PRUDENTIAL SAVINGS SAGA

[Perisher]

Oh, ok. So it's about 4% returns until the year 2000, that's excellent. What happens after that? Why TS's fb post is showing otherwise of a prudential endowment policy?

 

[Perisher]

http://www.sgs.gov.sg/savingsbonds/Your-SSB/This-months-bond.aspx

SSB this month bond. Average 2.32% per year.
I will use this figure and project it over 20 years(I think that interest rate if for 10 years, but that isn't 20 years SSB available).

yup, 10 years max.

 

[OngHuatHuat]

So is that averaged or is that all endowment policies return? meaning everyone who get a 20 year policy get that returns?

You are just trying to prove SSB wins endowment here by saying most endowment are lousy.
But the actual fact is, my relatives' experience, data you can find online, or even prudential official data suggests that actual yield is around 3-4 % per annum. Prudential one caught me by surprise by producing more than 4% actually. It is very rare to see under 3 % unless you are talking about policies with cashback option.

 

[Lewis.T]

You are just trying to prove SSB wins endowment here by saying most endowment are lousy.
But the actual fact is, my relatives' experience, data you can find online, or even prudential official data suggests that actual yield is around 3-4 % per annum. Prudential one caught me by surprise by producing more than 4% actually. It is very rare to see under 3 % unless you are talking about policies with cashback option.

Not sure about data I can find online.. can't seem to find much lol.

 

[Perisher]

You are just trying to prove SSB wins endowment here by saying most endowment are lousy.
But the actual fact is, my relatives' experience, data you can find online, or even prudential official data suggests that actual yield is around 3-4 % per annum. Prudential one caught me by surprise by producing more than 4% actually. It is very rare to see under 3 % unless you are talking about policies with cashback option.

Nope, I'm not interested in proving which is better. More interested in scrutinizing both sides.

And don't need random stories as I need to know why some endowments are not performing as per TS's FB post? Actual stats helps to understand the whole story. Not some friends of friends example.

 

[Lewis.T]

Anyway here's a good example.

http://www.chinalife.com.sg/chinalife/en/products/pdfs/CLI SaveReward 101 Series II Bro Eng.pdf

Guaranteed 2.25% interest and capital for a 3 pay 5 year endowment. Usually such products are limited tranche.

Think nothing much to discuss about this one, it just flat out beats an SSB in all aspects except liquidity.

 

[Perisher]

Not sure about data I can find online.. can't seem to find much lol.

Why no data after year 2000?
Can request from your company?

 

[akwl88]

Anyway here's a good example.

http://www.chinalife.com.sg/chinalife/en/products/pdfs/CLI SaveReward 101 Series II Bro Eng.pdf

Guaranteed 2.25% interest and capital for a 3 pay 5 year endowment. Usually such products are limited tranche.

Think nothing much to discuss about this one, it just flat out beats an SSB in all aspects except liquidity.

5 yr for 2.25%

why u not selling this instead of your earlier useless plan?

 

[Lewis.T]

But as always past performance is not an indicator of future performance. This includes insurers.

If you think the market is going sideways then SSB is going to be better for hedging.

 

[Lewis.T]

5 yr for 2.25%

why u not selling this instead of your earlier useless plan?

Do I sound like I represent Chinalife?

So quick to determine that the policy I showed is useless too. Sigh.

 

[akwl88]

Do I sound like I represent Chinalife?

means you dont have anything similar?

goes back to the point that agents pushes their own products because of commissions

alr compare the guaranteed returns liao

what more you want? sigh.

 

[Lewis.T]

means you dont have anything similar?

goes back to the point that agents pushes their own products because of commissions

alr compare the guaranteed returns liao

what more you want? sigh.

? Your argument always shifts to suit your motive. All the while I have been arguing that endowments have their place, nothing to do with incentives or commissions.

 

[Lewis.T]

Limited tranche policy I sold last year.

