Axa Pulsar

[blurpandasg2014]

Hi all

This is my first post on this forum. Recently i was introduced to the axa pulsar policy by my agent... They are giving a 174% start up bonus if i sign for 30yrs.

if i save $250/mth (3k/yr), total for first yr i will get $8220 to buy units. However, I read from the brochure that total fees adds to abt 6% + $120 annually and axa would refund 4% on the 10th yr.

Will it be a good deal to sign up for this? Hoping for your valuable inputs

 

[kebinu]

Almost fainted.

 

[soul1984]

do look at the funds u are going to buy at.. it is different percentage for different fund..

 

[stoneblackdragon]

Give you drumstick, take back chicken(s) plus lock you in.

ILP right.... my advice is avoid, buy your own index funds or unit trust if you want thru dollardex, fundsupermart,dbs,poems whatever. accumulate yourself and can liquidate anytime. pay 1% sales charge + management fees...

The bonus is to trap you inside only, u will pay them back much more.

Never really did the math but 6% of 3k is $180 x 10years = $1800 given up in fees alone??

$120 annually is also 4% of 3k...

$120+$180 a year in costs alone in your $3000 investments. Every year down 10%.
So you are already losing 10% of your investments a year.

You need to choose units that can potentially make 10% a year... to earn $0..

buy fixed D or ocbc 360 even better,

the refund don't mean anything liao, after u factor in all your losses. and don't even know they refund one year or ten years. . .

 

[blurpandasg2014]

Almost fainted.

Why isit do you say so? The agent told me that she would place 70% into PICTET GENERICS FUND and 30% into SCHRODER ASIAN GROWTH FUND.

However, i do find it kinda fishy cos it seems that the fund prices are not updated daily on the axa web and do not have the Bid-Offer spread like the normal ILP funds

 

[kuro]

i think you need to talk to your agent again becos you do not know the fee & charges.

and of cos, most people here in the forum will ask you do your own investment becos they are all able to generate higher returns.

 

[blurpandasg2014]

i think you need to talk to your agent again becos you do not know the fee & charges.

and of cos, most people here in the forum will ask you do your own investment becos they are all able to generate higher returns.

She did not really mention the charges but i read it up on the brochure which stated

Account Maintenance Fee
4.0% per annum / 12 of account value of first 18 months premium
Investment Maintenance Fee
1.5% per annum / 12 of total account value
Administrative Fee
SGD 10 / USD 8 per month

 

[stoneblackdragon]

No la. but.. WTF
If you are interested in buying unit trusts regular savings plan. BUY ON YOUR OWN TERMS. not through insurance. pay less fees and don't get locked down.

if you want to buy schroder asian growth fund.
Go ahead: Fundsupermart.com | Global www.dollardex.com www.eunittrusts.com.sg aviva navigator, dbs ibanking, scb: they all sell unit trusts too.. 6% + $120 annually is not the way to go.

DON'T be tempted by the bonus start or whatever... do your math.. how much you will pay them over 30 years.

btw.. I never even heard of the PICTET generics fund..
I was foolish enough to sign an ILP when i was an NSF, I cancelled it early because it is not worth it to pay $400 a mth.. I lost about 1k+ but so be it. glad I did.

For your $250 a mth... I rather you go buy STI-ETF from ocbc/posb
Statistically proven to do better than most unit trusts averaging 7% a year

Okay, just checked it out, the fund seem to be doing well with annuallized 9% a year. nobody knows if it will continue to do so. BUT by giving AXA 6% + 4% in fees you are still losing 1%. might as well go buy the fund yourself and pay 1% to 1.5% in fees

Pictet-Generics-P USD - Fund details


Also realised Pictet generics is a healthcare fund, your advisor showed it to you because healthcare funds all did well during these few years but they are super volatile

Fidelity global also averaged 9% a year, and u can pay 1% sales charge in fundsupermart (+ platform fees opps)
https://secure.fundsupermart.com/main/fundinfo/viewFund.svdo?sedolnumber=FIHLTC

UOB: united healthcare also gave about 8.9% annuallized
https://secure.fundsupermart.com/main/fundinfo/viewFund.svdo?sedolnumber=370301

 

[stoneblackdragon]

If you want to do unit trusts/mutual funds. Sure go ahead.

But don't let chiobu agent take your money gao gao ok?

The account maintainence fees of 4% already make it sound like a losing proposition>

IF you want to buy funds on a monthly regular basis, do it on your own terms. it is not that difficult, in an ILP you dont have liquidity, you are locked in, every month you have to dig up $250 to invest (of course if you don't even have that you might be in some trouble) BUT you need to realize you can get it cheaper and buy in, or do regular savings plan on your own terms.

There are even cheat codes like starting an RSP on funds supermart = 0 sales charge -> transfer it to dollar dex account on the second month. = no platform fees, no sales charges. (just incur the annual management fees)

ALso have to ask about switching charges, the kind of exposure.
IMHO introducing you to a healthcare fund (which performed well these past few years but also highest risk) and having you take 70% + an asian equity fund is rather irresponsible.

