Endowment Plan for 60yr old

[AhPek_Lion]

My parents just signed up an endowment plan with pru... Premium of 5k/yr for 5yrs.. Mature on 10th year and getting back only 26k+ (3.25%). Equivalent to 0.69% IRR. In addition there is another $600+ payout due to them placing the 25k lump sump at the start? Not very sure abt the details

Still within the free look period. Just wondering if there is any better plans that is capital guaranteed, better returns and short term (10yrs). Feel like getting them to withdraw frm this plan

Below are the details that i got

Male, Non-smoker, ANB 60yr old

Prusave Max Limited pay
$5007/yr for 5yrs (Total: $25,034)

Maturity Value (at 70 yr old) - $26,469 (3.25%), $28,685 (4.75%)

 

[SpinFire]

Just curious, why did your parents sign up for this plan in the first place?

The IRR seems too low to be true, could you have calculated wrongly? Is there a cash payout every year?
If the returns are so low, might as well just buy CMT bonds, approx 3% ytm for 7 years

 

[wts2013]

I would prefer to ask my parents to open joint account 0cbc 360 with me to earn up to 3.05%, hahaha. Or put money in CPF which earns higher interest, provided u meet requirements allowing u to withdraw any time, hehehe

 

[FP_IFA]

Terrible return if the number mentioned is correct.

 

[AhPek_Lion]

Just curious, why did your parents sign up for this plan in the first place?

The IRR seems too low to be true, could you have calculated wrongly? Is there a cash payout every year?
If the returns are so low, might as well just buy CMT bonds, approx 3% ytm for 7 years

No cash payout. They signed up when they were out tgt... I didnt know till i came back frm reservist ytd and mother asked me to have a look. When i m back i will write the details here for u to help me recount

 

[AhPek_Lion]

I would prefer to ask my parents to open joint account 0cbc 360 with me to earn up to 3.05%, hahaha. Or put money in CPF which earns higher interest, provided u meet requirements allowing u to withdraw any time, hehehe

Reason why they dont want 360 cos mother dont want spend the $ . Usually they sign with income but got few with them le so better to put eggs into other basket

How abt manulife or TM... Any safe ones with guaranteed capital

 

[wts2013]

Reason why they dont want 360 cos mother dont want spend the $ . Usually they sign with income but got few with them le so better to put eggs into other basket

How abt manulife or TM... Any safe ones with guaranteed capital

no need "spend" still can qualify but cannot talk here. No harm if NTUC is good, mine all there also, then I also shareholder, so works both ways, hahaha, if NTUC can pay more and cheaper why go to another which pays less?

 

[hwmook]

Your calculation is definitely wrong, i have a plan with pru too and the returns are much higher than 0.69%, the 3.25% they quote is already the IRR. You are doing it all wrong.

 

[AhPek_Lion]

Here are the details of the plan

Male, Non-smoker, ANB 60yr old

Prusave Max Limited pay
$5007/yr for 5yrs (Total: $25,034)

Maturity Value (at 70 yr old) - $26,469 (3.25%), $28,685 (4.75%)

If they were to terminate within the free look period will there be any charges incurred?

 

[Aerial86]

Here are the details of the plan

Male, Non-smoker, ANB 60yr old

Prusave Max Limited pay
$5007/yr for 5yrs (Total: $25,034)

Maturity Value (at 70 yr old) - $26,469 (3.25%), $28,685 (4.75%)

If they were to terminate within the free look period will there be any charges incurred?

NTUC Revosave (Pay 5 - 10yrs Term)

$5007/yr for 5yrs (Total: $25,034)

Maturity Value (at 70 yr old) - $28.792 (3.25%), $30,995 (4.75%)

Tried to compare TM for you too but can't meet the minimum requirement. Btw for Pru plan, you might want to take note if $5,007/yr consist of waiver rider or not? Mine is not.

And no, terminating within free-look does not have charges.

Regards,

Alex
Finexis Advisory

 

[tiny]

The IRR is really low, could be a typo error.

 

[AhPek_Lion]

NTUC Revosave (Pay 5 - 10yrs Term)

$5007/yr for 5yrs (Total: $25,034)

Maturity Value (at 70 yr old) - $28.792 (3.25%), $30,995 (4.75%)

Tried to compare TM for you too but can't meet the minimum requirement. Btw for Pru plan, you might want to take note if $5,007/yr consist of waiver rider or not? Mine is not.

And no, terminating within free-look does not have charges.

Regards,

Alex
Finexis Advisory

Thanks Alex. Are there other companies besides NTUC?

For the pru plan, there are no riders attached to this plan. Minimum death benefit is 105% (1st - 4th yr) and 22k from 5th yr onwards, including declared bonuses

 

[AhPek_Lion]

 

[Aerial86]

Thanks Alex. Are there other companies besides NTUC?

For the pru plan, there are no riders attached to this plan. Minimum death benefit is 105% (1st - 4th yr) and 22k from 5th yr onwards, including declared bonuses

Hi I've tried. But TM and NTUC is the only 2 company that I found, which have similar payment term..

My suggestion is if they still want to go ahead with pru, get a CI premium waiver. Endowment make big losses anytime before maturity.

Imagine things happened within this 10yrs and they are not able to sustain the premium anymore.. I will be surprised if the agent did not even mention it to your father.

 

[AhPek_Lion]

Hi I've tried. But TM and NTUC is the only 2 company that I found, which have similar payment term..

My suggestion is if they still want to go ahead with pru, get a CI premium waiver. Endowment make big losses anytime before maturity.

Imagine things happened within this 10yrs and they are not able to sustain the premium anymore.. I will be surprised if the agent did not even mention it to your father.

Thank you for ur help. May i know how to go abt to cancel the policy? Can email or need write in letter form to main pru office.

I will tell my parent abt the NTUC one to see if they are keen.

 

[tommy1432]

My parents just signed up an endowment plan with pru... Premium of 5k/yr for 5yrs.. Mature on 10th year and getting back only 26k+ (3.25%). Equivalent to 0.69% IRR. In addition there is another $600+ payout due to them placing the 25k lump sump at the start? Not very sure abt the details

Still within the free look period. Just wondering if there is any better plans that is capital guaranteed, better returns and short term (10yrs). Feel like getting them to withdraw frm this plan

Below are the details that i got

Why not put into stable dividends account? although no guaranteed, dividends are at around 3% and there are those dividends that have been consistently giving out. endowment at their age unless they don't need the cash locks up the money.

 

[Aerial86]

Thank you for ur help. May i know how to go abt to cancel the policy? Can email or need write in letter form to main pru office.

I will tell my parent abt the NTUC one to see if they are keen.

Actually you could get your father to call the agent or if you want to skip that, call in to Pru cust service. They will guide you from there.

 

[FP_IFA]

Here are the details of the plan

Male, Non-smoker, ANB 60yr old

Prusave Max Limited pay
$5007/yr for 5yrs (Total: $25,034)

Maturity Value (at 70 yr old) - $26,469 (3.25%), $28,685 (4.75%)

If they were to terminate within the free look period will there be any charges incurred?

The irr is not 0.69%, it is 1.71%. It is still bad though. Whats more the guaranteed value is actually less than premium paid so its not even capital guaranteed. I believe there are at least 3 other insurers with better return for this kind of 10-years plan.