10 years saving plan

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Anyone interested in Retirement / Education plan? There is a 10 years saving plan...

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Posted · Report post

Anyone interested in Retirement / Education plan? There is a 10 years saving plan...

now i know got 5 years saving plan already.. :P

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Posted · Report post

Mind to share your plan?

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Hubby just bought an insurance policy from AIA, but it's more the retirement savings plan rather than those normal insurance. Moreover, in view of the current low FD rate and stagnant stock markets, it seems like a better way to save/invest your money.

It's a 20-year plan and the premium is as such, for the 1st 10 years, you pay RM500 a month, so at the end of 10 years, you would have paid RM60,000 (premium can be varied).

For the 2nd 10 years, you don't have to pay for anything.

At the end of the 20 years' time, when the policy mature, you get back, minimum, RM120,000 (double of the total premium paid).

The minimum return amount is stated in the policy, however, it can be higher.

The reason for this 20-year tenure is due to the fact that this insurance is backed by Bank Negara's bonds, and bonds' maturity is 20 years. That's why after 20 years only you can get back your money.

It suits us, the newly-wed couples, a lot, as we plan to have kids 2 years later, and if succeed, after 10 year, our kid would be 7-year old and ready for primary education which would further increase our financial commitment, however, by the time we have already stopped paying for the premium.

And wait for another 10 years, here comes the college time ...by then the policy matures and we can withdraw the RM120k for his/her studies.

That's hubby's plan, and I am so glad that he is planning for our future and kids. :lol:

Btw, the BNM bond is running low, so whoever want to buy, please be quick. However, please do check on the rate of return, cuz after hubby bought the insurance, gov reduced the OPR, which AIA might adjust the return accordingly. :cool:

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Posted · Report post

Pink Kitty, that sounds like a really good policy. So just to confirm, is the RM120k minimum guaranteed in writing in your policy or is it just a forecast by your AIA agent?

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Pink Kitty : An insurance policy is one of the ways to 'save' your money for future. Just one point that I would like to highlight:

When an insurance policy states that you need not continue paying the premium but it will still be in force after a certain amount of time, it is actually your insurance policy paying the premium for itself. This is done by using the dividends generated by the policy annually to pay for the insurance cost. Meaning part of your returns on the policy is channeled to pay for the premium itself. While this is a good option for those on a tight budget, it is best to let all the returns be channeled back into the policy as principal and let time compound the interest for you. If you opt to pay the premium for the full 20-year term, you will find that your returns will be higher.

Just do a rough calculation:

If your policy cost RM1000 per year in 10 years that will be RM10,000 taken out from your returns. This may seem like a small number but if you figure in the compounding effects of re-investing the returns you would be looking at losing about RM3,519 at a 6% interest for the 10 year period. That's about 30% of your RM10k.

So for a policy costing RM6k per year, the amount you are losing is quite significant. My calculation is very rough and does not include the amount that you would have accumulated during your first 10 years into account.

The aim for investing is such a way is to let time compound the interest for you. Thus letting your returns pay for the premium is defeating the purpose of your aim to a certain extend.

One must remember that in insurance, there is no such thing as you do not need to pay and still get all your benefits. You will still be paying but you are borrowing from your future returns to pay for it.

Ask your agent to calculate the returns for you in the scenario that you pay full premium for the whole 20-year term. Compare the figures and then decide which one you want to stick to. Of course your agent will tell you that the figure is not guaranteed because in investment, nothing is guaranteed but it will give you a better picture of what you are investing in.

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Posted · Report post

I totally agreed with daddyo, nothing in this world is "GUARANTEE". DO NOT TRUST your agent if he/she said the money you invest is guarantee "RETURN".

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Posted · Report post

I totally agreed with daddyo, nothing in this world is "GUARANTEE". DO NOT TRUST your agent if he/she said the money you invest is guarantee "RETURN".

I totally agreed with daddyo, nothing in this world is "GUARANTEE". DO NOT TRUST your agent if he/she said the money you invest is guarantee "RETURN". Current in the market, the only guarantee is "Capital Guarantee", meaning total amount you have pay to the insurance company is guarantee.

Whatever saving plan offer by any insurance company (AIA, GE, Prudential, Alliance) are good, but it still need to depends on capabilities. You must ensure within the saving period, you are able to pay the premium. Work up a finance planning before taken up any investment plan. If any emergency happen, your saving still can help you to pay premium for at least 6 months.

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I totally agreed with daddyo, nothing in this world is "GUARANTEE".

Whatever your agent said, can be different from your insurance policy. Make sure once you get your policy the 1st thing is to read it. If you find it is not as "promissed" you can cancel immediately with full refund with certain time they stated there.

Reading the policy is your responsibility and also make sure you understand what you insure.

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I totally agreed with daddyo, nothing in this world is "GUARANTEE". DO NOT TRUST your agent if he/she said the money you invest is guarantee "RETURN".

One prudential agent approached us with the Similiar plan as Pink Kitty, which we need to put minimum RM500/month up for 10 years, and we can STOP paying from 11th year onward but we can still get RM2280/year from year 11th until 20th years . finally when the policy mature at year 21th, then we can get back about RM93K. SO total we cab get RM115K from the RM60K that we invested in the first 10 Years... and she said GURANTEE return at RM115K...its sound vert attactive...anyone prudential agent can verify for me the statement of gurantee return, i means its is true??

