Retirement vs Wealthbuilder ?

[hogrider88]

For someone 30 who has WL, adequate term coverage and hosp plan in place, what is the better option nxt? Retirement planning?

I invest in the stock market long term but i think it is also gd to set aside something "safe" for retirement, on top of investments.

From what i know, retirement hv to pay until 55/60/65 then can receive annuities.. Usually guaranteed abt 2% or less.. Non-guaranteed up to 4%

Wealthbuilder pay for 20 yrs, afterwhich can take out anytime, or leave it until retirement for interest to "roll", more flexibility.

I do not think endowment is a gd plan compare to above as i think alot of fees r paid twds the " coverage" portion?

What is ur choice??

 

[Shiny Things]

For someone 30 who has WL, adequate term coverage and hosp plan in place, what is the better option nxt? Retirement planning?

I invest in the stock market long term but i think it is also gd to set aside something "safe" for retirement, on top of investments.

From what i know, retirement hv to pay until 55/60/65 then can receive annuities.. Usually guaranteed abt 2% or less.. Non-guaranteed up to 4%

Wealthbuilder pay for 20 yrs, afterwhich can take out anytime, or leave it until retirement for interest to "roll", more flexibility.

I do not think endowment is a gd plan compare to above as i think alot of fees r paid twds the " coverage" portion?

What is ur choice??

All of those other plans you're talking about have high fees as well - whether it's an ILP or an endowment plan or a whole-life plan.

If you're looking for a "safe" investment, then you should look at government bonds - either Singapore Savings bonds, or the A35 ETF that invests in a big lump of government and GLC bonds.

 

[wts2013]

2 articles for your reading pleasure, in case u missed it, published in Sunday Times last weekend:

http://www.straitstimes.com/business/retiring-rightand-picking-a-plan-that-fits-you

http://www.straitstimes.com/busines...-plan-for-greater-certainty-and-peace-of-mind


Care to share more about the wealthbuilder, any links to insurer/co providing this?

 

[Mecisteus]

For someone 30 who has WL, adequate term coverage and hosp plan in place, what is the better option nxt? Retirement planning?

I invest in the stock market long term but i think it is also gd to set aside something "safe" for retirement, on top of investments.

From what i know, retirement hv to pay until 55/60/65 then can receive annuities.. Usually guaranteed abt 2% or less.. Non-guaranteed up to 4%

Wealthbuilder pay for 20 yrs, afterwhich can take out anytime, or leave it until retirement for interest to "roll", more flexibility.

I do not think endowment is a gd plan compare to above as i think alot of fees r paid twds the " coverage" portion?

What is ur choice??

just leave your OA and SA untouched. top them up if you have not reached the ceiling. this is one of the safest and best retirement accounts with good interest rates.

 

[hogrider88]

For cpf, we can only withdraw when we are 65, and we dun hv option to withdraw lumpsum, but only annuity. What if 30 yrs later, withdrawal age becomes 70, or 75?

I consider retirement plan cuz i want sth at maybe 55, or 60?

I hv iwda/sti/a35 right now too. But what if between 55-60 of age, there is an economic crisis, and it is not "ideal time" to start withdrawing the portfolio for retirement ?

 

[hogrider88]

2 articles for your reading pleasure, in case u missed it, published in Sunday Times last weekend:

http://www.straitstimes.com/business/retiring-rightand-picking-a-plan-that-fits-you

http://www.straitstimes.com/busines...-plan-for-greater-certainty-and-peace-of-mind


Care to share more about the wealthbuilder, any links to insurer/co providing this?

Something like those:
Tokiomarine wealth enhancement
Aviva mywealth plan
Pruwealth

 

[Soul77]

For cpf, we can only withdraw when we are 65, and we dun hv option to withdraw lumpsum, but only annuity. What if 30 yrs later, withdrawal age becomes 70, or 75?

I consider retirement plan cuz i want sth at maybe 55, or 60?

I hv iwda/sti/a35 right now too. But what if between 55-60 of age, there is an economic crisis, and it is not "ideal time" to start withdrawing the portfolio for retirement ?

That's why as you age, you'll want to increase the A35 portion. So if you follow 110-age rule, by the time you're 60 years old, A35 should be 50% of all your money.

Even though there is financial crisis, this shouldn't drop too much (only drop around 5-8% and recover very fast during 2008 crisis)

 

[donald83]

For cpf, we can only withdraw when we are 65, and we dun hv option to withdraw lumpsum, but only annuity. What if 30 yrs later, withdrawal age becomes 70, or 75?

