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SeedlyTV S2E07

Easy Strategies For Beginners To Save up! Live on Wednesday, 27 May 2020, 8pm

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SeedlyTV S2E07

Investments

Savings

Savings Accounts

What should I do if I have 10k that I'm willing to take a high risk with but am lazy to do much monitoring? What would you suggest?
JN
James ng
Level 4. Prodigy
Answered 2w ago
IWDA, this is a diversified ETF. Hold lots of companies from different countries and sector.
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Insurance

Investment Linked Policies (ILP)

Savings

SeedlyTV S2E07

Endowment Policies

Savings Accounts

Are investment-linked policies the same as insurance savings plans?
Investment linked policies and traditional endowment policies (insurance savings plans) are very different. ILPs are invested in Mutual Funds/Unit Trusts or ETFs chosen by the investor, advised by the financial advisor, where you take all the risk of the market and funds chosen. There are no guaranteed returns and you get the full upside or downside to your portfolio. Within the ILP universe itself there are multiple types. Those with a sum assured similar to a life policy (and further sub sets of this), and those that pay just 1% above your Net Asset Value which is pretty much no insurance and is instead a pure investment allocated product. You get access to a RSP method of investing into equity, bond, commodities, property funds. Traditional endowment plans provide you with both guaranteed and non guaranteed bonuses paid from an insurer's participating fund which your money is invested in (but some are non participating and are fully guaranteed). You transfer all the market risk to the insurer and you receive smoothened bonuses on a conservative portfolio managed by the insurer. Most endowment plans today are also capital guaranteed when held till maturity. Traditional endowment policies come in all shapes and sizes and are meant to be used for goals based or due date financial commitments, like providing for funding for tertiary education, or a mid term goal of a house down payment, or planning for a source of income for retirement, or leaving a source of wealth as a legacy to grandchildren, or income for charitable purposes. The shorter your endowment policy, the lower your returns, the longer it is (25-100 years) the higher it is. I've seen short term endowment plans giving high 1+% to low 2% p.a. And I've seen long term endowment plans give up to 4.6+% p.a. There are no best plans, just plans that fit your goals and then shopping around for similar type plans after the goals for it is chosen. Instead work with a financial advisor as there products aren't "off-the-shelf" products and have to come with financial advice. Understand how they pay, when they pay, and the costs and benefits that come with them.
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SeedlyTV S2E07

Endowment Policies

Savings

Investments

Should everyone consider endowment plans? Why?
Hi anon, An endowment plan will lock in your money for a pre-determined amount of time (unless it ia perpetual endowment, which will last as long as you live). Consider if you are ok to have the money locked away before you start. Be aware that if you suddenly need the money, you will likely lose money if you do a surrender or partial surrender of the plan. An endowment would be suitable for scenarios where you require a certain amount of money to be available without fail at a fixed point in time. That would be an endowment with a fixed maturity. Examples include Nowadays, there are also endowments that keep growing perpetually and will allow you to surrender a part or the whole value of the plan at any time in the future. That is also a possible alternative to a fixed term endowment. I would suggest that you speak to an advisor to determine if you even need an endowment in the first place. If you don't, there is no reason to lock up your money.
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Savings Accounts

OCBC Frank Account

Savings

SeedlyTV S2E07

What will happen if I have zero balance in OCBC Frank saving account? Will they still deduct or bill fall-below fees to me?
L
Lurkingham
Level 4. Prodigy
Answered on 22 May 2020
Yes they deduct a penalty fee of $2 if your account falls below $1000 after the age of 26. POSB has a lower fall below fees of $500.
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SeedlyTV S2E07

SeedlyTV S2E08

Seedly

How can I register to watch SeedlyTV?
Lim Qin Da
Lim Qin Da
Top Contributor

Top Contributor (Jul)

Level 6. Master
Updated on 08 Jun 2020
Hey Anthony! SeedlyTV will be live streamed on Youtube every Wednesday at 8pm. SeedlyTV S2E07 was live streamed on Youtube previously on 27 May 2020 at 8pm. If you wish to watch that episode or any of our past episodes, you could visit our Youtube channel for Season 1 and Season 2 of SeedlyTV. Similarly, you could also visit the topic pages for the respective episodes by searching up "SeedlyTV SE" in the search bar at the top right hand corner of the page, and you should see a topic page that looks like the one for S2E07 here! Under the "About" section, you will be able to view the episodes. For SeedlyTV S2E08, we will be live streaming it on Youtube on 10 June 2020 at 8pm. You could set a reminder through our Youtube channel or the SeedlyTV S2E08 Topic Page. If you have any questions which you would like our guests to answer live, you could ask them in the topic page by clicking on "Ask A Question" at the top too! As for our upcoming episodes, we will be uploading the new Youtube "upcoming live stream" videos, as well as their respective topic pages every week. They will be uploaded together with reminders on our Facebook (Page and Events) and Telegram Channel. You could subscribe and follow these pages to get updates! Thanks for supporting SeedlyTV and we hope to see you live every Wednesday :)
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SeedlyTV S2E07

