committee, or other group or individual.