Despite knowing Endowment is "BAD" in a way, i introduced it to my friend. Monthly premium $3xx.
Because his pattern more than badminton, having a "BAD" plan is better than no plan
Would you want to see him struggling his money gambling, drinking? Or do you want to see your friends struggling to pay insurance endowment plan? I chose the latter
That theory is flawed in the sense you are assuming that he will choose to "struggle" to pay the premium for the endowment plan. This theory conveniently ignores the scenario whereby he decides the plan is too painful and chooses to terminate/lapse it. How much money does he lose then?
If he is young and he is able to currently set aside money to pay the premiums at this point, it would also indicate he can do the same in setting aside money to invest more efficiently in a simple balanced portfolio proportionate to his age.
The silver lining in this, is that he works his money much harder and much more efficiently and also the fact that the money set aside is more liquid compared to an endowment. He can also lower the amount he invests monthly per mth if he's jobless, etc. The flexibility is there. And honestly without much work every year, the returns are going to beat the endowment returns flat out as we look at longer terms.
The fact of the matter is, it boils down to the person's commitment and if he is someone who cannot find it in himself to set aside money every month, and needs an endowment to "force" himself, he will find a thousand and one reasons to also not follow through with premium payment.
Personally, at the end of the day, I think what matters is for someone to understand the purpose and goal, and once he/she does that, then endowments are really kind of pointless if you're going to argue from the "forced" savings point.
