Young man need advice

[unhinged_loon]

I have no idea man hahahaha!

I've been thinking about that for the past few days though.

Er, the coverage is a 10 year term, so until 2026. ~34.

premium is 31.29 monthly. No money to pay a lump sum for a year even though i know it helps to save quite a bit.

The point of buying insurance is to hedge against risks. For term insurance, it is to hedge against risks of you kneeling over for your dependents. If your dependents are your parents, and given your age, they are unlikely to be kneeling over in 10 years (unless your parents are in their 80s). If so why 10 years?

The tenure of your term should be dictated by the time period during which you need to protect your dependents from the event of your unexpected demise.



Why can't you save up money to pay your premiums in a lump sum to save on costs?


BTW, you have an emergency fund? I don't mean a few dollars stashed away in a drawer.


Seriously, you need to be more active in cost cutting, given your current salary and general cash flow.

 

[BBCWatcher]

The point of buying insurance is to hedge against risks. For term insurance, it is to hedge against risks of you kneeling over for your dependents. If your dependents are your parents, and given your age, they are unlikely to be kneeling over in 10 years (unless your parents are in their 80s). If so why 10 years?

The tenure of your term should be dictated by the time period during which you need to protect your dependents from the event of your unexpected demise.

There's one more element, though. The tenure should be the time you need to protect your dependents when your bequest is insufficient to satisfy that need. It's quite possible a 10 year term is enough, or even more than enough, to build up wealth sufficient to take care of surviving dependent parents, i.e. to be in a position to self-insure at the end of the term. Also bear in mind that surviving parents would need progressively less financial support as they age, as they get closer to the ends of their lives.

In short, I can perfectly understand how a 10 year term life insurance policy might be the smart play in these circumstances (dependent parents but no other dependents, young adult starting a career and accumulating wealth).

In the event 10 years isn't enough, no problem, it's possible to buy more term life insurance just before the expiration of this 10 year term.

Again, please remember, life insurance has only one purpose: to support the lifestyles of dependent survivors. If your growing wealth and their decreasing needs converge, then you don't need life insurance. Life insurance is to close that gap when it exists. But if/when there is no gap, then you don't need it.

 

[Bigoya]

There's one more element, though. The tenure should be the time you need to protect your dependents when your bequest is insufficient to satisfy that need. It's quite possible a 10 year term is enough, or even more than enough, to build up wealth sufficient to take care of surviving dependent parents, i.e. to be in a position to self-insure at the end of the term. Also bear in mind that surviving parents would need progressively less financial support as they age, as they get closer to the ends of their lives.

In short, I can perfectly understand how a 10 year term life insurance policy might be the smart play in these circumstances (dependent parents but no other dependents, young adult starting a career and accumulating wealth).

In the event 10 years isn't enough, no problem, it's possible to buy more term life insurance just before the expiration of this 10 year term.

Again, please remember, life insurance has only one purpose: to support the lifestyles of dependent survivors. If your growing wealth and their decreasing needs converge, then you don't need life insurance. Life insurance is to close that gap when it exists. But if/when there is no gap, then you don't need it.

Life insurance is not just about your dependants if u loose your life.
What about your own life if you lost your health?

Can TS self-insure in 10years given his current financial habits if he suffers TPD or CI at age of 40? Not sure about TS, but not many can.

 

[superEDED]

The point of buying insurance is to hedge against risks. For term insurance, it is to hedge against risks of you kneeling over for your dependents. If your dependents are your parents, and given your age, they are unlikely to be kneeling over in 10 years (unless your parents are in their 80s). If so why 10 years?
The tenure of your term should be dictated by the time period during which you need to protect your dependents from the event of your unexpected demise.
Why can't you save up money to pay your premiums in a lump sum to save on costs?
BTW, you have an emergency fund? I don't mean a few dollars stashed away in a drawer.
Seriously, you need to be more active in cost cutting, given your current salary and general cash flow.

DAFUG BRO!????? YOU BOUGHT A 10 YR TERM????
-_-"
U srsly tio conned big time.

There's one more element, though. The tenure should be the time you need to protect your dependents when your bequest is insufficient to satisfy that need. It's quite possible a 10 year term is enough, or even more than enough, to build up wealth sufficient to take care of surviving dependent parents, i.e. to be in a position to self-insure at the end of the term. Also bear in mind that surviving parents would need progressively less financial support as they age, as they get closer to the ends of their lives.
In short, I can perfectly understand how a 10 year term life insurance policy might be the smart play in these circumstances (dependent parents but no other dependents, young adult starting a career and accumulating wealth).
In the event 10 years isn't enough, no problem, it's possible to buy more term life insurance just before the expiration of this 10 year term.
Again, please remember, life insurance has only one purpose: to support the lifestyles of dependent survivors. If your growing wealth and their decreasing needs converge, then you don't need life insurance. Life insurance is to close that gap when it exists. But if/when there is no gap, then you don't need it.

