Advice on Savings Plans

With rising costs and increased learning needs, financing our children's education is no longer a simple walk in the park. Discuss with other parents about how they are managing their finances to cope with their expenses.

Advice on Savings Plans

Postby butterwaffles » Mon Aug 18, 2014 10:06 am

Dear fellow kiasu parents

I'm currently 31 and would like to have a savings plan that can give me better returns than our basic saving account. My prudential agent has recommended me the Prusave (i think). The projected amount looks good but the guranteed amount is actually lesser than the principle amount paid.

Am i asking too much or is there really no other savings plan that can at least give me a guaranteed amount that's equal to the principle amount paid? I went though the rest of the savings plans under Prudential. The guranteed is always lesser than the principle amount paid.

Would appreciate some advice on your own savings plans!

butterwaffles
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Re: Advice on Savings Plans

Postby Spurs123 » Mon Sep 08, 2014 12:16 am

hi butterwaffles,

You can take a look at prusave limited pay.

Basically you pay say 15 years premium, but can only get back the money after 20 years.

The guaranteed amount is at least equal or more than the total premium paid.

Furthermore with annual declared bonus, the final guaranteed amount will be more than the initial guaranteed amount.

I bought one in 2007 and another in 2011. To form part of the university education funds for my ds & dd respectively.

Let me know if you need more info and i will ask my prudential agent to assist you.

Spurs123
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Re: Advice on Savings Plans

Postby daddy2007 » Mon Sep 08, 2014 8:40 am

Endowment plan (aka saving plan) typically gives you about 3% annual return.

There are plans out there who can give you the guaranteed amount is at least equal or more than the total premium paid.

I have reviewed through such plan from various insurers (e.g. Prudential, AIA, NTUC, Tokio Marine Asia). There returns for AIA & Prudential are not so great, considering the past record.

In the end I bought TM Asia due to it's better return and past record (no cut of project bonus for the past 15 years)

Some insurers prefer to pay out higher annual reversionary bonus, with little terminal bonus. Others prefer to pay out lower annual reversionary bonus, with a substantial amount of terminal bonus

So you have to decide your preference.

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Re: Advice on Savings Plans

Postby tofusmelly » Tue Sep 09, 2014 4:03 pm

Prudential agents have the highest commission rates in the market.

tofusmelly
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Re: Advice on Savings Plans

Postby starlight1968sg » Tue Sep 09, 2014 4:09 pm

tofusmelly wrote:Prudential agents have the highest commission rates in the market.

Really? I thought it was A*A.

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Re: Advice on Savings Plans

Postby pirate » Tue Sep 09, 2014 5:00 pm

If you have such a long investment horizon, you should consider dollar averaging yourself into blue chip stocks or an index fund. Any savings plan with a guaranteed principal is not likely to achieve any significant return.

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Re: Advice on Savings Plans

Postby zbear » Tue Sep 09, 2014 8:18 pm

tofusmelly wrote:Prudential agents have the highest commission rates in the market.



My company's medical insurance is from Prudential n they sucks!!!!!

zbear
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Re: Advice on Savings Plans

Postby hophlng » Fri Sep 12, 2014 11:45 am

zbear wrote:
tofusmelly wrote:Prudential agents have the highest commission rates in the market.



My company's medical insurance is from Prudential n they sucks!!!!!


You mean those employee's benefit we enjoy as employed personnel from our company?

Well sometimes it is not the plan that sucks, it is the package that the company gets from the insurance company. Maybe the company is just too cheepo and get the cheapest plan? HaHa

hophlng
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Re: Advice on Savings Plans

Postby tofusmelly » Fri Sep 12, 2014 12:43 pm

yes, A*A 2nd.. so don't believe what their agents tell you about their 'best' plans for you... they have high quotas to hit too so they all very keen to close case one. Look for an agent that is not pushy. .. but there aren't many around really.. lol

[quote="starlight1968sg"][quote="tofusmelly"]Prudential agents have the highest commission rates in the market.[/quote]
Really? I thought it was A*A.[/quote]

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Re: Advice on Savings Plans

Postby butterwaffles » Fri Sep 12, 2014 3:08 pm

I went through the Prudential savings plan last week. Only from the 3rd year of the plan, then they will declare some sort of 'bonus'. So this bonus will be accumulated and after some years, the guranteed amount will be more than the principal amount.

My friend recommends i get an account with POSB and just transfer some money every month to buy the blue chips through them.

Sounds like what Pirate has mentioned...But my friend told me whatever amount i put in, is not guaranteed. No pain no gain.

I have some money coming in when my kids are 17 and 19 but this sum is projected and i'm not sure of the exact maturity amount. I have another sum coming in when i'm 52. Both are savings plans. So meanwhile, am wondering what else i can do to grow my money. Putting money into plans makes me abit nervous because it's like locking my money somewhere. Am not sure if i will need extra cash in future as my parents are not covered by insurance.

Daddy2007, what do you mean by annual reversionary bonus and terminal bonus? Now with 2 kiddos, i find myself having lesser and lesser time to read up. I meant to try and read up and see how i can open an account with POEM or something and try to do DIY investment but omg. So much information and i don't know when i can or if i will be able to digest. That's when my friend suggested i just dump some money every month via POSB and just wait.....

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