PRUDENTIAL SAVINGS SAGA

[OngHuatHuat]

Actually why you refuse to put in protection value for Ssb? Just purchase a term will do.

Even without term, from the example you gave, almost all endowment
Seem beating Ssb return as long as they don't put in a lot of expensive riders.

Main focus for this thread is endowment. People buy endowment coz they want savings + a little bit of protection.

how shld i put it?

let say i have 10k need to park somewhere conservatively for 10years. means no principal lost

10k i put inside ssb vs 10k i put inside endowment

after 10 years, which one return more?

 

[Shion]

Do take note the main focus for this thread is about endowment, not Ssb.

So that product must have endowment elements inside. If don't have, need to use hybrid product to beat.

??

I was asking about the endowment plan...

 

[akwl88]

Actually why you refuse to put in protection value for Ssb? Just purchase a term will do.

Even without term, from the example you gave, almost all endowment
Seem beating Ssb return as long as they don't put in a lot of expensive riders.

Main focus for this thread is endowment. People buy endowment coz they want savings + a little bit of protection.

because term plan is separate from ssb?

means got endowment no need buy term because endowment outperform term in terms of protection?

endowment > term + ssb?

 

[OngHuatHuat]

I just want to emphasize your point by replying to you.

??

I was asking about the endowment plan...

 

[akwl88]

Actually why you refuse to put in protection value for Ssb? Just purchase a term will do.

Even without term, from the example you gave, almost all endowment
Seem beating Ssb return as long as they don't put in a lot of expensive riders.

Main focus for this thread is endowment. People buy endowment coz they want savings + a little bit of protection.

i dont uds why pple want a little bit of protection when they can get MEGA protection from protection plans

 

[OngHuatHuat]

Ern.... I think you start to anyhow replying already.

Anyway, if you want fair comparison, we need to find a product that can beat endowment coz the main focus for this thread is about lousy endowment erodes return.

If want to compare different savings account versus Ssb, should start another thread on Ssb.

If want to beat endowment, that particular product must have endowment elements inside which is saving + protection.

because term plan is separate from ssb?

means got endowment no need buy term because endowment outperform term in terms of protection?

endowment > term + ssb?

 

[OngHuatHuat]

Ai yeah, since so easy to get mega protection from term, just add it to your Ssb cost and see if it can beat endowment lor. Talk so much with me for what

The problem here is even without additional cost to purchase term, Ssb cannot beat most of the endowment plans based on this link:

http://investmentmoats.com/budgetin...ving-plans-endowment-give-you-3-to-5-returns/

The reason is because Ssb supposed to be a very low risk instrument. If you want to beat endowment return, just use another higher yield product and hold to maturity. I don't understand the logic of a must to show Ssb beats endowment.

i dont uds why pple want a little bit of protection when they can get MEGA protection from protection plans

 

[Perisher]

The main focus of this thread is actually about endowment that potentially misled the client resulting in this post of the fb link.

If pure endowment with no riders that is better than SSB, then that is better no?
But that doesn't seem to be the case here no?
With or without the rider, it's not performing the 3-4% is it?
And with the rider, it confuses the buyer.

And why is it that no agent here dare to say endowment is better than SSB when done without riders? What's with the hesitation that yyhwin can say it? With examples from kyith's blog?

Are the plans more than 70% better? Which is to mean that any most random endowment can perform better than SSB?

Why can't a plan with investment element state up front that,
'This policy may result in no gains at all or losses on capital over the long term.'?

Put that up and there will be less controversies. It benefits everyone.

And I gotta say kyith's blog shows better evidence than any agent here with their tons of words.

 

[koja6049]

The main focus of this thread is actually about endowment that potentially misled the client resulting in this post of the fb link.

If pure endowment with no riders that is better than SSB, then that is better no?
But that doesn't seem to be the case here no?
With or without the rider, it's not performing the 3-4% is it?
And with the rider, it confuses the buyer.

And why is it that no agent here dare to say endowment is better than SSB when done without riders? What's with the hesitation that yyhwin can say it? With examples from kyith's blog?

