ILP Funds

[matchy]

I bet your agent don't tell you the HUGE SPREAD involved. Compare it with stocks and you would see how CARROT ilp can be.


For instance, the bid/sell for Greatlink Asean Growth is S$ 2.563/S$ 2.697. Compare it with a stock, say Singtel $2.31/$2.32. Look at how much fund manager and insurance agents are sucking the commission! Holy...

by saying this sentence...i guaranteed something, that no one share with u the loophole

 

[ochazuke]

I too bought an ILP with Manulife back in 2007. Really regret now... I was young that time and just started work, didn't do my research properly.

Still have not broken even, I'm really unsure if I should wait another 5+ years to hit 10 years in hopes it will break even.

What i did to minimise the pain was to reduce my premiums to a much smaller sum.

 

[bbmars1128]

I too bought an ILP with Manulife back in 2007. Really regret now... I was young that time and just started work, didn't do my research properly.

Still have not broken even, I'm really unsure if I should wait another 5+ years to hit 10 years in hopes it will break even.

What i did to minimise the pain was to reduce my premiums to a much smaller sum.

You have to decide and no one can decide for you. There was an article last Sunday on Sunday Times and it mentioned about investment in stocks some 40 years ago. quoted a few stocks and also mentioned that certain stock, since 40 yrs ago, not much changes or even behind current price. Some good ones but gone sour, etc.... something like that. ... success of yester-year does not mean current success.

 

[The_Davis]

wrong. I managed to cash out for my parents within one year with profit.

buy unit trust need 10years to breakeven???

buy from poems 1-3 month can break even, 1 year earn 3-10% already

buy from insurance ILP 3-4 years still 30-40% in the red

 

[ochazuke]

buy from poems 1-3 month can break even, 1 year earn 3-10% already

buy from insurance ILP 3-4 years still 30-40% in the red

in my 5th year now... same about 50% in the red. super sucks

 

[lousylah]

in my 5th year now... same about 50% in the red. super sucks

cut loss, free the money for other purpose and move on with life - of course please ensure you are sufficiently insured before doing anything.

quoting myself from another thread about ILP:

holding on to your policy in the hope of breaking even is like digging yourself a bigger hole.

assuming your annual premium is 6k and you say your cash value is 50% so 24k. Say at 10 years your value improves by 10% so how much are you behind? 60k*0.4=24k

even if it improves by 20% you are still 18k behind (60k*0.3). so 5 years and 30k more in premium helped you "recover" 6k. worth it? if you understand the concept of opportunity cost then you know it is an absolute waste of time.

...

even if you finally break even at 15 years you would have spent 10 years and 60k more more to achieve it. take into account inflation and you're still screwed.

i've said many times in this forum, the money in an FD or CPF would have given better returns. the only one who gains with ilp is the agent (commission).

my usual advice is stop-loss, take the cash value and put it to better use. take the loss as a lesson learnt.

good luck!

shortened and parts in red edited to match your case.

 

[matchy]

those in red...pls feel free to come to me...let me show u the secret to ILP

 

[bloodsucker]

those in red...pls feel free to come to me...let me show u the secret to ILP

How about you let everyone here know your secret? I would suppose many of us here are equally or more well-versed with the financial engineering and actuarial concepts behind ILPs. And it is just that. If your secret is to pump in money (recurrent single premium or otherwise), its a pathetic plan just to let you know.

Its like doubling down on your gambling bets in the casino.

I wouldn't recommend anybody out there to listen to this fella. He is almost certainly an agent out to get your sale.

 

[SpinFire]

in my 5th year now... same about 50% in the red. super sucks

Coz almost 1.5 years of premium went to the insurance agent as commissions. My Dad has an ILP for almost ten years, and recently just about to break even only. If its not for the high commissions, it's slightly profitable now.

 

[MaoZeDuo]

Can i ask some questions here?

I see a lot of guys here wanna give up their ILP during the 10th or even the 5th year.

1. What makes u think that breakeven WILL come that early?

It seems like u guys are looking out for PROFITS.

2. Are u not aware that ILP's purpose is to provide u a lower cost with higher coverage in the earlier years (and hence will benefit more for youngster)? And probably a potential return for u in the later years where u can still cash it out?