I consider retirement plan cuz i want sth at maybe 55, or 60?

I hv iwda/sti/a35 right now too. But what if between 55-60 of age, there is an economic crisis, and it is not "ideal time" to start withdrawing the portfolio for retirement ?

I have the exact same thought as you. Want something that i can invest regularly and then get an annuity at 55/60 etc.

 

[limster]

TS already says he is buying shares so he knows something about investments. He is still asking for recommendations for products from insurance companies.

For many HNW or 'mass affluent', getting some wealth protection is very important even at the cost of lower return.

When you reach a certain net worth, unless you are really a gambler mindset, you will not be 100% equities. Instead, you will be holding quite a lot of cash and wondering whether there are safe products that can give return>cash. (12 mths family expenses may be quite different amounts for people with different net worth..)

TS did not say that this will be the core of his portfolio. Most likely, he wants to move his spare cash or fixed deposit portion to something 'safe' that will return more than cash/fixed deposit. He may even value relationships and don't mind giving his RM/IFA some business.


Reading the various posts, I can sense those who have already reached a certain level of net worth and wealth protection (with lower but positive return) is important, and those "huat ah!", "all in" mindset which is, people with not much money but want to strike rich, or the higher net worth with gambler mindset.

 

[knightdreamer]

Erm cool down guys...

There are pro and cons for both policy.

Why no one mention the age when you buy?? Over here ( this forum) the age should be >25 and most are investing therefore will view WL as "not worth" as compare to Term. The money 'save' can have better return.

If a person maybe < 20 buy WL pay for 10 years. By the age of 55, compound interest should break even the premium paid or slightly more.( need to work out the figures)

Let's keep a positive discussion

 

[anfielder]

TS already says he is buying shares so he knows something about investments. He is still asking for recommendations for products from insurance companies.

For many HNW or 'mass affluent', getting some wealth protection is very important even at the cost of lower return.

When you reach a certain net worth, unless you are really a gambler mindset, you will not be 100% equities. Instead, you will be holding quite a lot of cash and wondering whether there are safe products that can give return>cash. (12 mths family expenses may be quite different amounts for people with different net worth..)

TS did not say that this will be the core of his portfolio. Most likely, he wants to move his spare cash or fixed deposit portion to something 'safe' that will return more than cash/fixed deposit. He may even value relationships and don't mind giving his RM/IFA some business.


Reading the various posts, I can sense those who have already reached a certain level of net worth and wealth protection (with lower but positive return) is important, and those "huat ah!", "all in" mindset which is, people with not much money but want to strike rich, or the higher net worth with gambler mindset.

Nobody in their right mind would recommend 100% equities. It should be a equity/fixed income mix.

Btw, all these insurance plans also invest the policyholder funds in a equity/fixed income mix. Different proportions for different plans, I would think, plus insurance thrown in.

 

[limster]

Nobody in their right mind would recommend 100% equities. It should be a equity/fixed income mix.

Yet, there are several people active in this forum who are 'all in' with 100% equities and their idea of diversification is buying 3 different shares. Now with sgxcafe you can see their portfolios.

These are the people who are saying Whole Life insurance no good, yet ironically these are the people who most need something with a surrender value should their investments blow up

 

[akwl88]

Yet, there are several people active in this forum who are 'all in' with 100% equities and their idea of diversification is buying 3 different shares. Now with sgxcafe you can see their portfolios.

These are the people who are saying Whole Life insurance no good, yet ironically these are the people who most need something with a surrender value should their investments blow up

They dont have emergency funds,insurance, cpf,bonds etc?

If all their money are 100% in equities, i will agree with you whole heartedly that it is dangerous.

 

[anfielder]

Yet, there are several people active in this forum who are 'all in' with 100% equities and their idea of diversification is buying 3 different shares. Now with sgxcafe you can see their portfolios.

These are the people who are saying Whole Life insurance no good, yet ironically these are the people who most need something with a surrender value should their investments blow up

Oh please, the vast majority of those who advocate against whole life do not espouse such extreme views.

 

[FP_IFA]

Something like those:
Tokiomarine wealth enhancement
Aviva mywealth plan
Pruwealth

1. Tokiomarine Wealth Enhancement
- This is a cashback plan. Are you retiring soon? If not why get a cashback plan at this age?