Are the plans more than 70% better? Which is to mean that any most random endowment can perform better than SSB?

Why can't a plan with investment element state up front that,
'This policy may result in no gains at all or losses on capital over the long term.'?

Put that up and there will be less controversies. It benefits everyone.

And I gotta say kyith's blog shows better evidence than any agent here with their tons of words.

simple answer: because there is no such endowment without riders offered anymore. The one posted on the uob life guaranteed endowment, I see the BI I would buy in an instant. But that was in the 90s.

 

[Perisher]

simple answer: because there is no such endowment without riders offered anymore. The one posted on the uob life guaranteed endowment, I see the BI I would buy in an instant. But that was in the 90s.

So are we expecting the clients to be able to pick the best policies that can potentially beat SSB over the long term?
Are the odds good enough that they should sacrifice capital guaranteed+returns to go for it?
And are there even such plans these days?

Why doesn't insurance agents all provide SSB as an alternative?
SSB is just the minimum to beat. It's not the be all and end all. If a plan can't even beat it, why bother?

 

[Lewis.T]

The main focus of this thread is actually about endowment that potentially misled the client resulting in this post of the fb link.

If pure endowment with no riders that is better than SSB, then that is better no?
But that doesn't seem to be the case here no?
With or without the rider, it's not performing the 3-4% is it?
And with the rider, it confuses the buyer.

And why is it that no agent here dare to say endowment is better than SSB when done without riders? What's with the hesitation that yyhwin can say it? With examples from kyith's blog?

Are the plans more than 70% better? Which is to mean that any most random endowment can perform better than SSB?

Why can't a plan with investment element state up front that,
'This policy may result in no gains at all or losses on capital over the long term.'?

Put that up and there will be less controversies. It benefits everyone.

And I gotta say kyith's blog shows better evidence than any agent here with their tons of words.

I don't say it because I don't compare the two. You just should not be doing that in the first place. They serve different purposes.

 

[Perisher]

I don't say it because I don't compare the two. You just should not be doing that in the first place. They serve different purposes.

Why can't it be compared? In what ways are they serving very very different purposes?

 

[Lewis.T]

Why can't it be compared? In what ways are they serving very very different purposes?

For starters the SSB is for the ultra conservative, and may have a fixed goal and projection in mind. Time horizon of a maximum of 10 years hampers the reinvestment ability with step up interest. At certain time horizons, it may be more prudent to stick it in a FD for better returns. This is quite a complicated process to determine when would be better to reinvest and when would be better to leave it in a FD for the uninitiated.


An endowment is sort of the middle-ground, where your capital can be impervious to any negative market changes, but also lets you ride on the upside. Just not as much as you would if you DIY because of the insurer taking a part of the upside. Convenience is arguably the easiest, you meet the agent at your preferred time and location, you spend an hour or so and you're done for the entire policy lifetime actually. You can choose not to meet the agent again afterwards.



And while we're on the topic of Kyith, I found this comment made by him

Now i sound like the insurance agent defender haha. I think i look at it this way. You bring up the returns are small when it comes to real returns. I would say lets establish this baseline. Most are risk adverse and do not have a good idea how to work with volatility in their wealth building plan. If you agree on me on that, the amount of available easy to understand instruments are constraint.

I took some time to find an instrument to help readers and friends to AT LEAST take action first. I came up with 2: Endowments and STI ETF. Why? No one have heard of how preference shares, SGS bond how they work, so this SSB is a good thing in that 1. at least i know its fundamentally sound, 2. they have heard of.

But if you look across the board almost all of them provide poor real returns! even SSB if we are to back date.

The challenge to provide a solution for the mass market who do not read, equip themselves with wealth building skillset and yet fundamentally sound is very great i feel (do let me know what is your solution to this i am willing to explore)

I guess your gripe is the unknown cost in the black box. i am philosphical in that, i am an advocate that a large part of your returns is controlling or being very harsh in minimizing cost since cost compounds. But when we look at the IRR of something that projects 5% but gives 3.5% after cost its not too bad. If you ask kyith is this good enough for him. NO. Kyith knows this black box and he is very uneasy about this.

