NTUC Income CEO, Mr Tan Suee Chieh, invited all insurance advisers including Independent Finanical Advisers and Journalist from all major Newspaper for this product launching.
Mr Tan announced that this is the first of its kind and will be the revolutionary way of savings for Singaporeans. What plan is it exactly?
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Basic Product FeaturesType: Participating Endowment Policy
Term: 15 to 25 yrs
After 2 yrs, 5% of Sum Assured will be given out as coupons
Eg, if you save $3,000/yr x 20 yrs, $1,800 of funds can be taken out as coupons from the Cash value
You have 3 choices for this $1,800
a) To take out and we give you a cheque yearly
b) To leave in the Endowment Policy and earn a projected returns of 3.5%
c) To invest the money into a large diversified fund with zero charges
If you take option 1, you may have taken $79,382 over 20 yrs inclusive all coupons
If you take option 2, you may have 87,475 after 20 yrs
If you take option 3 and investment earns 5% pa, you may have $88,803 after 20 yrs
(Above figures are projected)
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My Opinion after Analysis
* It is a new marketing concept, suitable for low risk savers who are half sure about savings through ILP and not sure of their financial obligations over 20 yrs.
* The investment option for the coupon is attractive. We are able to invest at Bid Price which means zero charges. UTs in the market charges 2-3% bid offer spread.
* The returns are modest over 20 yrs period as flexibility comes with some cost
1) Option 1 yield - ~2.14%
2) Option 2 yield - ~3.80%
3) Option 3 yield - ~4.04% (Basis 5% investment returns)
For someone who are able to invest the whole $3,000/yr closely, he's more likely to get a better returns.
3 comments:
Again its May. May.... May.... May. This is similar to what banks try to tell you. Ohh no problem sure make money. but when funds dont make $$$, than ohh return you principal, we are sooo sorry. No wonder the fund managers are making so much money.
A dollar Cost Averaging method of investment reduces risk as we invest same amount at all part of the investment cycle.
Likewise, the returns are reduced if we adopt this during a bull market run.
If we invest, we take a risk.
If we don't invest, it is also a risk.
Might as well rely on a historically proven way of investment.
1.You take the cash back, return is less 2%.Put in the toilet is better. It is liquid.Every morning you do your business you can see and touch while sitting on the throne.
2.Keep with NTUC , no quarantee. Can be zero but agents don't tell you.
Best place place to put is money market....liquid..can get over 3%.
Better than the #1? right?
3.invest in ILP at bid price....
Why so idiotic to let them invest only 65% of your premium when you can invest 100%...offer price never mind , still better at 100%
ONly idiots will invest in revosave.
Adreain, you know this plan is a screwed up plan. Don't con people and 'hai see' people especailly poor people.
Ntuc is resorting to cheating the unsound customers, is it?
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