3. Have u guys noticed most BI only starts to breakeven at the 20th policy year?

 

[ochazuke]

Can i ask some questions here?

I see a lot of guys here wanna give up their ILP during the 10th or even the 5th year.

1. What makes u think that breakeven WILL come that early?

It seems like u guys are looking out for PROFITS.

2. Are u not aware that ILP's purpose is to provide u a lower cost with higher coverage in the earlier years (and hence will benefit more for youngster)? And probably a potential return for u in the later years where u can still cash it out?

3. Have u guys noticed most BI only starts to breakeven at the 20th policy year?

I think the point is that if a person does not need the coverage (as he already has other insurance arrangements), then wouldn't such funds be better placed elsewhere due to the high management / admin fees of an ILP?

As an example, I know of a person who paid $15,000 in premiums over 5 years, and the surrender value as at today's date is less than $5,000. Don't know when that will ever break even, if ever.

 

[ochazuke]

cut loss, free the money for other purpose and move on with life - of course please ensure you are sufficiently insured before doing anything.

quoting myself from another thread about ILP:



shortened and parts in red edited to match your case.

Thanks for the insight. Still considering.

 

[MaoZeDuo]

I think the point is that if a person does not need the coverage (as he already has other insurance arrangements), then wouldn't such funds be better placed elsewhere due to the high management / admin fees of an ILP?

As an example, I know of a person who paid $15,000 in premiums over 5 years, and the surrender value as at today's date is less than $5,000. Don't know when that will ever break even, if ever.

i believe thats e problem. only 5 years and looking to breakeven. e objective is wrong initially already. if ur fren here is looking into investment in e first place, he shld go for other alternatives.

i believe every plan cater to different needs. for eg. some ppl ai pee ai qi. want coverage and want take back money. thats why got ILP. so that at least in the later years, u can give up the plan for some cash. unlike term.

imho

 

[bloodsucker]

Can i ask some questions here?

I see a lot of guys here wanna give up their ILP during the 10th or even the 5th year.

1. What makes u think that breakeven WILL come that early?

It seems like u guys are looking out for PROFITS.

2. Are u not aware that ILP's purpose is to provide u a lower cost with higher coverage in the earlier years (and hence will benefit more for youngster)? And probably a potential return for u in the later years where u can still cash it out?

3. Have u guys noticed most BI only starts to breakeven at the 20th policy year?

ILP might provide a lower-cost coverage even compared to term when you are looking at mortality charge. HOWEVER, the way the companies impose charges and the way the allocate premium to the units, you are losing out big time. If you wanna buy ILP for protection purpose, I think its not a very good proposition as you are paying about $100/mth even for the lowest coverage, when you can get $100k term for about $10 or less. Any form of self-investment will most probably beat ILP.

I think ILP is a pathetic product, period. Its bad as protection as term is cheaper overall. Its bad as investment compared to anything else (other than Gold Guarantee and Genneva). If its not good for anything, why hold it?

 

[MaoZeDuo]

ILP might provide a lower-cost coverage even compared to term when you are looking at mortality charge. HOWEVER, the way the companies impose charges and the way the allocate premium to the units, you are losing out big time. If you wanna buy ILP for protection purpose, I think its not a very good proposition as you are paying about $100/mth even for the lowest coverage, when you can get $100k term for about $10 or less. Any form of self-investment will most probably beat ILP.

I think ILP is a pathetic product, period. Its bad as protection as term is cheaper overall. Its bad as investment compared to anything else (other than Gold Guarantee and Genneva). If its not good for anything, why hold it?

Hmm. ILP is there for a reason. In fact it is regulated, if not it wont even exist. I think many different ppl have different opinions. But comparing between term, ilp or even wholelife is like comparing apple to orange. Like i said in my previous post, its for ppl who wanna see some cash with e benefit of protection and without lapsing it. Hence i still believe it has its use. Thats where it is e duty of agents to provide professional advice pertaining to e potential risk and how to "fix" e higher costs at old age.

If u have your ways to increase ur wealth via ur own investment methods, obviously we cant deny that ilp would be pretty not "usable" for chiu where u can jus hamtum term plans for protection. But not all are so savvy. Correct ma?

