What if CPF Life annuity payout is based on assuming a 5% return?

Ok, let's be realistic that this is a hypothetical exercise because it is unlikely that anybody would pay you 5% return without taking any risk!
Still, let's just do the exercise (assuming you are willing to take some risk to get higher return)...

Assume your original capital at 65 years old = $240,450.
Assume no bequest, dead At 86 years old (i.e. you live for 21 years thereafter from 65 years old).
Expected payout period in years    = 21
Rate (Annualized) p.a.                  = 5%
Payment per month                       = $1,543

Now, $1,543 per month is actual not bad for 1 person to live on!
Don't forget, median household expenses is about $5,594 per month and that is for about 4 people's expenses (assuming there is 4 people in 1 household)!

Divide $5594 by 4 means the average monthly expenses per person in the 4-people household is about $1398.50, less than the hypothetical 5% return CPF Life annuity payout!