2. Aviva Mywealth plan
- An endowment plan NOT a retirement plan. The payout is one lumpsum. It is a good endowment plan if your maturity period is between 10 to 15 years. Anything above you can look at TM NestEgg.

3. PruWealth
- No idea as don't have access to it.

 

[Mecisteus]

my rules of thumb are

<1M you can stick with stocks and ETFs (assuming you leave OA/SA untouched)

1-2M you can go for stocks and bonds

>2M you can go for stocks, bonds, properties

majority of singaporeans are the 1st group. they also probably have large amount of OA in HDB.

 

[hogrider88]

limster, i am nt sure whether valuing rship then give biz to fa/rm is a gd idea, does anyone do that? I repented 5 yrs for signing an ILP frm an ex classmate, which i eventually cancelled. So nw i trust n rely my own research, therefore seeking neutral views.

I guess i created a thread for another war-ground, but i value constructive debates.

The 3 plan i quoted (tm wealth, aviva myweatlh, pruwealth) are savings product i thought to be compared against retirement plan like aviva myretirement, axa retire happy etc. annuities. I am nt retiring, but isnt starting early something that is adviced by fa?

Many suggests a35 too - abt 2% yield excluding capital gain/loss. So how would u do it during retirement? % allocation supposed to increase with age, so i sell down equities etf portion to meet the allocation? Buying n sticking to allocation is quite systematic, i think the challenges come when we during exit strategy, right?

 

[donald83]

limster, i am nt sure whether valuing rship then give biz to fa/rm is a gd idea, does anyone do that? I repented 5 yrs for signing an ILP frm an ex classmate, which i eventually cancelled. So nw i trust n rely my own research, therefore seeking neutral views.

I guess i created a thread for another war-ground, but i value constructive debates.

The 3 plan i quoted (tm wealth, aviva myweatlh, pruwealth) are savings product i thought to be compared against retirement plan like aviva myretirement, axa retire happy etc. annuities. I am nt retiring, but isnt starting early something that is adviced by fa?

Many suggests a35 too - abt 2% yield excluding capital gain/loss. So how would u do it during retirement? % allocation supposed to increase with age, so i sell down equities etf portion to meet the allocation? Buying n sticking to allocation is quite systematic, i think the challenges come when we during exit strategy, right?

2% yield on a35 is too low i feel. Perhaps switch to REITs?

 

[limster]

Many suggests a35 too - abt 2% yield excluding capital gain/loss. So how would u do it during retirement? % allocation supposed to increase with age, so i sell down equities etf portion to meet the allocation? Buying n sticking to allocation is quite systematic, i think the challenges come when we during exit strategy, right?

I actually don't agree with lifecycle investing, so you have to ask those who subscribe to it.

I frankly don't intend to sell/rebalance much except maybe to convert any individual shares I have to dividend paying ETFs. When I retire, I expect that dividends > expenses and home loan already paid up. There is no need to draw down anything.

For those at the start of their investing journey, you won't know whether you will be successful in investing because you have no track record. So good to have other insurance in case you turn out to be a lousy or unlucky investor.

If you already have a track record and you are not a gambler than maybe no need for such insurance.

Myself, thanks to the last GFC and with help from the recent downturn (another chance to buy when STI below 3,000), I feel that I am on track to my retirement target. So my WL policy has done its job in providing me insuance until I can confim that my investments are doing ok and I could surrender and realise the 3% CAGR if I wanted to.

 

[wts2013]

Erm cool down guys...

There are pro and cons for both policy.

Why no one mention the age when you buy?? Over here ( this forum) the age should be >25 and most are investing therefore will view WL as "not worth" as compare to Term. The money 'save' can have better return.

If a person maybe < 20 buy WL pay for 10 years. By the age of 55, compound interest should break even the premium paid or slightly more.( need to work out the figures)

Let's keep a positive discussion

Why this one not deleted?

Your comment "WL is not worth as compare to Term": People who buy whole life are into a win win business deal! WL is another potential source of retirement funds, can be viewed as part of retirement planning.

Your comment "If a person maybe < 20 buy WL pay for 10 years. By the age of 55, compound interest should break even the premium paid or slightly more.( need to work out the figures)" This is a fundamentally incorrect statement/view about WL! U can buy WL anytime but better to buy early in age cos premium will be lower resulting in higher surrender value upon maturity or surrender of policy. What we have breakeven in 7 years, we dun pay just for 10 years, by age 55 your surrender value would have more than doubled what u paid in premiums, works out to 4-5% compounded interest! Provided u buy the right policy