At the most basic your funds should be an exposure of global equities, some fixed income, etc...

last piece of advice, DONT take the ILP. if you want to contribute $250 every month to buy funds (or even more when prices are low or you think its a good time) go ahead. Dont PAY MORE and LOCK YOURSELF in. don't be tempted and trapped by the accelerator bonus or whatever.

Companies are here to make money, even insurance and fund companies. ride on the lesser evils at least.

last advice, 30 years X $300 = $9000
What they give you is only $5220.
The money lost is much more due to compounding and increments along the way of the fund price, if you picked the right funds

Along the way you will lose, switching charges bla bla expense charges etc..

Go ahead and google ILP read about their pros and cons.
You can still buy these funds if you want to... i rather you buy yourself. make sure you have a good health insurance hor.

 

[blurpandasg2014]

If you want to do unit trusts/mutual funds. Sure go ahead.

But don't let chiobu agent take your money gao gao ok?

The account maintainence fees of 4% already make it sound like a losing proposition>

IF you want to buy funds on a monthly regular basis, do it on your own terms. it is not that difficult, in an ILP you dont have liquidity, you are locked in, every month you have to dig up $250 to invest (of course if you don't even have that you might be in some trouble) BUT you need to realize you can get it cheaper and buy in, or do regular savings plan on your own terms.

There are even cheat codes like starting an RSP on funds supermart = 0 sales charge -> transfer it to dollar dex account on the second month. = no platform fees, no sales charges. (just incur the annual management fees)

ALso have to ask about switching charges, the kind of exposure.
IMHO introducing you to a healthcare fund (which performed well these past few years but also highest risk) and having you take 70% + an asian equity fund is rather irresponsible.

At the most basic your funds should be an exposure of global equities, some fixed income, etc...

last piece of advice, DONT take the ILP. if you want to contribute $250 every month to buy funds (or even more when prices are low or you think its a good time) go ahead. Dont PAY MORE and LOCK YOURSELF in. don't be tempted and trapped by the accelerator bonus or whatever.

Companies are here to make money, even insurance and fund companies. ride on the lesser evils at least.

last advice, 30 years X $300 = $9000
What they give you is only $5220.
The money lost is much more due to compounding and increments along the way of the fund price, if you picked the right funds

Along the way you will lose, switching charges bla bla expense charges etc..

Go ahead and google ILP read about their pros and cons.
You can still buy these funds if you want to... i rather you buy yourself. make sure you have a good health insurance hor.

Thank you for your advice. I will read up more

I also mentioned to the agent that investing 70% in such an expensive fund would mean minimal units (every mth $170 only can get 0.53 units of pictet) ...remaining $80 about 30 units of schroder.

A fall of schroder (by a single cent) would have a more significant impact then pictet rising 1 cent. So i find it not a very sweet deal (Does what i say mean any sense ;X)

 

[Shiny Things]

I nearly plotzed. This is a HORRIFIC product. RUN AWAY.

They're going to charge you five-and-a-half percent a year in account management and "maintenance" fees.

And they're trying to push that stupid "generic pharmaceuticals companies" fund on you, that charges another two percent per year on top of the 5.5% platform fees.

The average return for the stockmarket is about 8%-ish per year. If you give up 7.5% of that each year in fees, you're going to make basically zero. Zero in thirty years. You would quite literally be better off leaving your money in the bank for thirty years.

 

[Shiny Things]

then you will need to read more or read into more details.

Pulsar fees is lower than online platforms like fundsupermart, dollarex etc. Go ask your agent to explain to you. Basically it is just another platform.

This - I'm sorry, this is just complete rubbish. FSM and Dollardex don't charge five percent. No reputable funds management platform charges anywhere near 5%. AXA should be ashamed of themselves.

This is an exercise in "how hard can we screw our customers without them complaining?"

 

[stoneblackdragon]

When you call the agent to say you don't want it, there will be a lot of persuasive techniques, data, visualizations, bonuses used to convince you

Be firm and reject it, or you will definitely end up regretting down the road.

 

[kebinu]

Be firm in rejecting. Read more of shiny posts here on how to invest for the long term.

Just get term to cover till say 55 or 65.

 

[Senpai]

Before accepting the funds that your agent is recommending, do an investment profiling test to find out if you have a conservative, balanced or aggressive profile. Make sure the funds that you select fit into your profile.

 

[Shiny Things]

AXA is not even charging 5%.

Good god, dude. Have a look at the fee list:

• Account Maintenance Fee: 4.0% per annum / 12 of account value of first 18 months premium
• Investment Maintenance Fee: 1.5% per annum / 12 of total account value
• Administrative Fee: SGD 10 / USD 8 per month
• Policy Maintenance Fee: 0.5% per annum / 12 x initial annual Regular Premium x No. of year(s) for which policy has been in force
• Insurance Charge: For Enhanced Death Benefit only.
• Early Encashment Charge (EEC): Account value of first 18 months premium x EEC%
• EEC%=100% for first year; the rest is with reference to number of years in remaining premium payment term years.
• Management Charge: According to the investment-linked policy sub-fund you choose. Details can be found in the Fund Summary.
• Switching Fee: None

So for the first two years or so, you're paying 5.5% on the account maintenance fees and investment maintenance fees. After that point, it drops to "just" 1.5%.