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Hi Riple,

I think I can help you in this as I'm the Prudential agent :P

Is not guarantee you can get RM115 at year 21. The figure is projection amount at 7% return. However, this plan is capital guarantee. Capital guarantee means at the matured date, you can get back "Sum Assured" (I'm not sure your sum assured) + the Guarantee Survival Bonus which is RM2280 from year 11 - 21. (Survival Bonus calculate based of 4% of the sum assured).

Currently Prudential has lesser the premium to RM200/month, this offer is until 20 June 2009.

RM500 is not a small amount, you must plan carefully and figure out your future commitment.

Is quite difficult for me to explain in more details about this plan in here as my english is so so. If you have doubt in this plan, I can be contacted at 012-2012576.

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Posted · Report post

Hi adkate01,

sorry for late reply.

The 10 years saving plan is a whole life plan.

U need to pay premium for 10 years.u can choose to receive the $$ on 11th years onwards or 20th years or 25th years.

Can u PM me ur email?

thanks ....

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Posted · Report post

10 years is not very long. i've heard of one from ambank but i don't quite rmbr the name of d product :[

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Posted · Report post

That want is for retirement plan lol...the guarantee is 4% set by government. the other 4% to 9% is not guarantee..actually many insurans company also will hv those plan.

ING also have what, is 12yrs saving (not paying), then every yr take ard RM3400 de interest, until age of 100.

If at age of before 100 anytime u feel dont wanna take the interest already then u also can surrender at least will take back more than u save 2 times.

Therefore, if every yr RM3400 u dont want to take out, then u can keep it in the policy, there will be additional interest for u is 6%. so i will suggest every 5yrs take once is ard RM20k.

Anyway, dont simply said is not guarantee or watever because those insurans company record never goes lower than bank interest, rite? at least u hv save your own money for your future, and interest at least higher than bank.

At the same time, u also cannot save all your money in the policy plan la, in case emergency u can use, and must invest some in unit trust.

because i am doing like that, and its make me feel doing financial job is very enjoyable and teach ppl how to use hard earn money to archieve their financial freedom.

So now i also join ING and public mutual already lo..haha..

At last hope u all can get what u all dream about la..good luck..and remember always be happy..haha..

reno1987@hotmail.com

my phone>>email and ask me haha..

salangheyo..

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Posted · Report post

That want is for retirement plan lol...the guarantee is 4% set by government. the other 4% to 9% is not guarantee..actually many insurans company also will hv those plan.

ING also have what, is 12yrs saving (not paying), then every yr take ard RM3400 de interest, until age of 100.

If at age of before 100 anytime u feel dont wanna take the interest already then u also can surrender at least will take back more than u save 2 times.

Therefore, if every yr RM3400 u dont want to take out, then u can keep it in the policy, there will be additional interest for u is 6%. so i will suggest every 5yrs take once is ard RM20k.

Anyway, dont simply said is not guarantee or watever because those insurans company record never goes lower than bank interest, rite? at least u hv save your own money for your future, and interest at least higher than bank.

At the same time, u also cannot save all your money in the policy plan la, in case emergency u can use, and must invest some in unit trust.

because i am doing like that, and its make me feel doing financial job is very enjoyable and teach ppl how to use hard earn money to archieve their financial freedom.

So now i also join ING and public mutual already lo..haha..

At last hope u all can get what u all dream about la..good luck..and remember always be happy..haha..

reno1987@hotmail.com

my phone>>email and ask me haha..

salangheyo..

Hi, I just took Prudential 10 years savings plan with RM500/mth. I found that it is very good and my agent did advice me that this not just can be ur children future edu fund, it also can be serves as 2nd EPF fund.. coz I agree that almost everyone will finish their EPF dund in 3 years time... one 1st EPF fund finish then can use the 2nd EPF fund.. coz I dun wan next time my children send me to old folk home coz dun hv own money to survive when old... Since now I still able to work and save money ma... I one day I can't save the money due to other reason, I still got money...

anyone interested, pls email me... janetpo811011@gmail.com... Let me intro my agent to you... She helps me a lot...

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@Pink Kitty

Sigh... I am not trying to get your hopes high TS, but do remember to post back after 10 years later.

There are many plans/agents out there that says the payment is only up to 10 years, but end up paying for 20 years due to the cash values accumulated is not enough to pay off the balance of another 10 years.

Do read in the FULL quotation on the duration one is needed to pay.

Insurance is about protection, never for investments/savings. Even if the plan is called Investment Linked Policy, its main focus is to provide financial security/protection NOT INVESTMENT.

Let us put our thinking cap on, shall we? You see when it comes to any insurance products, there is this thing called insurance charges, AGENT COMMISSION, policy charges.

In short, if you put in RM100, the amount that is 'saved' is only RM 60, while RM40 will be used to buy you the protection, and the above. Most insurance plans out there the agent commission is up to 6 years. Thereafter no more commission.

Hence, in order to make your money grow, insurance will take a longer period to even 'break even' (> 20 years). Hello?! The purpose of investing is to make your money grow, and not 'break even' after 20 years! Not to mention you have to put in your money for 20 years and cannot even touch it.

In my starting days a 70 yo "apek" selling apples did say to me, if he buys an apple for RM1 today, he can sell it tomorrow at RM 1.50, making an OVERNIGHT profit of 50%, not waiting 20 years. :D

--

You did mention you will get back a minimum RM120K, do you see the word GUARANTEED? If not, it is merely a projection.

OK lets assume there are some truth in that insurance product.

Assuming you put in RM 60K, and get back min RM 120K after 20 years. The IRR is 3.5240% with the exception that you cannot touch this money for 20 years.

Oh yes, I am an insurance agent, not financial consultant

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