I am in my 30s and I just started investing in investment-linked insurance policy. I am starting to look into stocks / robo-advisors. Any advice for me where else to begin?

I got an investment-linked insurance policy last year @ 10k per year for 10 years.

From reading some posts in this seedly community it seems like it is better to start investing on my own with a dollar cost average sum of money every month.

Is there any advice that you guys can share with me on how I should get started? I can do a decent 1-3k worth of investment per month

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Elijah Lee

22 Aug 2020

Senior Financial Services Manager at Phillip Securities (Jurong East)

Hi Xian Lee,

It sounds like you have a 101 ILP. Such policies have a high welcome bonus but come with various terms and conditions, such as lock ins, various layer of fees, and early encashment penalties. You might want to look at the policy in detail to understand it further. Personally, if I were to invest, I would want the ability to do it on my own terms, ensuring that I do not have any restrictions whatsoever.

If you are having a $1K to $3K budget a month, then you may consider splitting up your budget into perhaps 3 segments, 1/3 each, for starters. Later on you can adjust your allocation as you see fit into order to suit your preferences.

One portion can be used to DCA, for example, Unit Trusts or Robo

One portion can be used to put into stocks, however, you can just put this money into your stock account first while waiting for buying opportunity

One portion can be put into a safe asset class to hedge your risk, for example a retirement income plan.

The goal is to build for yourself a multi asset income portfolio with income coming from different sources so that you can get multiple streams of income in your retirement. Personally I feel that income is key to retirement. Having assets does not mean you can meet your expenses unless that asset puts money in your pocket.

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Duane Cheng

18 Aug 2020

Financial Consultant at Prudential Assurance Company Singapore

Hi Xian Lee,

For starters, if you are paying yearly for your ILP, you should convert it to monthly so that you can allow your ILP to DCA properly as well.

Depending on your acumen, and your goals, starting off with ETFs would be better for DCA. This would reduce the hassle for yourself, in terms of selecting companies to invest in.

You can also opt for portioning your monthly investments between local blue chips for long term stability, and for foreign based equities for growth, provided you have some investment knowledge. Starting to create a defensive portfolio, would also insulate your portfolio against negative portfolio movements as well.

Hope i was able to shed some insight!

*This does not constitute as investment advice. Please do your own due diligence before making any investment decisions.

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