From what i can recall, I was not able to afford a longer protection plan because i'm currently saving for an overseas trip and was told if i wish to change this to a longer or life protection policy i can do so. The policy is valid until 2063 or something. ( Currently at work so I cannot confirm this)

I do have savings but it is for my trip. Out of my earnings, i'm actually putting aside, 800-900 each month. of which the rest are spent on the expenses including the policies. If touch wood, something happens, the money would be used for emergency use instead of going overseas.

The reason why i didn't opt for a yearly payment previous is because I wasn't getting this amount when i first signed up for the plans, (~1.2k bring home at that time) I won't have money to spend at all .

 

[akwl88]

term plan till 65 only cost 1k per yr or 83 per month for 500k worth of coverage of death and tpd, 200k coverage for ci

you pay lower if u wish for the amt of coverage to be lower

term insurance is the best insurance for protection - low costs and high coverage

 

[havetheveryfun]

term plan till 65 only cost 1k per yr or 83 per month for 500k worth of coverage of death and tpd, 200k coverage for ci

you pay lower if u wish for the amt of coverage to be lower

term insurance is the best insurance for protection - low costs and high coverage

But how come I ask agents or go the diy website they don have so cheap one

 

[BBCWatcher]

Life insurance is not just about your dependants if u loose your life. What about your own life if you lost your health?

That's not life insurance. That's disability income insurance or something else of lower quality.

Life insurance companies are endlessly "creative" in their policy designs, marketing, and sales. They'll often try to bundle other forms of insurance (and "insurance") with life insurance.

Can TS self-insure in 10years given his current financial habits if he suffers TPD or CI at age of 40? Not sure about TS, but not many can.

That's an interesting question, but life insurance doesn't help address those risks. Disability income insurance would.

 

[akwl88]

But how come I ask agents or go the diy website they don have so cheap one

Cheap things how to earn comms?

Lol

Diy shld have

Or compare first

 

[intime]

From what i can recall, I was not able to afford a longer protection plan because i'm currently saving for an overseas trip and was told if i wish to change this to a longer or life protection policy i can do so. The policy is valid until 2063 or something. ( Currently at work so I cannot confirm this)

I do have savings but it is for my trip. Out of my earnings, i'm actually putting aside, 800-900 each month. of which the rest are spent on the expenses including the policies. If touch wood, something happens, the money would be used for emergency use instead of going overseas.

The reason why i didn't opt for a yearly payment previous is because I wasn't getting this amount when i first signed up for the plans, (~1.2k bring home at that time) I won't have money to spend at all .

I feel that you can think about the following options,
For term life insurance,
Direct Purchase Insurance (DPI) - no need to meet any agent, no commission.
Companies offering DPI is listed in the website here,
http://www.moneysense.gov.sg/Unders...Life-Insurance/Direct-Purchase-Insurance.aspx
Can buy directly online at the insurance company's website.
Maximum sum assured can only go up to $400,000.
Can add a critical illness (CI) rider to the DPI policy.
You can search and compare for an affordable DPI term life here, http://www.comparefirst.sg

For investment,
Regular shares savings (RSS) plan.
Banks offering RSS is listed in the website here,
http://sgx.com/wps/wcm/connect/sgx_en/home/newsletter/RSS
Cost minimum $100 per month.
And you can sell those investments easily when you need the money.

You can think about whether to drop your investment linked insurance, i believe not all your money paid went into investment, some goes to agent commission and some goes into protection (which you were already protected by your term life insurance).

 

[unhinged_loon]

From what i can recall, I was not able to afford a longer protection plan because i'm currently saving for an overseas trip and was told if i wish to change this to a longer or life protection policy i can do so. The policy is valid until 2063 or something. ( Currently at work so I cannot confirm this)

I do have savings but it is for my trip. Out of my earnings, i'm actually putting aside, 800-900 each month. of which the rest are spent on the expenses including the policies. If touch wood, something happens, the money would be used for emergency use instead of going overseas.

The reason why i didn't opt for a yearly payment previous is because I wasn't getting this amount when i first signed up for the plans, (~1.2k bring home at that time) I won't have money to spend at all .

Saving for a trips is not really "savings". They are just a slightly delayed consumption.

1. Emergency funds are funds set aside only to be used in "sh!t hit the fan" scenarios, and to deal with unexpected unemployment. The typical guideline is ~6 months of expenses, though that may not be sufficient (I recommend up to 12 months, given the way the economy is developing).

Frankly, an emergency fund is the very FIRST THING TO SETUP, once you start working.