But then a Policy Maintenance fee starts to kick in, because you haven't charged enough already! By the time the policy reaches its 20th year, you're paying ten percent of every new dollar you put into the account in fees. That is an absolute disgrace.

And then on top of that the client's being directed into ridiculously high-cost funds (2% per annum is stupidly high).

And if you want to make a top-up investment, you get charged five percent on that extra money. Five percent brokerage! If I charged anyone five percent when I was working in a bank they'd have hung up the phone and never dealt with me again.

This is a bad product. This is convincing people that they're being smart and sensible investors by starting a regular savings plan, and then bending them over and screwing them.

 

[stoneblackdragon]

well said!

the last sentence really takes the cake

 

[kuro]

Good god, dude. Have a look at the fee list:

• Account Maintenance Fee: 4.0% per annum / 12 of account value of first 18 months premium
• Investment Maintenance Fee: 1.5% per annum / 12 of total account value
• Administrative Fee: SGD 10 / USD 8 per month
• Policy Maintenance Fee: 0.5% per annum / 12 x initial annual Regular Premium x No. of year(s) for which policy has been in force
• Insurance Charge: For Enhanced Death Benefit only.
• Early Encashment Charge (EEC): Account value of first 18 months premium x EEC%
• EEC%=100% for first year; the rest is with reference to number of years in remaining premium payment term years.
• Management Charge: According to the investment-linked policy sub-fund you choose. Details can be found in the Fund Summary.
• Switching Fee: None

So for the first two years or so, you're paying 5.5% on the account maintenance fees and investment maintenance fees. After that point, it drops to "just" 1.5%.

But then a Policy Maintenance fee starts to kick in, because you haven't charged enough already! By the time the policy reaches its 20th year, you're paying ten percent of every new dollar you put into the account in fees. That is an absolute disgrace.

And then on top of that the client's being directed into ridiculously high-cost funds (2% per annum is stupidly high).

And if you want to make a top-up investment, you get charged five percent on that extra money. Five percent brokerage! If I charged anyone five percent when I was working in a bank they'd have hung up the phone and never dealt with me again.

This is a bad product. This is convincing people that they're being smart and sensible investors by starting a regular savings plan, and then bending them over and screwing them.

If I put in $12000, I will get $32,880 because of the bonus. On the 10th year I will get an additional 4% of total premium paid. Policy maintenance fee will be refunded at end of payment term. With all these included, the fees is less than 2%.

As always, cost. If today a fund that has a track record of getting a growth of 15% for past 10 years. I won't mind giving the fund manager 2%. You dare charge high, the returns must be there. Want low charges? Go for bonds then. 2-3% returns with only 0.5.0.6% management fee. And such funds already have their fund management fee included in their fund growth.

Why the private banking clients don't look at cost as their #1 priority but rather how much potential growth they are able to get from the money invested? But retail investors will always look at cost first.

But of cos, most investors in HWZ are smart and good investors.

 

[stoneblackdragon]

even VERY good fund manager can lose BIG.
for retail investors, you can use fundsupermart or dollardez or poems to buy.

Bill Miller: you can buy his legg mason opportunity trust for minimum 1k sgd. he averaged 15% for 15 years but lost big 50% in the 2008 crisis. now his new fund avg 30% last 2 to 3 years.

you can buy pimco total return, templeton total return or even dan fuss funds , or whoever are the top fund managers out there. definitely better than the picter generics... even some blackrock funds... and they all charge less than 2% in management fees...

you can even cough up 200k usd to biy a share of berkshire hathaway.. wait for it to become 300k haha

however... past performance is not guaranteed of future results.

for me.. I will stick with index funds

 

[Shiny Things]

Want low charges? Go for bonds then. 2-3% returns with only 0.5.0.6% management fee. And such funds already have their fund management fee included in their fund growth.

2% for a stock fund is too much. 0.5% for a bond fund is too much. And 2% for a platform fee, no matter how you try to confuse the matter with bonuses and fee rebates and stuff, is too much.

Why the private banking clients don't look at cost as their #1 priority but rather how much potential growth they are able to get from the money invested? But retail investors will always look at cost first.

Absolute crap. Smart investors might not look at cost as their #1 priority, but it's a close #2: they don't pay 5% upfront and 4-5% trailing (2% to the fund and 2% to the platform) when they can get the same exposure through an ETF for 0.2% brokerage and 0.5% trailing.

But of cos, most investors in HWZ are smart and good investors.

Absolutely right. And some of us are mouthy angmohs who aren't afraid to call salesmen out on their bullsh!t.

Honest question: have you ever been told "your product is too expensive" before? It sounds like you really haven't thought through how much damage fees can do to an investment: if I invest $100k in your ILP for thirty years, and overpay by 3% per annum compared to a balanced ETF portfolio, I'll end up paying more than $100,000 in management fees that I shouldn't have to pay.

Your customers want their hundred thousand dollars back.