 

[akwl88]

? Your argument always shifts to suit your motive. All the while I have been arguing that endowments have their place, nothing to do with incentives or commissions.

what motives?

i present to you the truths and facts with calculations

i didnt even dispute the chinalife 5 year 2.25% yield too

so pls do not peddle useless products out there

 

[akwl88]

Limited tranche policy I sold last year.

1.5% guaranteed only?

 

[Mancunian2]

Limited tranche policy I sold last year.

worse than FD in the 1st - 4th year,
no better than FD at the end of 5 years

and sum assured $5k, what value does it add?

this has all the hallmarks of a crap (scam) product

I can close one eye and easily create a synthetic (term insurance + Preference share or high grade corp bond) combination that beats both the investment returns and insured amount

and I get to retain liquidity

 

[OngHuatHuat]

Nope, I'm not interested in proving which is better. More interested in scrutinizing both sides.

And don't need random stories as I need to know why some endowments are not performing as per TS's FB post? Actual stats helps to understand the whole story. Not some friends of friends example.

I will prove to you why SSB + term is very easy to beat by my calculations here. All hard figures:

First diagram :
20 years SSB return with compound interest of 2.3% with and without deducitons of 99 per annum to account for term.

Second diagram, compound interest at 2.3% to show the calculator result is somewhat similar to what I get from excel:

Start at year 1, yearly addition of 2800 for 19 years.

Third diagram, to show the effective interest rate after account for deductions, i try to estimate the interest rate needed to generate similar end result for 2800 yearly addition, 2.3% compound with deduction.
Effective interest rate was found out to be around 1.98 to 2% only.

 

[soneat]

Urmm...you guys are taking things a bit too personally. I think it would be better to have a sticky thread to list down clearly the pros and cons for Endowment, SSB, Term Life, Whole Life, BTITR, ILP.

IMHO, although endowment is not as good as we want it to be, it is still popular with generally older or female as endowment are perceived to be safer. Also, there are also people who have maxed out their CPF MA/SA and contributed to SRS for years and choose to buy Income's SAIL (Single Premium Endowment), again these people are very risk adverse and don't mind low returns. There are also some endowment with decent guaranteed values (e.g. Aviva's My Wealth something...cant remember which I posted previously) of about 2% (guaranteed).

If let's say a person has decided to buy a term or endowment or shield plan, wouldn't it be better to list down the things to advice him/her to watch out for rather than making sweeping statements? 10 years down the road, if prevailing 10Yr-SSB falls to 0.8%, would there be a thread "HWZ Money Mind Advice SAGA"?

 

[Lewis.T]

what motives?

i present to you the truths and facts with calculations

i didnt even dispute the chinalife 5 year 2.25% yield too

so pls do not peddle useless products out there

But that policy is an endowment, and according to you,

Endowments are useless
http://forums.hardwarezone.com.sg/107455675-post578.html
SSB wins endowments hands down
http://forums.hardwarezone.com.sg/107441004-post564.html
Insurance agents, and by affiliation, endowments are scams
http://forums.hardwarezone.com.sg/107436132-post519.html
Endowments are a useless product
http://forums.hardwarezone.com.sg/107406569-post443.html

etc etc.

Why so inconsistent?

 

[Perisher]

Urmm...you guys are taking things a bit too personally. I think it would be better to have a sticky thread to list down clearly the pros and cons for Endowment, SSB, Term Life, Whole Life, BTITR, ILP.

IMHO, although endowment is not as good as we want it to be, it is still popular with generally older or female as endowment are perceived to be safer. Also, there are also people who have maxed out their CPF MA/SA and contributed to SRS for years and choose to buy Income's SAIL (Single Premium Endowment), again these people are very risk adverse and don't mind low returns.

If let's say a person has decided to buy a term or endowment or shield plan, wouldn't it be better to list down the things to watch out for rather than making sweeping statements?

Need approvals for such stickies. Requested for insurance before but rejected.