Investment linked plans vs regular savings plan?

Hi anon,

ILP stands for investment linked plan. It is a policy with an insurer which means you have to commit a pre-defined premium (although you may be allowed to take a premium holiday) over the premium term. Monies will be used to buy units in funds. If your policy has protection elements, your units will be sold off to pay for insurance charge. There may also be other fees associated with it.

RSP stands for regular savings plan and is often used to refer to setting aside a regular sum of money to invest; this can be either in Unit Trusts or Equity. You are free to stary, stop, increase, or decrease this amount any time.

Now, my view is as such; investments should be flexible and you should have the option to withdraw any time, as long as you can accept the value of your investments at the time of liquidation.

ILP: Investment-linked policy. You get an investmet component in addition to insurance policy.

RSP: Regular savings plan. Regular contribution to purchase asset/debt instruments through dollar-cost-averaging.

ILP is pretty complex with high comission fees. If you dont know how to work around it, better to just avoid. RSP is pretty standard. There's OCBC blue chip investment bank, Maybank Kim Eng, DBS digiportfolio, roboadvisors,etc. Be sure to do your own research first before investing. Also make sure you are sufficiently covered, by having at least 6 month's worth of expenditure aside,