facebookMy insurance agent keeps selling me investment plans, one of the investment plans was how I could 9x my money in 15 years, if I just put in $1k every month. Is this even a plan that is possible? - Seedly

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Anonymous

12 Dec 2021

βˆ™

Insurance

My insurance agent keeps selling me investment plans, one of the investment plans was how I could 9x my money in 15 years, if I just put in $1k every month. Is this even a plan that is possible?

Investment from Great Eastern
She also mentioned I could get 3k in passive income every month for the rest of my life after 15 years.

Discussion (29)

What are your thoughts?

Elijah Lee

Elijah Lee

Edited 22 Dec 2021

Independent Financial Advisor at Phillip Securities (Jurong East)

Hi anon,

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I'm late to your question, but please don't do that.

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We're talking about an annualized return (using DCA calculations) of OVER 23% a year for 15 years in order to 9x your capital.

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It's not going to happen. You can't sustain that kind of returns forever. I know of tech funds that return 15% annualized for the past 3-5 years thanks to the bull run in tech, but I also know that these level of returns aren't replicable in the long run. While it's good to dream big, but you have to be realistic and pragmatic as well.

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A $3K/mth passive income is possible on a $900K portfolio with a withdrawal rate of 4%, but the hard part is getting to that $900K on $1K/mth over 15 years. That's like, 18% p.a.

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I'm sorry but this just sounds like total rubbish to me. You have probably been fed a dream, and that is what it is. Stay away. I don't do 101 ILPs myself (if you have seen my other answers on ILPs, you will know my stand), and such a plan will just lock you up with harsh penalties for any early withdrawals.

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I'll just leave you with this question for some reflection

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"If you are guaranteeing your premiums of $1K/mth to GE, what do they guarantee you in return?"

I brought an investment link policy 20 years ago, big promise also, now not even break even. Agents like to sell investment link policy cos the traditional policy can only project highest 4+% return but investment policy can project 8-12% return, which may not be true.

Please report to GE. Your agent is giving the company a bad name.

9x in 15 years time πŸ€”

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it is possible. but for that to be achievable, you're looking at an annualised return of at least 28% yty for 15 years. 😎

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good luck πŸ˜‚

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