Singlife Account

Savings

Savings Accounts

Interest Rates

Would you suggest someone who is self-employed to put their savings with Singlife Account, since they provide the interest of 2.5% p.a. for the first 10k and 1% p.a. for the next 90k?
G
Gaius
Level 3. Wonderkid
Answered on 28 May 2020
In my opinion, its a really good place to put your "emergency fund". Since most people have expenses of around 1.5-3k a month, saving 3-6 months worth of expenses for an "emergency fund" usually amounts to around 10k. The best part about Singlife imo is that there are no requirements to meet in order to get the 2.5%. Just set it up and forget it. Because of that, its definitely a good idea. However, if you're going to be spending the money, I think opting for a debit/credit card that has spending rebates and a reasonably high interest rate would probably be a better option. I personally have the Standard Chartered Jumpstart account that gives 1% cashback and 2% on the first 20k since I'm still pretty young, but you'll have to find out what works best for you. Cheers!
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SeedlyTV S2E07

OCBC Frank Account

DBS

Standard Chartered JumpStart Account

Savings

Savings Accounts

I currently have OCBC Frank, DBS eSaving, & SC Jumpstart account. Is OCBC Frank Account okay for savings?
Hi there, I think you should consolidate all your money in SCB Jumpstart account to make use of their 2% interest till end of this month which I have already done so last year! However, starting from 1 July onwards the interest will be cut into half. So please do it now! And you can also open a Singlife account which is at 2.5% interest , pretty high and solid too!
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FIRE Movement

Savings

Savings Accounts

Investments

Insurance

SeedlyTV S2E07

Endowment Policies

Is there any risk free investment that gives higher returns than endowment plans?
My personal take is, in order for an instrument to give returns, it must be exposed to risks to get a yield. If there is no yield, then there is no risks. Hence, personally there is no such thing as risk-free investments. There is a variant of endowment plans called Traded Endowment Plans (TEPs), which are endowment plans which were pre-owned, bought-over and then re-sold by brokers, for shorter term to maturity and projected higher returns as compared to newly incepted ones. TEPs are also low-risk instrument and not risk-free. Disclaimer: I co-founded a business trading insurance policies.
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SeedlyTV S2E07

Endowment Policies

Insurance

Savings

I have a 20 year endowment that my parents bought for me since I was young. Should I continue on holding to it if I want to invest instead?
Hi anon, If your parents bought it for you when you were young, there's proabably not that many years of payment left. I'm guessing maybe 5 more years at most to pay. Then you can just let it roll and not bother about it, till it matures. It will act like a fixed income portion of your portfolio. Please don't surrender the policy unless you have no other option. The compounding effects are tremendous, and you should get a pretty decent payout when it matures. You can check your policy value by logging in to the insurer's portal (might be under your parent's name however, you have to check). Older policies from the early 2000s have pretty decent rates.
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SeedlyTV S2E07

Savings

Savings Accounts

Are there any downsides of having a savings plan? If yes, what are they and what are some considerations I need to take note of before having one?
Hi anon, A savings plan sacrifices liquidity for guarantees. You have to make a commitment to paying the premiums over a number of years, and thus it has to be a comfortable amount within your budget. In exchange, if you hold to maturity, you get a guaranteed maturity value, plus potential upside from non guaranteed returns. Naturally, due to the profile of the investment allocation, it won't be the same level of returns as a pure equity portfolio, but this is also not an apple to apple comparison either. Savings plans can be a decent vehicle if you have a time bound commitment whereby funds must absolutely be ready without any risk. The easiest example is education. If your child was going graduate from university this year with a loan due, would you have a $50K maturity proceed payout to you, or be forced to liquidate your stock portfolio that's down 30% from what you expected? No strategy/asset class is perfect. Know the product and you will know if it fits your needs, even if you only need it years later.
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