But some poison are a necessary evil.

I really thank you for your point of view. it shifts my idea on these subjects.

Edit: English

 

[havetheveryfun]

Why doesn't insurance agents all provide SSB as an alternative?
SSB is just the minimum to beat. It's not the be all and end all. If a plan can't even beat it, why bother?

the summary so far from this thread (why endowment better than SSB):

- For endowment, you can put aside few hundreds every month compared to dumping it all at one go. also a kind of forced savings.
- For endowment, in the event if you die, you can get back a little bit more money for you loved ones.
- For endowment, if you manage to purchase the right one, the returns can be 2 times or more of what SSB can give (4% + yield).

any more ?

 

[OngHuatHuat]

http://investmentmoats.com/budgetin...ving-plans-endowment-give-you-3-to-5-returns/

As long as you don't choose that particular lousy endowment, almost all able to beat Ssb.

the summary so far from this thread (why endowment better than SSB):

- For endowment, you can put aside few hundreds every month compared to dumping it all at one go. also a kind of forced savings.
- For endowment, in the event if you die, you can get back a little bit more money for you loved ones.
- For endowment, if you manage to purchase the right one, the returns can be 2 times or more of what SSB can give (4% + yield).

any more ?

 

[havetheveryfun]

An endowment is sort of the middle-ground, where your capital can impervious to any negative market changes, but also lets you ride on the upside. Just not as much as you would if you DIY because of the insurer taking a part of the upside.

That's the ideal scenario but most of the times it doesn't happen. Just like in this case, Prudential used the 3 major financial crises as their argument... his capital where got impervious to negative market changes ? More like the insurer takes most of the upside while sharing with the client the downsides.

 

[havetheveryfun]

http://investmentmoats.com/budgetin...ving-plans-endowment-give-you-3-to-5-returns/

As long as you don't choose that particular lousy endowment, almost all able to beat Ssb.

and none of it is from Prudential.... so far, a lot of complaints about policies and agents seem to have mostly come from Prudential..

 

[Perisher]

For starters the SSB is for the ultra conservative, and may have a fixed goal and projection in mind.

An endowment is sort of the middle-ground, where your capital can be impervious to any negative market changes, but also lets you ride on the upside. Just not as much as you would if you DIY because of the insurer taking a part of the upside.

And while we're on the topic of Kyith, I found this comment made by him



Edit: English

I think that's over-complicating things for common folks. Don't you think?
The capital isn't impervious depending upon which plans, some I believe don't cover 100% no?

The ride on the upside can result in 20 years of 0 gain unless you pick the right plan? If you ask the common folks are they willing to sacrifice 20 years and earn nothing vs one which is guaranteed to earn something, I think they would have pick the latter mostly. This is also where most issues came from if you notice. The part where they get nothing after 20 years unless they pick the right plan.

Why can't insurance company put that part in all the first page of their policy with any investment element?

It sure will benefit both sides and cut down any issues no?

The difference you mentioned is just the returns. Basically saying their returns difference with one(endowment) potentially having nothing over 20 years or more while the other(SSB) having the in-between by having guaranteed returns over 10 years.

What other difference is there that makes it so hard to compare?

Do you know what clients really wanted if you put those words up front to them? The bolded parts.

 

[akwl88]

Ern.... I think you start to anyhow replying already.

Anyway, if you want fair comparison, we need to find a product that can beat endowment coz the main focus for this thread is about lousy endowment erodes return.

If want to compare different savings account versus Ssb, should start another thread on Ssb.

If want to beat endowment, that particular product must have endowment elements inside which is saving + protection.

Are there any endowments with 500k protection?

 

[OngHuatHuat]

Ern, you can try find out prudential return if you want. But based on my experience with them for that limited pay life insurance, they are able to give the lower projected rate of return up to date.
Got 2 projected rate of return, 3.75 % and 5.25 %.
My current surrender value is very close to the middle value.
Predicted :
6th year
3.75 % = 12196
5.25 % = 12851

My current surrender value:

and none of it is from Prudential.... so far, a lot of complaints about policies and agents seem to have mostly come from Prudential..