2. Retirement savings/ investments is a portfolio of cash and various investment instruments (eg. stocks, bonds, gold, etc) meant for use only when retiring or semi-retiring.

You should clearly delineate the funds for different purposes. Some people recommend different bank accounts.

 

[BBCWatcher]

....Frankly, an emergency fund is the very FIRST THING TO SETUP, once you start working....Some people recommend different bank accounts.

Singapore Savings Bonds are an excellent choice for emergency funds.

 

[windwaver]

Hi guys, just wanna get an opinion from the people here. cause I just got into a heated argument with my parents and am very lost now.

I'm currently signed up with the following policies;

monthly income 2k before cpf.

AXA inspire flexiprotector, AXA Term Protector, AXA Early stage criticare and AIA solitaire Personal Accident. Current total premium ~$200.

All of which I have been paying for 16months. After a recent meeting with my agent, I was advised to terminate the policies from AXA and put my money into AVIVA MyProtector Term Plan and AXA Pulsar, which will raise my monthly premium to around $300 but as I am not able to put in so much money every month for the AXA Pulsar, I would have lowered my current monthly premium by 50%($100+) but have no more existing investment.

My parents feel that it is a waste of my money to terminate the inspire flexiprotector as I have already put in quite a fair bit of money for a long term investment.

I have already asked my advisor to hold plans of terminating the policies I was told to terminate(Never think about the invested money part, too focused on the reduced monthly premium....) as I realise what my parents said is quite true and that after terminating the flexiprotector i got no more savings; but on the other hand i was told I cannot sign the AVIVA policy because of my monthy income.

What should I do?

Fire your agent?

I'll be very worried if any agent starts telling me to terminate and take up new plans (with a rise in premiums knowing you have a tight budget).

 

[superEDED]

Fire your agent?

I'll be very worried if any agent starts telling me to terminate and take up new plans (with a rise in premiums knowing you have a tight budget).

I was too dumb to realise that... I was tempted by the lowered premium per month but didn't think of the consequences until my parents told me...

Saving for a trips is not really "savings". They are just a slightly delayed consumption.

1. Emergency funds are funds set aside only to be used in "sh!t hit the fan" scenarios, and to deal with unexpected unemployment. The typical guideline is ~6 months of expenses, though that may not be sufficient (I recommend up to 12 months, given the way the economy is developing).

Frankly, an emergency fund is the very FIRST THING TO SETUP, once you start working.

2. Retirement savings/ investments is a portfolio of cash and various investment instruments (eg. stocks, bonds, gold, etc) meant for use only when retiring or semi-retiring.

You should clearly delineate the funds for different purposes. Some people recommend different bank accounts.

Understand bro. I really need to control my finances properly and understand what I need to save and what i need to spend... Better start late than never.

Singapore Savings Bonds are an excellent choice for emergency funds.

Thanks bro for sharing. The amount here a bit too steep for me to put in hahaha. This is at first glance. will dive deeper into this when i have the time.

 

[01asdf]

But how come I ask agents or go the diy website they don have so cheap one

Are u using comparefirst.sg? If your budget is really tight you can consider accelerated CI (which basically reduces the amount your dependants get after you die) instead of normal CI rider.

 

[BBCWatcher]

Thanks bro for sharing. The amount here a bit too steep for me to put in hahaha.

The minimum Singapore Savings Bond purchase is $500. If that threshold is too steep to start building your stash of emergency funds, then you really need to focus on building that stash.

 

[superEDED]

The minimum Singapore Savings Bond purchase is $500. If that threshold is too steep to start building your stash of emergency funds, then you really need to focus on building that stash.

yeah... hahaha. I'll start to put 2 different funds aside from now on. Else I won't have any proper savings.

 

[blurpandasg2014]

Bro, I feel you! There are agents out there who are downright unscrupulous.

Take it as a lesson learnt and its time to get thing straight.

(1) Do yourself a favour and get a Medishield Plan with Rider (Hospital Plan)

(2) Get a Term CI coverage if you are on budget (early CI can wait)

(3) Save up on your emergency Funds - at least 10k

(4) When everything is done, start on POSB invest saver

*** ps. If u wan a cheap and good accident plan, u can consider SOMPO PA STAR. Much cheaper and better than AIA Solitaire ***

 

[unhinged_loon]

Singapore Savings Bonds are an excellent choice for emergency funds.

I do not recommend putting all of the emergency funds into SSB, due to the wait of a few weeks to redeem. Half is fine, with the rest in faster to redeem accounts.

 

[BBCWatcher]

I do not recommend putting all of the emergency funds into SSB, due to the wait of a few weeks to redeem.

I do, if they are genuinely emergency funds. Credit cards (still paid in full) and your ordinary consumer bank account are part of the picture, too.