Should i surrender / sell my endowment plan?

Hi anon,

If this is your final year of premium payment, then this endowment plan has no cash flow impact on you after this year, assuming you have no issue to pay the fifth and final premium. I'd suggest that you pay the premium payment and treat the endowment as a long term stable store of value.

Different asset classes have different purposes. While you can say that you will get potentially higher returns from ETF/robo/crypto, there is no guarantee on your returns and thus everyone needs to ensure that they remain diversified, and have some assets that are not correlated to market as well (e.g CPF/endowment).

Ultimately, if you have no need for the money at this point, treat it as a stable store of value. But if your situation is different, please consult an advisor.

I totally understand ur situation. As mentioned by many, since u have already invested, just take it as the last line in life if something bad happens to you before u turning 55 and u need the cash urgently. By then, your surrender value total outlay should be at least the premium you had paid for. If you take out now, you may face an issue of finding the right investment vehicle to double ur invested capital.

If you want to take the hit, so assuming $17k a year, surrender at around 53%, means you can only take back about $36k.

If the returns for this savings plan is at 3% at the maturity (e.g 20 years), the total returns would be around $145k.

To achieve the same $145k, if your robo investments etc is earning at an average of 7%, it would take around 15 years for you to achieve $146k with a lump sum of $53k (surrender value of $36k + $17k premium for the last payment) = $53k compound at 7% for the next 15 years.

So to make sure that you can get better returns or for this whole thing to make sense, you would have to ensure that your investments can earn more than 7% over the next 15 years.

Anyway this is assumptions based on the savings plan giving 3% returns at the end of 20 years.
But hope it helps you to see this better.

Since it’s going to be your final year, I think you should not sell, it’s not worth it to surrender at 53% ><