 

[MaoZeDuo]

Thanks for the insight. Still considering.

ocha.. i think u shld speak to ur agent leh. see what can be done (except pumping $), mayb compare the BI see if ur cash value now is somewhere near e projections. If so means its in good course. Otherwise u can always reduce e sum assured so that at least, u keep e plan going. otherwise very wasted eh.

but then again, if keep fan nao cos u are very tight on hand until cannottttt tahan liao because of this bloody piece of insurance policy, then u shld consider dropping it.

 

[bbmars1128]

Hmm. ILP is there for a reason. In fact it is regulated, if not it wont even exist. I think many different ppl have different opinions. But comparing between term, ilp or even wholelife is like comparing apple to orange. Like i said in my previous post, its for ppl who wanna see some cash with e benefit of protection and without lapsing it. Hence i still believe it has its use. Thats where it is e duty of agents to provide professional advice pertaining to e potential risk and how to "fix" e higher costs at old age.

If u have your ways to increase ur wealth via ur own investment methods, obviously we cant deny that ilp would be pretty not "usable" for chiu where u can jus hamtum term plans for protection. But not all are so savvy. Correct ma?

They may be there for a reason, but that reason is not very clear cut now given the market condition over the past decade. When I bought ILPs (2 of them using CPF), I was afraid to do my own investment and rely on such product at the same time, I get coverage. At that time, I didn't know how to do it and I see ILP as one such way of investing and do not mind the coverage becayse it was the extra, it was part of the investment plan. Although it isn't anything I would be proud of, but agent say at least cover in case of anything.

however, over the years as I begin to see my investment getting more RED.. I begin to wonder and there were things that were not told to me too. Slowly as I started to wake up and learn my lessson, I figured that there was no need for the insurance part because I have to pay for it along with other deduction which was not told to me, and never my initial intention. Breakeven? Those funds which I invested till today have yet to reach its peak (guess that's when I entered) and its been some 14 yrs now,I don't even need to look at the chart to tell me that if I hold on to it, it is still in the red. Sold it away on 7-8yrs after holding, lost 16K. LOST 40%. Given that kind of figure, how to recover?

However, after I withdraw my policies, I re-invest those $$ and making even more. I was not interested in coverage when I bought, just that I thought those are so-call experts who watch over my investment and do the job for me to make more $$$ for retirement..... didn't expect.... it to turn out that way. Just put it that way, depending on when you enter the market, otherwise, it you end up like myself, still loosing. Even if I don't use those cancelled ILP funds for re-investment, I will still be earning CPF interest. I still win.

CPF statistic over the years, majority who invest CPF $$ end up looser. More are making LOST than profit. The last report, can't recall but was few years back, most were loser but I was one of the minority that make from CPF investment. It also commented over the years, it would have been better for many not investing and but earn CPF interest pver certain period of time. quite some years as pointed out. Perhaps, ILP may not be relevant for those who wants to invest but not for coverage. For someone who does not own any coverage, that may be good, but for what purpose?
I had actually asked my agent before I bought because the coverage does not look attractive at all to me but was told it was part of it. that's why no choice, end up buying.. but found out the hard how the policy unfold.... = LOST $$$

 

[ochazuke]

ocha.. i think u shld speak to ur agent leh. see what can be done (except pumping $), mayb compare the BI see if ur cash value now is somewhere near e projections. If so means its in good course. Otherwise u can always reduce e sum assured so that at least, u keep e plan going. otherwise very wasted eh.

but then again, if keep fan nao cos u are very tight on hand until cannottttt tahan liao because of this bloody piece of insurance policy, then u shld consider dropping it.

Thanks for the input. I just called my agent to ask him to review and make suggestions, probably will be arranging to have kopi with him soon. Earlier on in my 3rd year I already reduced the premium to the minimum already so as to make it less painful, but to keep the plan going .

 

[bloodsucker]

Thanks for the input. I just called my agent to ask him to review and make suggestions, probably will be arranging to have kopi with him soon. Earlier on in my 3rd year I already reduced the premium to the minimum already so as to make it less painful, but to keep the plan going .

Lol after your agent intro u another plan then u know. Good luck bro. U save money here but spend money on another useless product

 

[MaoZeDuo]

Lol after your agent intro u another plan then u know. Good luck bro. U save money here but spend money on another useless product

Scared of what? U already warned him le ma. Barriers up.