AIA smart growth

[chopra]

Merry Christmas

first para- i'm asking you to compare yourself, information is freely available on the net these days e.g. this forum. i didn't say i was not willing to share. u must have met really bad experiences with some agents to judge me so quickly. Anyone can compare and sell products with research, but not everyone can find the best solution for a given situation. In insurance, no 2 products are ever the same.

sec para - yeap he can. cpf lock up till age 65. sgs bid has minimum amount required for bid.

third para - hahaha...no...cpf can't buy ilp/life plans. only investment plans with minimal life protection. Only certain funds can be bought with CPF too and not the full range from the companies. Even so, comms is not a penalty. Jobs who don't have basic or salary are comms based. etc. Real estate,stockbrokers, car sales, contractors. Pay and respect for the service of the consultants work, advice and profession. Commission payout in the insurance industry is implemented by their respective companies. We can't ask for more or less than what we are given that the company pays.

fourth para- I am addressing bond funds. there are alot of these funds in that you can find in Fundsupermart.com | Global and the have different set of fees.

You do address cost alot in your replies. I believe you are very cost sensitive. But in this world, good things are not cheap, cheap things are not good.

first para - most DIYers know our stuff. As you acknowledged, all investment-insurance products are unique and so I was asking you to show me yr underlyings so that i can do an apple to apple here.

sec para - erm correct me if I'm wrong, cpf locks till 55 as of now. sgs min bid is 1k, which meets ts requirement.

third - cpf can buy life and some of the ilp. I agree we should pay for service. these insurance consultants are merely middleman whom most of them probably know nuts about the underlyings. y pay them? I would instead bypass this channel and go direct to the fund manager.

fourth - sure

last - the cost of buying life/ilp is too large to ignore. this is above the norm of 0.5% if diy.


google "why actuarists do not buy their own products" or something along that line. you will get a clearer picture.

 

[locknlearn]

I know this is an old thread, but still relevant in my case, as I have the 21year plan. Just started to learn about investing and realise very late in the game that this policy is not a smart use of money.

Am facing paying the last 12th year of premium, around $2200K. Surrender value around $16K. Won’t be able to recover $8K+ premiums.

Surrender and free the money up, so it won’t be tied up in the policy for the next 9 years until maturity? Or just give in to the sunk cost?

 

[tangent314]

I know this is an old thread, but still relevant in my case, as I have the 21year plan. Just started to learn about investing and realise very late in the game that this policy is not a smart use of money.

Am facing paying the last 12th year of premium, around $2200K. Surrender value around $16K. Won’t be able to recover $8K+ premiums.

Surrender and free the money up, so it won’t be tied up in the policy for the next 9 years until maturity? Or just give in to the sunk cost?

No, don't fall for the sunk cost fallacy. Look at what the plan gives you for the future and decide if it's good enough for you.

Calculate the XIRR from between the current value and surrender at 65 (assuming that's around the age you plan to retire). If you can accept that XIRR then keep the plan.

If you'd like us to help you calculate the XIRR, post your latest BI.

 

[hgr126]

Same as the above poster, I am wondering if I should give up on my AIA endowment plan as well.
My endowment plan involves paying premiums for 12 years, the value then sits inside for an additional 12 years = total for 24 years before getting the full benefit shown below.

I have currently paid in for almost 3 years at annual premium of $1800 (monthly 150). Surrendering now will get me back only around 7-800. Loss of around ～4.2k.

If i hold onto this policy,
At the end of this 24 year policy:
Total basic premiums paid to date = 20,480 (approx 12yrs x 1800)
Guaranteed = 26,000
Projected 3.25% (non-guaranteed) = 7704
Projected 4.75% (non-guaranteed) = 17108

Can someone kindly be able to help me calculate the returns and advise whether I should just surrender the policy and lose the 4.2k right now?

Thank you very much!

 

[oceanicmanta]

Same as the above poster, I am wondering if I should give up on my AIA endowment plan as well.
My endowment plan involves paying premiums for 12 years, the value then sits inside for an additional 12 years = total for 24 years before getting the full benefit shown below.

I have currently paid in for almost 3 years at annual premium of $1800 (monthly 150). Surrendering now will get me back only around 7-800. Loss of around ～4.2k.

If i hold onto this policy,
At the end of this 24 year policy:
Total basic premiums paid to date = 20,480 (approx 12yrs x 1800)
Guaranteed = 26,000
Projected 3.25% (non-guaranteed) = 7704
Projected 4.75% (non-guaranteed) = 17108

Can someone kindly be able to help me calculate the returns and advise whether I should just surrender the policy and lose the 4.2k right now?

Thank you very much!

At end of 24 years, I got the following IRRs :
@4.75% = 3.76% pa
@3.25% = 2.415% pa
@Guaranteed = 1.004% pa

My relatives were also sold a 20yr SmartGrowth plan. Lower premiums & lower IRRs than yours.

They decided to terminate after 2 years ... they are late 50s & realised no point having 20 yr savings plan that they can only get back $ at 80yo.

 

[blurpandasg2014]

Mine is $686.50 for 12yrs ($8238/-)

@Maturity

G: $10,000 (IRR: 1.05%)
3.25%: $2963 (IRR: 2.461%)
4.75%: $6850 (IRR: 3.895%)

 

[blurpandasg2014]

Same as the above poster, I am wondering if I should give up on my AIA endowment plan as well.
My endowment plan involves paying premiums for 12 years, the value then sits inside for an additional 12 years = total for 24 years before getting the full benefit shown below.

I have currently paid in for almost 3 years at annual premium of $1800 (monthly 150). Surrendering now will get me back only around 7-800. Loss of around ～4.2k.

If i hold onto this policy,
At the end of this 24 year policy:
Total basic premiums paid to date = 20,480 (approx 12yrs x 1800)
Guaranteed = 26,000
Projected 3.25% (non-guaranteed) = 7704
Projected 4.75% (non-guaranteed) = 17108

Can someone kindly be able to help me calculate the returns and advise whether I should just surrender the policy and lose the 4.2k right now?

Thank you very much!

How much is yearly premium on annual mode? Seems like your IRR is not bad

 

[spicebuttons]

No, don't fall for the sunk cost fallacy. Look at what the plan gives you for the future and decide if it's good enough for you.

Calculate the XIRR from between the current value and surrender at 65 (assuming that's around the age you plan to retire). If you can accept that XIRR then keep the plan.

If you'd like us to help you calculate the XIRR, post your latest BI.

Yes, I'd appreciate help with XIRR calculation.

I had a critical illness rider on this, for sum of $30K. This added $85 on top of the basic annual premium. For simplicity, I thought I shouldl leave out the cost of that rider.

I haven't gotten the latest BI, so this is based on the BI that came with the policy:

Total basic premiums paid to date = $23584 ( 11yrs x 2144)
Guaranteed = 30,000
Projected 3.75% (non-guaranteed) = $10112
Projected 5.25% (non-guaranteed) = $18418

Surrender value now (in 11th year) = $16157